it starts here for the next cycle
Bit the real carrot is the Aramco IPO. While a Saudi Aramco IPO in New York was never a certainty, many had assumed it would take place there. However, the changes in the U.S. have further delayed Saudi decisions on how to move ahead with their plans. The offering is part of a Saudi strategy to reduce its reliance on oil and diversify its economy. The IPO is also the primary impetus behind Saudi Arabia's change of heart, where the kingdom is now pushing for higher prices and lower production, a U-turn from its November 2014 stance. After all the probability of finding $100 billion worth of investments is much higher with oil at $60 than $30.
In July, the Saudi fund said it would invest $45 billion in a fund run by Japanese internet and telecommunications giant SoftBank Group Corp. The WSJ sources say the Saudi officials decided to make the huge investment in SoftBank after the terrorism legislation, and the money that went into SoftBank could have gone directly into U.S. investments or U.S. investment firms. There were concerns about their exposure if they invested directly, one person said. Naturally, one can counter that they would have nothing to be concerned about if they are - as they claim - fully innocent of anything to do with Sept 11.
The Saudi fund was also interested in SoftBank on its own merits, said a person familiar with the matter, including the ability to put a large amount of money to work with a single investment and the likelihood that the fund would have access to deals from some of the world’s top entrepreneurs.
Of course, the investment had an ulterior motive too: to get Trump on the same page as the Kingdom. Some of the money that went to SoftBank appears likely to end up in the U.S. via SoftBank investments. SoftBank Chief Executive Masayoshi Son met with Mr. Trump at Trump Tower in New York on Dec. 6 and told reporters afterward he would invest $50 billion—some of it from the fund the Saudis backed—in the U.S. and create 50,000 new jobs.
So yes, much of the money invested in the US via SoftBank will come from Saudi Arabia, just as the Saudis want it, as from that moment on they would have leverage... just like they did over Clinton.
It remains to be seen just what Trump's policy toward Saudi Arabia will be, and if he will merely perpetuate the flawed foreign policy of his predecessor.
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