The Gulf kingdom was spreading its wealth around this week (see above), balancing $110 billion in arms purchases with a $20 billion commitment to infrastructure projects — in the US.
The Saudi’s pledge to a new infrastructure fund by private equity firm Blackstone is in line with “Vision 2030,” the country’s blueprint for moving away from oil dependence, partly in anticipation of waning global demand for fossil fuels.
Part of that plan includes a move to publicly list its state oil company, Aramco, on the New York Stock Exchange. When the IPO was announced, the company was valued at $2 trillion; now, it could be worth half that amount, at best, according to Bloomberg. In January, Saudi’s Energy, Industry and Mineral Resources Minister announced plans to invest $30 to $50 billion in renewable energy projects by 2023.
The Blackstone pledge reflects a bit on a sector that is a favorite of the current US administration. “There is broad agreement that the United States urgently needs to invest in its rapidly aging infrastructure. This will create well-paying American jobs and will lay the foundation for stronger long-term economic growth,” said Blackstone President Tony James. Last month,
Arif Naqvi of the Abraaj Group said US infrastructure was the “biggest opportunity on the planet.”