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(Bloomberg) – Saudi Arabia’s biggest listed companies, including energy giant Aramco, will cut dividends and redirect money to the local economy as the crown prince tries to put off his economic overhaul plan on rails.
Twenty-four companies such as Saudi Basic Industries Corp., Almarai Co., Saudi Telecom Co., and National Shipping Co. have agreed to join the plan, contributing 5 trillion riyals ($ 1.33 trillion) in spending. national capitals over the next 10 years, said Crown Prince Mohammed bin Salman.
The new plan comes after last year’s coronavirus pandemic and turmoil in the oil market created a double crisis for Saudi Arabia, pushing back 35-year targets to boost the non-oil economy and reduce unemployment .
Businesses will benefit from additional subsidies and the opportunity to lobby for the law to change, he said.
Minority shareholders of Aramco – the world’s largest oil company and 98% owned by the kingdom – will still receive dividends, the kingdom’s de facto leader said. Those in other companies will benefit from rising stock prices as the economy grows, he said.
“What we are trying to create is growth in Saudi Arabia: GDP growth, more jobs in Saudi Arabia, more income for the Saudi government and a better life for the Saudis,” the prince said on Tuesday. during a night briefing with journalists. in Riyadh. “It will not hurt the shareholders of these companies because instead of receiving cash dividends, you will get growth in the stock market.”