Saudi Finance Minister Mohammed al-Jadaan said on Saturday the speed of the kingdom’s fiscal consolidation was generally right, but that authorities may slow it a bit in line with recommendations by the International Monetary Fund (IMF).
Jadaan was responding to a question about an IMF warning this week that rapid cuts to the government’s budget deficit could damage the economy.
On the other hand, US private equity firm Blackstone and Saudi Arabia’s main sovereign wealth fund said they planned to create a $40 billion vehicle to invest in infrastructure projects, mainly in the United States.
Blackstone and the Public Investment Fund signed a non-binding memorandum of understanding for the project, which will depend on further negotiations.
The US firm said it expected the vehicle to have $40 billion of equity commitments, with a $20 billion anchor investment from the PIF and the rest of the money obtained from other investors. Through this equity and debt financing, Blackstone expects to invest in over $100 billion of infrastructure projects, it said.
The new fund “reflects our positive views around the ambitious infrastructure initiatives being undertaken in the
United States as announced by President Trump,” the PIF’s managing director Yasir al-Rumayyan said.
Blackstone president Hamilton James said: “This will create well-paying American jobs and will lay the foundation for
stronger long-term economic growth.”