Multibillion-dollar deals expected as Saudi Arabia investment forum looks east

Participants watch a movie highlighting the Red Sea project at last year’s Future Investment Initiatives conference in Riyadh. (AFP)
Updated 25 October 2018
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Multibillion-dollar deals expected as Saudi Arabia investment forum looks east

  • The Future Investment Initiative is tipped to see big investment partnerships from Russia and China
  • The FII is a key event in showcasing Saudi Arabia’s investment opportunities and economy, and linking foreign and local businessmen

RIYADH: A major investment show in Saudi Arabia is expected to attract thousands of delegates and see deals worth hundreds of billions of dollars — despite several largely “symbolic” last-minute cancelations by speakers.

The Future Investment Initiative, which starts on Tuesday, is tipped to see big investment partnerships from Russia and China, despite several executives, mostly Western, pulling out after the killing of Saudi journalist Jamal Khashoggi.

Many of those Western firms have however sent lower-level representatives or regional heads — with big business likely to be done, Saudi officials said.

Speakers from the Russian Direct Investment Fund, Russia-China Investment Fund and electronics giant Samsung are all billed to speak at the event. They join Saudi speakers including Energy Minister Khalid Al-Falih, Yasir Al-Rumayyan, head of the Public Investment Fund (PIF), and sports official Princess Reema bint Bandar. 

“Investing in transformation,” “technology as opportunity” and “advancing human potential” are among the FII’s themes. Held at the Ritz-Carlton hotel in Riyadh, the three-day event is billed as a “blueprint for the 22nd century.”

Ellen Wald, president of the Transversal Consulting think-tank and author of the recent book “Saudi Inc,” said many executives — notably those from Russia and further east — were still looking to do business at the event despite some having pulled out.

“I think the big pull-out of CEOs is not really reflective of the corporate interest in the Kingdom because we see them sending their next level of executives along. So to some degree it is symbolic,” she told Arab News. “In terms of attracting foreign investment, Saudi Arabia could have strategic leverage with Russia and China, and a unique opportunity to work on cutting-edge technologies.”

John Sfakianakis, director of economic research at the Gulf Research Center in Saudi Arabia, said he expected the event to be a success. 

“The FII is a key event in showcasing Saudi Arabia’s investment opportunities and economy, and linking foreign and local businessmen,” he told Arab News. 


Pacific Rim trade bloc meets in Tokyo, prepping for growth

Updated 9 min 58 sec ago
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Pacific Rim trade bloc meets in Tokyo, prepping for growth

TOKYO: Representatives from a Pacific Rim trade bloc geared up to roll out and expand the market-opening initiative as they met Saturday in Tokyo, reaffirming their commitment to open and free trade and inviting new membership.
The Pacific Rim free trade agreement, rejected by President Donald Trump after he took office in 2017, took effect at the end of last year after Australia became the sixth nation to ratify it. So far, seven of the 11 member countries have done so, and the others are expected to follow through soon.
Known as the Comprehensive and Progressive Trans-Pacific Partnership, the agreement aims to streamline trade and slash tariffs to facilitate more business among member nations with a combined population of nearly 500 million and GDP of $13.5 trillion.
The trade officials at the meeting in Japan’s capital reaffirmed the importance to promote free trade and economic integration in the Asia-Pacific region and beyond, said Japanese Economy Minister Toshimitsu Motegi, who chaired the gathering.
The 11 nations remaining after the US withdrawal amended the pact to enable it to take effect even without Washington’s participation. Vietnam, Canada, Mexico and Singapore also have ratified it. Peru, Chile, Brunei and Malaysia have not yet done so and were encouraged at the meeting to push forward the process.
“Amid growing concerns over recent trends toward protectionism, the ministers shared the view that it is of paramount importance to maintain and further strengthen the principles of an effective, open, inclusive and rules-based trading system,” Motegi said, reading from a joint statement.
In his opening statement earlier at the meeting, Japanese Prime Minister Shinzo Abe praised the 11 ministers for achieving the trade bloc at a difficult time for supporters of the free trade system amid rapid change in the increasingly globalized economy, causing concerns and frustration about the existing system and triggering trade disputes.
“We should not turn the clock backward. ... We need to squarely face any worries and anxieties and achieve fair regulation so as to further develop free trade. TPP is at the forefront of that movement,” Abe said. “The door is always open to those who share our vision, and those who accept TPP’s high standards.”
The US departure was a huge loss given the size of the American market. But others, including Taiwan, are reportedly interested in joining the trade deal, seen as a first step toward a pan-Pacific free trade zone.
Trump said he was putting “America first” in seeking bilateral deals rather than broader ones like the Trans-Pacific Partnership — the trading group’s original name. Members are still hopeful the US might eventually rejoin.
“We welcome new participation of as many countries and regions as possible, including the United States,” Motegi said.
For now, nearly two dozen stipulations sought by the US in the original deal reportedly have been shelved after Washington withdrew, watering down the plan proclaimed by the previous administration of President Barack Obama as being the “gold standard” for 21st century trade rules.
Separate efforts are underway to forge a free trade arrangement within Asia called the Regional Comprehensive Economic Partnership, which encompasses the 10 members of the Association of Southeast Asian Nations plus Japan, South Korea, Australia, New Zealand, India and China, but not the United States.