#SaudiArabia to Speed Privatizations to Ease Budget Deficit - Bloomberg

Saudi Arabia to Speed Privatizations to Ease Budget Deficit - Bloomberg

Saudi Arabia is hoping to speed up privatizations to narrow a budget deficit that ballooned last year due to the pandemic and a slump in oil revenue.

The kingdom aims to strike around 15 billion riyals ($4 billion) worth of infrastructure deals with private investors this year, the head of the National Center for Privatization, Rayyan Nagadi, said in an interview. That would be the most since the body was established to accelerate privatizations in 2017. It also aims to complete several asset sales this year, he said, declining to give a value for how much could be raised.

Progress on Saudi Arabia’s privatization plan has been much slower than anticipated when Crown Prince Mohammed Bin Salman launched his economic transformation plan in 2016 and outlined plans to sell stakes in utilities, soccer clubs, flour mills and medical facilities. Since then the government has managed to sell stakes in assets including Saudi Aramco and flour mills. It has also signed deals with private investors to build new schools, but it has fallen short of hopes of raising $200 billion in the first few years of its privatization push.

“We have high expectations for the number of public-private partnerships and divestments that we’re going to see in 2022 and 2023,” Nagadi said. “We have a clear pipeline of transactions. We just need to set the priority for them. We now have a lot more clarity than we did two or three years ago.”

Nagadi, a former HSBC Holdings Plc banker, was hired by the Finance Ministry in 2019 to set up a privatization unit before taking over NCP later that year.