The head of Russia’s $10 billion investment fund has nothing but praise for Saudi Arabia, citing economic diplomacy as the catalyst for improved relations between the two countries.
“We’re at the breaking point in positive territory of this relationship … We really embarked on an amazing positive journey,” Kirill Dmitriev, the chief executive of the Russian Direct Investment Fund (RDIF), told CNBC at the Munich Security Conference on Saturday.
Dmitriev, who took up his position in 2011 to improve investment flows and foreign investor confidence in the Russian economy, pointed to the Russia-OPEC deal to cut oil production as a major benchmark in his country’s relationship with the Saudi Kingdom.
“Now we have a great, positive energy deal that stabilized oil prices, and it’s good for producers, consumers, good for our economies … We have done a number of investments together, and we are pursuing better a political relationship because of this economic diplomacy.”
Saudi’s King Salman was the first Saudi monarch to visit Russia in a historic trip last October, which saw the two countries sign major arms deals.
This week, Dmitriev signaled Russia’s keen interest in investing in Saudi Arabia’s planned initial public offering (IPO) of its state energy giant Saudi Aramco, set to be the largest in the world. He told the media on Thursday that the RDIF could set up a “significant consortium” of Russian banks and investors for the IPO, which the Saudi government believes could be valued at $2 trillion.
“All we can say is that Aramco is a great company, really managed incredibly well, very successful,” Dmitriev said. “So there is major interest from investors all over the world, including from investors in Russia and China, and we know that lots of people would like to participate, and as more information emerges on the IPO, there will be major investor interest in it.”
Asked where he thought Aramco might be listed — President Donald Trump has expressed his interest in a listing on the Nasdaq — the investment chief said that was up to Aramco, adding, “All we can say is it’s a great company.”
Dmitriev did not mention the fact that Saudi Arabia and Russia remain on opposite sides of the Syrian civil war, where the Kremlin supports Saudi’s regional arch-rival, Iran. They also provide varying levels of support for opposing sides of the conflict in Yemen. During King Salman’s October meeting in Moscow, the monarch told Russian President Vladimir Putin that Iran had to stop meddling in regional affairs.
The investment chief kept his focus, rather, on recent economic success stories between the two powers.
“Through economic diplomacy, by working on business together, we were able to reach a major breakthrough in politics, and frankly we had many disagreements with Saudi Arabia on politics before,” Dmitriev described. “But now they’re much fewer and we’re definitely in a very positive territory in the relationship.”
