Saudi Arabia’s Finance Minister Mohammed Al-Jadaan said on Wednesday that Saudi Arabia may soon invest in Iran, its longtime regional foe, after the two countries reached a breakthrough agreement to rebuild diplomatic ties.
In Riyadh, when CNBC’s Hadley Gamble asked when the world would see the wealthy Saudi kingdom make major investments in Iran, and vice versa, Al-Jadaan replied: “I would say soon.”
“When people really stick to the principles that were agreed upon, I think that could happen very quickly. Our goal, and I think our leadership has made it very clear before, is to have a stable region that can serve its people Feed and prosper. There is no reason why this should not happen,” the minister said.
Riyadh and Tehran agreed to restore diplomatic ties and reopen embassies in each other’s country after China-led negotiations in Beijing culminated on March 10.
Iran’s top security official Ali Shamkhani (right), Chinese Foreign Minister Wang Yi (centre) and Saudi Arabia’s national security adviser Mosaed Aiban after Iran and Saudi Arabia agreed to resume bilateral diplomatic ties after days of deliberations A group photo shows senior security officials from the two countries meeting in Beijing, China, March 10, 2023.
Chinese Foreign Ministry Handout | Anadolu Agency | Getty Images
They also vowed to affirm “respect for national sovereignty and non-interference in a country’s internal affairs,” an important step After years of mutual hatred, suspicious attacks and espionage between the two countries.
It remains to be seen whether some regional analysts and Western policymakers are skeptical that these countries — Iran in particular — will follow through on their commitments. The two Middle Eastern powers remain ideologically divided, and neither suspicion of the other will disappear overnight.
However, the Saudi finance minister seemed optimistic.
“Iran is our neighbor, has been for hundreds of years, and will continue to be,” Al-Jadaan said. “So I don’t think there’s any issue that’s going to stop normalization, cross-investment, etc., as long as we abide by the agreement — you know, respect for sovereignty, non-interference in other countries’ affairs, respect for UN conventions and others. So I don’t see any, really. ,obstacle.”
The countries also agreed that previous cooperation agreements — the 2001 Security Cooperation Agreement and the 1998 General Cooperation Agreement, covering areas such as trade, economics, sports, technology, science, culture, sport and youth — would resurrection.
“The three countries have expressed their desire to do everything possible to strengthen regional and international peace and security,” the Saudi statement announcing the deal said, referring to itself, Iran and China.
Two major oil producers face very different economic realities: Saudi Arabia investing internationally and launching mega-projects worth trillions of dollars as part of the country’s Vision 2030 plan to wean itself off oil; and Iran, Its economy and currency have skyrocketed under the influence of years of Western sanctions, government corruption and economic mismanagement.
Investments from Saudi Arabia could be of great benefit to Iran’s battered economy, but it is unclear whether existing U.S. sanctions on Iran would apply to financial activity between the two countries.
“I think, without going into detail, I think we recognized … clearly that in order for you to be able to focus on your economic development and focus on serving the people of your country, you need stability, they Stability is needed,” Al-Jadan said. “And I think Iran has a lot of opportunity, and as long as the goodwill continues, we’re going to give them a lot of opportunity.”
Iran and Saudi Arabia have long accused each other of destabilizing the region and view each other as a serious security threat, often on opposing sides in regional conflicts such as Yemen, Lebanon and Syria. Both Riyadh and Washington have accused Tehran of being behind multiple attacks on Saudi ships, territory and energy infrastructure over the past few years.
Saudi Arabia severed ties with Iran in 2016 after Iranian protesters stormed the Saudi embassy in Tehran in response to Saudi authorities executing 47 dissidents, including a leading Shia cleric.