Saudi Arabia investing billions in global technology fund

October 15, 2016

Jeddah, Oct 15: Public Investment Fund (PIF) has taken another strong step in its mission to support Saudi Vision 2030 with its move to set up a strategic partnership with SoftBank Group Corp. (SBG), according to top businessmen and analysts.

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“This is a bold move by the PIF to explore global opportunities into tech ventures,” Basil Al-Ghalayini, CEO of BMG Financial Group, told Arab News.

His comments came as the PIF joined forces with Japanese telecom firm SoftBank to form a tech investment fund worth as much as $100 billion, making it one of the largest on the planet.

PIF — Saudi Arabia's sovereign wealth fund — is expected to put up as much as $45 billion of the money, with SoftBank throwing in at least $25 billion.

PIF, under the leadership of Deputy Crown Prince Mohammed bin Salman, has revised its long-term investment strategy to coincide with the country’s Vision 2030.

Saudi authorities have described SoftBank’s "strong investment performance" as a key reason for investing in the new tech fund.

Ihsan Bu-Hulaiga, head of the Joatha Consulting, told Arab News that the new fund reflects the implementation of PIF’s new strategy after restructuring and expanding its financial might from $160 billion to $2 trillion.

He said: “The engagement of PIF with SoftBank is more a meeting of mindsets than a mere financial collaboration.”

Bu-Hulaiga added: “In perspective, PIF compliments with SoftBank experience to provide benefits to highly selective global technology start-ups.”

In a statement, SBG said it will use its deep operational expertise and network of portfolio companies in order to add value to the fund’s investments.

“Making such investments is critical for developing a stake in the most rapidly developing and transformative sector of the global economy,” a Gulf analyst, who declined to be named, told Arab News.

“The key is to build linkages that maximize the broader benefits for the Saudi economy. This is a positive beginning but what matters is all that is built around it: Partnerships, alliances, knowledge transfer, research, etc,” he added.

The SBG statement said the fund will be managed in the United Kingdom by a subsidiary of SoftBank Group Corp. and will deploy capital from SBG and investment partners.

SBG expects to invest at least $25 billion over the next 5 years. SBG has concluded a non-binding memorandum of understanding on Oct. 12, with the Public Investment Fund under which the PIF will consider investing in the Fund and becoming the lead investment partner, with the potential investment size of up to $45 billion over the next five years.

In addition, a few large global investors are in active dialogue to join SBG and PIF to participate in this fund. The overall potential size of the fund can go up to $100 billion, according to the SBG statement.

“The Public Investment Fund is focused on achieving attractive long-term financial returns from its investments at home and abroad, as well as supporting the Kingdom’s Vision 2030 strategy to develop a diversified economy. We are delighted to sign this MOU with SBG given the long history, established industry relationships and strong investment performance of SBG and Masayoshi Son,” the Saudi deputy crown prince was quoted as saying in the statement.

Masayoshi Son, chairman & CEO of SoftBank Group Corp., commented: “With the establishment of the SoftBank Vision Fund, we will be able to step up investments in technology companies globally. Over the next decade, the SoftBank Vision Fund will be the biggest investor in the technology sector. We will further accelerate the Information Revolution by contributing to its development.”

Rajeev Misra, head of strategic finance, SoftBank Group, is leading the fund project for SBG.

SBG has engaged former Deutsche banker Nizar Al-Bassam and ex-Goldman partner Dalinc Ariburnu for the project. PIF also had its own team of experts engaged.

Commenting on the tech investment fund, Sami A. Al-Nwaisir, chairman of Al-Sami Holding Group, told Arab News: “The PIF’s move is consistent with Saudi Vision 2030 in order to build the largest sovereign fund and, at the same time, increase the possibility of generating more revenues to the Saudi budget.”

The general role of the PIF is to function like a tool in framing fiscal policies in order to bring stability to the economy and provide liquidity, he pointed out.

Al-Ghalayini also said that the PIF’s partnership goes in line with the government's Vision 2030 program and plans to diversify revenue away from oil.

“But with such a fund size of $100 billion, it will be worth watching where the fund plans to deploy this capital,” he said.

“Furthermore, with such a supply into the Venture Capitals’ funding channels, valuations of target companies might go up,” he added.

Economists say the PIF’s latest move strengthens Saudi Arabia’s ambitious plan to create a huge sovereign wealth fund that would be worth SR7 trillion ($1.9 trillion) by 2030, which would make it by far the biggest in the world.

PIF earlier invested $3.5 billion in US ride-hailing firm Uber.

At an annual rate of $20 billion, the new London-based fund could at current levels account for roughly a fifth of global venture capital investment, Reuters reported.

In the year to September, venture capital-backed companies globally raised $79 billion, according to data from KPMG and CB Insights, with tech start-ups attracting the lion's share of that cash.

“SoftBank Chairman Masayoshi Son is very good at looking for companies with big growth prospects, and that will create fierce competition," said Hiroyuki Kuroda, secretary general of the Venture Enterprise Center in Japan, was quoted as saying in the Reuters report.

SoftBank, a $68 billion telecommunications and tech investment behemoth, has also been stepping up investment in new areas. It agreed to buy UK chip design firm Arm Holdings in July in Japan's largest ever outbound deal.

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News Network
March 21,2024

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Israeli military siege, hunger, and diseases will soon become the main killer in Gaza, says commissioner- general of the UN Relief and Works Agency (UNRWA).

Philippe Lazzarini, who heads the UNRWA for Palestine Refugees in the Near East, took to X on Wednesday to vent his concern for the growing hunger and spread of diseases as a result of the Israeli siege on the besieged strip.

He said starvation and illness may soon be the main killer in Gaza.

"This fabricated and catastrophic level of hunger can still be reversed by flooding Gaza with food and life-saving assistance," Lazzarini said.

"More than ever humanity requires political will,” the UNRWA chief added.

In a press release on March 19, UNRWA said that “famine is imminent in the Gaza Strip, especially for isolated populations in northern Gaza deprived of humanitarian aid.”

The statement noted that the Integrated Food Security Phase Classification (IPC), in a latest food security outlook, concluded that up to 1.1 million people in Gaza are facing catastrophic levels of food insecurity.

“Nutrition screenings conducted in February by UNICEF and UNRWA show that rates of acute malnutrition among children in northern Gaza and Rafah have nearly doubled since January,” it said.

The Israeli regime has accused UNRWA staff of being involved in the October 7 attack by the Palestinian resistance movement Hamas against the occupied territories, prompting a number of its western allies to suspend funding for the UN agency.

On Wednesday, an agreement was reached by US congressional leaders and the White House on a massive funding bill will continue a ban on US funding for UNRWA until March 2025, Reuters reported.

Earlier this year the US, Canada, Australia, Britain, Germany, Italy, the Netherlands, Switzerland, Finland, Estonia, Japan, Austria and Romania  decided to cut their funding to the UNRWA, considered a lifeline for the Palestinians in Gaza.

France had also announced that it does not plan a new payment to fund UNRWA in the first quarter of 2024.

Condemning the suspension of funding, Lazzarini had said, “It would be immensely irresponsible to sanction an agency and an entire community…, especially at a time of war, displacement and political crises in the region.”

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News Network
March 25,2024

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A Palestinian woman has recounted terrifying incidents after Israeli military forces raided al-Shifa hospital in Gaza City last week, saying the occupying regime’s soldiers are raping Palestinian women before killing them.

Jamila Al-Hisi, an eyewitness who was besieged in the medical complex and managed to finally get out, said on Saturday that women have been subjected to rape, starvation, torture, and extrajudicial execution, adding that the International Committee of the Red Cross (ICRC) is doing nothing.

She went on to say that Israeli troops have “forced 65 families to leave the area around the al-Shifa Medical Complex whilst burning and killing entire families,” noting that they have burned a building where Palestinian civilians were taking shelter.

“We don’t even have water to break our fast, and we don’t know where to go,” Hisi said, stressing that the displaced people in the compound have not found food or water for six days.

She further called on the Red Cross to provide water for the children and the sick who are being forced to drink dirty water and eat rotten food.

Palestinians are being forcibly displaced by Israeli occupation forces from the area surrounding al-Shifa Hospital in northern Gaza, Hisi said, adding, “We are trapped amid continued Israeli shelling.”

The latest development comes as the Israeli military continues to carry out air strikes and artillery shelling in and around the al-Shifa Hospital for the seventh day in a row.

On Monday, heavily armed Israeli forces stormed the al-Shifa hospital using tanks and drones, claiming that the Palestinian resistance movement Hamas is using the facility to “conduct and promote terrorist activity.” Later that day, Israel said that “terrorist forces” were firing at Israeli troops.

The Ministry of Health in Gaza said at the time that about 3,000 people were inside al-Shifa seeking refuge and that those attempting to leave were being targeted by snipers and fire from helicopters.

Ever since the Israeli military raided the hospital last week, reports have suggested unspeakable atrocities being carried out against the doctors, nurses, and general staff as well as the thousands of displaced people there.

Israelis have admitted to executing 140 people inside al-Shifa, including paramedics, patients and wounded whilst the siege is still ongoing after seven days with mass arrests.

Meanwhile, a group of Palestinian activists have circulated a shocking story about the Israeli soldiers raping a pregnant woman in the al-Shifa hospital, alongside Hisi’s revelation.

Watan-Palestinian activists quoted the husband of a woman who was raped by Israeli forces as saying that “They ordered her to undress and began to beat her… She told the military she was five months pregnant, not to beat her, but they continued to beat her.”

“After hours, they took out all the women except the pregnant woman, and her children… They took her in front of her husband and children and raped her, ordering the men not to close their eyes or they would be shot.”

Israel waged the war on the Gaza Strip on October 7 after Hamas carried out the surprise Operation Al-Aqsa Storm into the occupied territories in response to the occupying regime’s intensified crimes against the Palestinian people.

Since the start of the aggression, the Tel Aviv regime has killed at least 32,226 Palestinians, most of them women and children, and injured another 74,518 individuals.

Tel Aviv has also imposed a “complete siege” on Gaza, cutting off fuel, electricity, food, and water to the more than two million Palestinians living there.

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News Network
March 25,2024

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The Israeli military has attacked desperate Palestinians lining up for humanitarian aid in Gaza City, killing at least 19 people and injuring 23 others in a new massacre against aid seekers. 

The Government Media Office in Gaza said in a statement that the carnage took place on Saturday near the al-Kuwait roundabout, southeast of Gaza City.

“The occupation army and tanks opened fire with machine guns at the hungry people who were waiting for bags of flour and aid in a remote place that did not pose a threat to the occupation,” the statement said.

Mahmud Basal, spokesman for the Civil Defense Department in Gaza, said there had been “heavy shooting at civilians” looking for food to help their families and children.

“There were very serious injuries, some of whom were injured by shrapnel. The reality is tragic, difficult, and challenging,” he added, saying the victims were taken to the nearby al-Ahli Arab hospital.

Speaking to Qatar-based Al Jazeera TV network, Alaa al-Khudary, a witness at the scene, said that Israeli forces shot at the crowd, leaving “many dead” and injuring others while they tried to get “a bite to eat” for their children.

However, the Israeli army claimed that the reports of its troops firing on a Gaza aid queue are “incorrect.”

In recent weeks, Israeli soldiers have conducted several deadly attacks on crowds of aid seekers in the besieged Gaza.

In mid-March the Israeli military opened fire on Palestinian civilians who had gathered in Gaza to obtain humanitarian aid, targeting them with gunfire from helicopters, tanks, and drones near the Kuwait roundabout on the outskirts of Gaza City, killing over 60 people and injuring 160 others.

In what is known as the “flour massacre”, the occupation forces killed 118 people and wounded 760 others as they opened fire on hundreds of Palestinians waiting for aid trucks in Gaza City’s al-Rashid Street on February 29.

Earlier this month, the Government Media Office in Gaza said that a total of 400 people have been killed in Israeli attacks on aid seekers since the beginning of Israel’s genocidal aggression against the Palestinian territory.

Israel waged its US-backed war on Gaza on October 7 after the Palestinian Hamas resistance group carried out a historic operation against the usurping entity in retaliation for the regime’s intensified atrocities against the Palestinian people.

So far, the Tel Aviv regime has killed at least 32,142 Palestinians, mostly women and children, and injured 74,412 others.

Israel is intentionally starving the people in Gaza by blocking their access to food, a war crime under the Geneva Conventions and the Rome Statute.

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