Saudi Arabia has transferred a considerable amount of $80 million to the welfare fund. The unique stake transfer is a part of a plan that will help in the Public Investment Fund. This will also help to diversify the limited oil-dependent economy of the country.
The oil giant Aramco gets vast deposits
Saudi Arabia has been looking for ways to diversify its economy. They have been dependent on oil and its transport. The transfer involved a 4% stake in a state-owned Saudi Arabian oil corporation which is also called Aramco. These funds are planning to raise the management assets by over $1 trillion by 2025. However, after the large transfer, the Government of Saudi Arabia still is the main shareholder. They have more than 94 % of the shares.
Saudi Arabia is in talks for the second round of investment. There has been confirmation that the Saudi Arabia government is planning to go for the second round of investment which will give more shares to Aramco. In 2019 the company sold the initial stakes of its 2 per cent of stock on the Riyadh bourse. The money invested was finally transferred to the sovereign wealth fund. The Saudi Arabia government is looking for more such opportunities in order to boost their economy and make it less dependent on oil exports and imports.
The coronavirus pandemic has helped Aramco
According to the Hindustan Times, Aramco’s shares saw a boost during the time of the pandemic. According to the data, the price in March 2020 was 27.8 riyals. It raised the price to 37.3 riyals. The market capitalization of more than $2 trillion was reported due to the memorable hike. With the Saudi Arabia government investing, the shares are expected to grow more. Aramco still remains the most significant oil corporation company which is currently helping Prince Mohammed in his plan to make Saudi Arabia free of oil dependency.
The wealth fund is concentrated to boost the assets under the management. It will help the country in the overall development and expansion of business.
