Saudi Arabia welcomed U.S. President Donald Trump with agreements for deals worth tens of billions of dollars on Saturday as he embarked on his first state visit to the kingdom, which is undertaking unprecedented economic reforms.
The Public Investment Fund, Saudi Arabia’s sovereign wealth fund, is contributing $20 billion in an infrastructure investment fund with Blackstone Group LP. The fund will eventually double in size “from other investors,” according to a statement. Saudi Aramco said it signed 16 accords with 11 companies valued at about $50 billion. One initial deal — worth $15 billion — was signed with General Electric Co. The U.S. and Saudi Defense Ministry also negotiated a package of about $110 billion, according to a White House transcript on Friday.
“I can’t imagine another business day that’s been as good for the United States or for the kingdom,” U.S. Commerce Secretary Wilbur Ross said in the Saudi capital, dismissing concern that controversy engulfing Trump’s administration at home would impact his first overseas trip as president.
Saudi Arabia, the world’s biggest oil exporter, is eager to reset relations with the new U.S. administration after feeling shunned by President Barack Obama, who crafted the 2015 nuclear deal with their Shiite rival Iran. The kingdom is also embarking on plans to diversify its economy away from oil – including the sale of a stake in Aramco — after crude prices slumped by half over the past three years.
Officials gave different figures for the value of all the deals signed. Foreign Minister Adel al-Jubeir said the agreements that were concluded valued more than $380 billion, $30 billion more than what was announced by Secretary of State Rex Tillerson in the same news conference. Earlier in the day, Saudi Cabinet Minister Mohammed Alsheikh put the total at about $300 billion.
Honeywell International Inc., Nabors Industries Ltd., Exxon Mobil Corp. and Lockheed Martin Corp. were among other U.S. firms to sign accords Saturday after American corporate titans met local business heads in Riyadh.
“Many of us sitting at the table are overseeing substantial investments in the United States,” Energy Minister Khalid Al-Falih said on a panel at the inaugural Saudi-U.S. CEO Forum that included Saudi billionaire Lubna Al-Olayan and Finance Minister Mohammed Al-Jadaan.
The kingdom’s PIF also said it contributed in SoftBank Group Corp.’s Vision Fund, in addition to contributions from Mubadala Investment Co., Apple Inc., Foxconn Technology Co., Qualcomm Inc. and Sharp Corp. SoftBank announced its first close of the fund Saturday with $93 billion of commitments. The Saudis may put as much as $45 billion into the venture, people aware of the matter said in January.
The kingdom’s new defense company Saudi Arabian Military Industries was also due to sign four “large deals” with leading global technology, military and industrial firms, Al-Falih said, without naming the companies.
Raytheon Co. will cooperate with SAMI, as the firm is known, on defense-related projects and technology development. It will establish Raytheon Arabia in Riyadh, the company said in a statement. SAMI was set up this month to help reduce reliance on foreign purchases and to diversify the economy away from oil.
Trump’s eight-day trip will also take him to Israel and Europe. Leaders and representatives from 54 Arab and Muslim countries will also be present during his two-day stay in the kingdom, a close U.S. ally.