https://arab.news/4758c
RIYADH: Standard Chartered, as a global financial institution, is committed to raising more capital in Saudi Arabia, as the Kingdom is currently pursuing its economic diversification journey, said a top executive.
Speaking to Arab News on the sidelines of the Future Investment Initiative in Riyadh on Tuesday, Sunil Kaushal, CEO of Standard Chartered for the Middle East and Africa, said that events like FII are significant in attracting investments to the region.
“We have been involved in FII from day one. This has become a very significant event in the Middle East. It is very aptly termed ‘Davos in the Desert.’ And this is an opportunity for us to meet our clients, to meet the government officials not only from Saudi Arabia but from across the region and across the world,” said Kaushal.
He added: “We have been involved in all the major capital-raising exercises. Just last week, there was capital raised at the sovereign wealth fund level. There was capital raised at different project levels, and we were involved.”
According to Kaushal, Standard Chartered is also involved in raising capital for Saudi Arabia’s green hydrogen project being developed in the $500-billion giga-project NEOM.
In June, the NEOM Green Hydrogen Co. received the Kingdom’s first sustainable guarantee from the multinational bank, which agreed to extend funding support for its contractor Larsen & Toubro to build the necessary renewable energy infrastructure.
“The amounts that we raise in (Saudi Arabia) run into billions of dollars. Just last week, we were talking about over $15 billion of capital raised in the Kingdom from international markets. And that’s going to be more and more. I’m not even counting the money that comes into projects, etc. It is just the debt capital markets and sukuk markets where we raise funding,” he added.
Kaushal added that the capital requirements in Saudi Arabia are huge, as the Kingdom is steadily diversifying its economy.
He also highlighted that it is necessary to diversify the sources of capital, as stock markets are vulnerable to external factors.
“The requirement for capital is massive. We should be looking at how you diversify these sources of capital so that it becomes weatherproof because, at certain times, you’ll see that capital markets shutting down because of external factors,” said Kaushal.
According to Kaushal, sustainability is the future, and countries in the Middle East region that are rich in fossil fuels should revamp investments in the renewable energy sector to achieve their net-zero targets.
“If they (countries in the Middle East) have to meet their goals of achieving net zero by 2050 or 60, depending on which country you’re looking at, the amount of investment you have to make in transition finance and sustainable projects is even greater because you already have a big carbon footprint.”
Kaushal, during his final remarks, without mentioning the figures, said that Standard Chartered, which started its operations in Saudi Arabia in 2021, is expected to double its growth in the Kingdom in the next three years.