Saudi Finance Minister Mohammed Al Jadaan
Image credit: Reuters
Dubai: Saudi Arabia has appointed financial advisers for a planned green debt issue but has not yet decided on the format, Finance Minister Mohammed Al Jadaan said on Sunday.
He also told Reuters that Saudi Arabia’s economy is recovering well from the COVID-19 pandemic and that he expects the non-oil economy to grow between 4.7% and 5% this year, with an overall GDP growth of 2.8%.
The authorities have no plans at this time to adjust the value added tax, he said, after tripling it last year to 10 percent to offset the impact of the decline in oil revenues on state finances.
Speaking from Rome, where he attended a Group of 20 major economies summit, Jadaan said the kingdom, the world’s largest oil exporter, is working for a sustainable economy, income and energy sources.
“The sovereign has multiple green projects. We have a lot of solar, wind and power plants that need funding and we have several new projects in the works, ”he said.
He said Saudi Arabia had appointed financial advisers, but had not yet decided on details, such as whether the new funding would be syndicated, bond or sukuk, local or international.
“We are working on it and we will announce it very soon,” he said.
Ahead of the UN climate talks that began in Glasgow, Scotland on Sunday, Saudi Arabia said last month it planned to achieve “net zero” in greenhouse gas emissions from by 2060, which climatologists say is too slow.
“We take climate change very seriously … (but) we have to make sure that we are also realistic about the transition,” Jadaan said.
The world’s largest oil exporter has repeatedly stressed the continued importance of fossil fuels for the security of global energy supplies.
The Vision 2030 program launched by Crown Prince Mohammed bin Salman aims to gradually wean the economy off oil exports by creating new sectors and mobilizing the private sector in the Gulf State.
As part of the economic diversification efforts, the crown prince announced in March a program called Shareek in which the local private sector would invest 5,000 billion riyals ($ 1.3 trillion) by 2030.
The Minister of Finance said it is a medium to long term program, but since the beginning of the year, he has achieved a total of 470 to 500 billion riyals of investments from private companies. and listed on the stock exchange.
The sovereign wealth fund PIF, the engine of the kingdom’s economic transformation, also plans to inject some 150 billion rials into the national economy each year until 2025.
Jadaan said the PIF had “great liquidity” and that there was “no thinking at all at all for further transfers” after a $ 40 billion transfer from the central bank’s foreign exchange reserves last year to help the PIF finance investments.
