RIYADH — Deputy Crown Prince Muhammad Bin Salman, second deputy premier and minister of defense who is also the chairman of the Council of Economic Affairs and Development, announced a sweeping reform plan on Monday that he said would transform the Kingdom into a global investment power and wean the world's top oil exporter off crude by 2020. In a wide-ranging interview with Al-Arabiya news channel after the Cabinet approved the reform program, the Deputy Crown Prince outlined a series of measures aimed at reshaping the Kingdom's economy. Among the themes discussed in the interview were plans to put oil giant Aramco's shares in an initial public offering, the Saudi public investment fund, a Green Card scheme, tourism, expats, defense etc. "We have all developed an oil addiction in Saudi Arabia and this is dangerous and has hampered development in many sectors during past years," he said. "I think by 2020, if oil stops we can survive," Prince Muhammad said. "We need it, we need it, but I think in 2020 we can live without oil." "The vision is a road map of our development and economic goals," he said. "Without a doubt Aramco is one of the main keys of this vision and the Kingdom's economic renaissance." The prince discussed plans to set up a $2 trillion sovereign wealth fund — the world's largest wealth fund — that would be managed by an outside board of directors, and not Aramco. The fund's revenues would go into developing the Kingdom's cities, he said. "We plan to sell less than five percent of Aramco. Aramco's size is very big. It is estimated at between $2 trillion and $2.5 trillion," Prince Muhammad told the channel. He said the Aramco IPO would be carried out inside Saudi Arabia, a move that will boost the size of the Saudi capital market, already the largest in the Arab world. By "selling even one percent of Aramco, it will be the largest IPO in the world," he said. Proceeds from the Aramco sale will go into creating a giant new sovereign wealth fund. "We plan to set up a $2 trillion sovereign wealth fund... part of its assets will come from the sale of a small part of Aramco," the Deputy Crown Prince added. The fund will include current Saudi fiscal assets of around $600 billion, as well as returns from the sales of Aramco shares and state-owned real estate and industrial areas estimated to be worth $1 trillion, he said. "Initial data say the fund will have control over more than 10 percent of global investment capacity." It will be "by far the largest on the planet," he said. "There will not be any investment or development in any region of the world without the Saudi sovereign wealth fund having a say." A green card system would be launched within five years to enable expatriates to live and work long-term in the country, Prince Muhammad said. He also announced plans to set up a holding company for military industries that would be fully owned by the government at first and listed later on the Saudi bourse. "We are now about to establish a holding company for the military industries 100 percent owned by the government that will be listed later in the Saudi market," Prince Muhammad said, adding, "We expect it to be launched by end of 2017 with more details." The Deputy Crown Prince said the economic goals of the reforms are intended to eliminate housing and unemployment problems and ensure that water and energy subsidies go to those most in need. Another way to drive up non-oil revenue, he said, is by investing more in mineral mining and boosting the Kingdom's own military production capacity. The prince also said the Kingdom, which annually welcomes millions of Muslim pilgrims to the holy cities of Makkah and Madinah, would become more welcoming to other types of tourists — in line with Saudi Arabia's values. The plan also includes major structural reforms, privatizations and efforts to increase government efficiency.
