Funds Russia and Saudi Arabia have signed investment agreements worth $ 10 billion. The funds will be invested Middle Eastern investors Russian infrastructure, agriculture, retail and logistics. But talking about the friendship between Moscow and Riyadh is too early: the trade turnover between the countries is around $ 1 billion, and investment agreements were signed only after a personal meeting with Vladimir Putin, Prince Mohammed bin Salman.
Russian Direct Investment Fund (RFPI) and the sovereign fund Saudi Public Investment Fund (PIF) signed an agreement, under which the PIF invests in Russian projects $ 10 billion, said “Gazeta.ru” head of the Russian Fund Kirill Dmitriev. Seven projects have been pre-approved, and before the end of 2015 plans to announce RFPI 10 transactions. Projects are planned in the areas of infrastructure, agriculture, retail, production and logistics.
«PIF investment will be carried out in such a way that part of the funds will be reserved for automatic co-investment scheme projects in the Russian Direct Investment Fund, and the other part – for specific projects RFPI and its partners”, – Dmitriev said.
Investing Saudi Fund will be the largest foreign capital in Russia by the Russian Direct Investment Fund. Previous record deal was signed in 2013 with the fund Mubadala, representing the interests of the united Arab Emirates (UAE). The volume of transactions amounted to $ 7 billion, of which $ 5 billion was allocated to the Department of Finance in Abu Dhabi.
In addition to the investment agreement with the Russian fund PIF has also entered into a partnership with other sovereign funds of Saudi Arabia – Saudi Arabian General Investment Authority (SAGIA), which is engaged in foreign direct investment (FDI) in the kingdom.
The agreement is a framework, the amount of investment it is not defined. According to Dmitriev, promising sectors in the UAE for Russian companies may be the construction, oil industry and aeronautics.
For information about the new contract with the Russian Direct Investment Fund and its main provisions and confirmed the manual SAGIA.
«We have signed a framework agreement with the Russian Direct Investment Fund. He will establish channels of communication channels to establish bilateral co-operation, to arrange trade missions. It will contribute to attracting Russian investments in Saudi Arabia, “- said” Gazeta.ru “the executive director of investment fund SAGIA, Prince Saud Al-Faisal, Khalid.
The conclusion of the partnership largely contributed to visit delegations from Saudi Arabia to Russia at the St. Petersburg International Economic Forum (SPIEF) in June, as well as a personal meeting Prince Mohammed bin Salman with Vladimir Putin.
«The President has launched an” economic reset “between the two countries,” – said Dmitriev.
Agreement between the Fund has become the first major agreement between the two countries over the past few years. Relations between Moscow and Riyadh have cooled considerably after the start of the conflict in Syria.
According to the Ministry of Economic Development, the trade turnover between the two countries on the basis of the period January-April 2015 amounted to only $ 324 million. The bulk Russian share of exports (61%), Saudi Arabia accounted for the export of barley. The annual turnover of the last few years, ranging from the level of $ 1 billion.
On Over the years, the parties are negotiating on the draft agreement on encouragement and mutual protection of investments, but the last in 2012 for the fifth round of negotiations did not bring significant results. The conflict in Syria, only worsened the situation.
Due to the different approaches to “the Syrian issue” leadership of Saudi Arabia to limit participation of Russian business in conducted in the territory of the Kingdom of congress and exhibition events.
In particular, the June 12, 2012 the Russian delegation of businessmen, arrived on the territory of Saudi Arabia announced the decision of the Saudi authorities to abandon the previously agreed Russian Business Week in Dammam.
But in the past two years, relations between Riyadh and Moscow began to improve gradually. According to the Ministry of Economic Development, since January 2014 the leadership of Saudi Arabia through the Russian embassy in Riyadh through diplomatic channels sends “signals” about the desire of the Saudi authorities to re-engage with Russia. In particular, they discussed the possibilities of export of Russian goods, primarily agricultural production in Saudi Arabia, as well as the possible involvement of the Saudi side in investing in agribusiness development projects in Russia.
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