Saudi Arabia’s crown prince said Sunday that the government will finalize privatization deals worth 2 billion riyals ($533 million) before the end of this year, according to an interview with the Saudi-owned Asharq al-Awsat newspaper.
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The privatization drive is part of Vision 2030, a package of reforms led by Crown Prince Mohammad bin Salman that is intended to wean the economy off oil and create jobs for young Saudis.
The expected deals will be in sectors that include grain silos, medical and shipping services.
The government will next year offer privatization projects in the education sector with investments worth around 1 billion riyals, according to the interview.
The government’s aim to attract investment into everything from education to sports, a cornerstone of its effort to trim dependence on oil revenues, has been mired by some holdups and fallout from the murder of journalist Jamal Khashoggi in October last year.
Riyadh had previously set a goal of aiming to generate 35 billion to 40 billion riyals of non-oil state revenues from its privatization program by 2020. Some of that money would come from asset sales, while the rest would come from public-private partnerships.
But that drive has had some false starts. The most high-profile was the shelving of proposals to float shares in oil giant Aramco, the cornerstone of the reform program.
The crown prince, who is also known as MBS, said the government remained committed to selling shares in national oil conglomerate Aramco through an initial public offering but only at the right time.
“We are committed to the IPO of Saudi Aramco based on appropriate conditions and at the right time,” he told Asharq al-Awsat.
He reiterated his earlier expectations that the IPO of Saudi Aramco - expected to be the world’s largest stock sale - “will take place in [late] 2020 or the start of 2021,” almost two years later than expected.
Saudi Arabia plans to sell up to 5 percent of the world’s largest energy firm and hopes to raise up to $100 billion.
Prince Mohammad said that it was still premature to announce where the IPO would be held, adding that many requirements for the sale to go through had been successfully completed.
Riyadh has taken a number of key procedures in preparation for the IPO including issuing a law for hydrocarbons tax, appointing a new board for Aramco and allowing an independent auditing of the kingdom’s oil reserves, the crown prince said.
Aramco has also opened its accounts books for the first time to international ratings agencies, declared the size of its profits and transformed into a public shareholding company, he said.
The crown prince said the kingdom’s sovereign wealth fund was playing a major role in the economic diversification process and that its assets had doubled in two years to 1 trillion riyals.
