As US President Donald Trump began his first official trip abroad in Saudi Arabia, an investment company run by one of his top supporters, billionaire Stephen Schwarzman, secured an enormous investment from the Middle Eastern kingdom.
The company, which Schwarzman helped found, Blackstone, said on Saturday that Saudi Arabia’s sovereign wealth fund had committed US$20 billion to a new investment fund for infrastructure projects primarily in the US.
The commitment is about half of the capital Blackstone plans to raise for the fund. All told, including potential borrowed money, the new fund could invest more than US$100 billion in infrastructure projects, the company said in a statement.
The fund was one of several business deals between US companies and Saudi Arabia announced after Trump’s arrival.
At a ceremony on Saturday in Riyadh, Saudi Arabia, General Electric Co said it had agreements for US$15 billion worth of projects.
The Trump administration also helped line up US$110 billion worth of arms deals, negotiations in which the president’s senior officials played prominent roles.
For instance, Trump’s son-in-law Jared Kushner personally called the chief executive of Lockheed Martin Corp to help reduce the price of a radar system.
Lockheed Martin has since announced, among other deals, a US$6 billion commitment to building 150 Black Hawk helicopters in the kingdom.
In its statement, Blackstone said it had begun discussions with Saudi Arabia about a year ago. The investment company said it had already invested in more than US$40 billion-worth of projects tied to infrastructure over the past 15 years.
Investing in US infrastructure has been advocated by lawmakers and business leaders for some time, with Trump and former US secretary of state Hillary Rodham Clinton endorsing modernizing aging airports, bridges and energy systems through public-private partnerships.
“This potential investment reflects our positive views around the ambitious infrastructure initiatives being undertaken in the United States as announced by President Trump, and the strategic opportunity for the Public Investment Fund to achieve long-term returns given historical investment shortfalls,” Yasir Al Rumayyan, the managing director of Saudi Arabia’s Public Investment Fund, said.
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