HRH Prince Alwaleed bin Talal Al Saud talked to Pat Lancaster about life after the Arab Spring, women in government in Saudi Arabia, his disagreement with the Forbes Listing and the truth about “that jet”.
There has been much excitement about the imminent launch of your television channel Alarab and your decision to site the headquarters of the new organisation in Bahrain. Can you explain the thinking behind that location decision and bring us up to date with how developments at Alarab are progressing?
We decided to establish the headquarters of Alarab in Bahrain after an exhaustive search that took us to more than six Arab capitals. We finally decided on Bahrain for a number of reasons: its proximity to Saudi Arabia was an important consideration and also because of the freedom of press and speech that the country enjoys. The terms that Bahrain offered us were attractive. Beyond that, I personally have a good relationship with the Bahraini government. Furthermore, we are in partnership with the media- giant Bloomberg in Bahrain – they are giving us back office support and, eventually, we will tap into their more than 100 global offices, pursuant to the agreement that we signed with them two years ago.
So you were not unduly worried about the on-going political situation there?
You know, each country in the Arab world has its own ‘political situation’ that one hopes it can manage to work out in its own way. I believe the King of Bahrain is managing the situation in his country very well and in a manner that will, hopefully, soon bring an end to the disturbances there.
The Custodian of the Two Holy Mosques King Abdullah took the bold initiative of admitting 30 new women members to Saudi Arabia’s Shura Council earlier this year. As a keen and frequently outspoken reformer and supporter of gender equality, what did you make of this initiative and what would you like to see happen next?
The edict by King Abdullah to admit 30 ladies to the Shura Council was a good and positive decision, and a very important one. However, for the decision to become truly historic, I think the Council must be endowed with authority and at some point in the future it should be elected. If this transpires, then obviously the decision will become historic. As of today it is important but it is not yet historic. I hope that will happen soon.
Last year you funded the Islamic department project at the Louvre in Paris and you are also involved in several initiatives to promote inter-faith cooperation and understanding. Do you have any other such projects in the pipeline?
As you know, we were very involved in establishing the Islamic department at the Louvre in Paris, which opened earlier this year. We were the largest individual donor to the project.
We also have six centres: four Islamic centres or Islamic/Christian centres, which are situated in Edinburgh and Cambridge in the UK and Georgetown and Harvard in the United States, as well as two other centres at the American University in Beirut and the American University in Cairo, that specialise in extending knowledge of western civilisation and political systems and styles of government in the West. At this stage we are concentrating on having those six centres focus on consolidating and synergising their efforts under the umbrella of the Alwaleed bin Talal Foundation. However, we are always looking for new opportunities and ideas to advance the discussion, debate and dialogue between East and West, Islam and Christianity and especially between the Arab World and the United States.
You have gone on record to speak with concern about the proliferation of nuclear arms programmes in the Middle East region. Now, according to statements made by Prince Turki Al Faisal, Saudi Arabia may be considering its own such programme. What are your thoughts on this issue as regards the region in general and the Kingdom in particular?
My personal stance is very similar to the official one taken by Saudi Arabia. The ideal situation, of course, would be to have an entirely nuclear free Middle East. In order to achieve that, I believe that Iran should not have nuclear weapons and neither should Israel. Our objective should be to have a completely nuclear-free zone. I do not believe Saudi Arabia has any intention to pursue a nuclear armament programme – remember the Kingdom is a signatory to the non-proliferation treaty. However, I do believe Saudi Arabia – like so many countries around the world – may be looking at nuclear energy options for purely peaceful purposes.
More than two years on we are still living with the effects of the Arab Spring. I know you felt strongly about the initial message being sent out from the people to their leaders, in terms of the need for democracy, education and employment, do you feel these aims are any closer to being realised?
Unfortunately, there are still on-going struggles in certain countries in the region. In the case of Egypt, Tunisia, Libya, Yemen and Syria, clearly before they can advance the cause of education, employment and also pursue their dreams of democracy, they must first solve the problem of their internal struggles and achieve political and economic stability.
In all three categories these five countries have actually regressed because of the internal civil strife they have suffered. Having said that, there are 22 Arab countries and the remaining 17, stretching from Morocco all the way to Saudi Arabia, will hopefully have learned the lessons of recent years and will devote greater effort toward achieving a society that enables their peoples to attain those worthy aims. All these matters are evolutionary, and with stability and security in place, revolutions and other types of civil strife are less likely to take place. I am in support of peaceful structural revolution, as a way of bringing about meaningful change. Generally speaking, people who enjoy the benefits of education, full employment and healthcare, develop an aversion to violent revolutions. They do not feel the need to rock the boat.
By your decision to disassociate Kingdom Holding from the Forbes Listing you struck a blow for the integrity of stock markets not only in Saudi Arabia but also across the Gulf region and beyond. Of course, there have been some problems in the past but – for the most part – these seem to have been efficiently ironed out. Your decision on the Forbes issue cannot have been taken lightly, can you please elucidate?
Part of my wealth is a function of Kingdom Holding’s market capitalisation. The issue of my personal wealth is secondary to the issue at hand. When a magazine like Forbes hits out at the integrity of the stock market in Saudi Arabia – a G20 member and home of the biggest stock market in the Middle East, it must be challenged. Saudi Arabia is one of the largest foreign reserves in the world amounting to over two trillion riyals, and has an annual GDP approaching $600bn. So when a publication – or any individual – makes accusations that such a market is somehow ‘rigged’, or operated merely ‘for sport,’ that party must be confronted head-on, which is exactly what is going to happen. We took this decision without any hesitation. We will not accept anyone casting even the slightest iota of doubt on the financial credibility of Saudi Arabia, the integrity of the Saudi market or, by extension, Kingdom Holding and its shareholders.
So you saw the move against Forbes as striking a blow in defence of the integrity of the Saudi stock market?
Absolutely, and we were not the only ones to reject the Forbes estimate of the worth of their own company. There is a big group in Kuwait, called the Al Kharafi Group, which, ironically enough, demanded to be withdrawn from the Forbes Listing a year before we took our decision.
For two consecutive years, 2012 and 2013, they announced their decision to say they did not want to be part of a subjective process such as the listing prepared by Forbes. So, you are seeing pockets of rejection of the Forbes system emerging in various locations. Having said that, there are other credible parallel publications that speak accurately about market capitalisation in Saudi Arabia and the Middle East but sadly Forbes is not among them.
You have a diverse investment portfolio with stakes in some of the world’s top companies such as Citigroup, Apple, Disney, News Corporation and Twitter, as well as other technology and media companies yet, at a time of global recession, rather than following the international downturn, your fortune reportedly increased by 32% last year (2012), according to Bloomberg. How was this achieved?
Kingdom Holding has very strong policies and strategies. Our investments in Saudi Arabia are
very successful. Although real estate globally might be regarded as being in a precarious state, in the Middle East, the Gulf region and more specifically in Saudi Arabia, real estate is having a golden lustre. Right now, we have real estate projects underway that cater to all classes of Saudi Arabian society, especially the upper lower and middle classes. Clearly our tactics have been vindicated; our strategies and policies have achieved positive results, as reflected in the Saudi Arabian stock market, which is completely independent and objective.
As someone who has been so consistently proven right in his decision-making, can you explain
how you decide to opt for one opportunity while rejecting another? Have there been any decisions that you wish, with the benefit of hindsight, you had not made and, if so, were any lessons learned?
Although I used to take business decisions myself when I was the owner of the company, since we went public, we have a very active investment committee. Even though I obviously have some say there, no decision is ever adopted unless the Kingdom Holding investment committee has first approved it, and this applies to investments at home and abroad. This small committee could be described as the brain behind Kingdom Holding. Each member has served on it for a minimum of, I would estimate, 10 years, some for as many as 15 or 20 years – displaying loyalty, dedication and commitment – qualities that I value very highly and consider vital. As for my own business decisions, I have not been consistently proven right. Frankly speaking, on many occasions
I was proven very much not right. But I will say that I try to learn from all the mistakes I have made and try to ensure that I do not make the same ones again.
Can you throw any light on the sale of “that jet”, the Airbus A380 you were expected to take delivery of later this year, that has been the subject of so much press speculation over recent weeks?
I am a businessman who has a theory, which, in layman’s terms, might be best summarised as “buy cheap and then hold until the value increases or a golden opportunity presents itself.” I applied the same principle to the purchase and sale of the Airbus. All the figures you might have seen are wrong and, while I am not going to go into detail about exact numbers, I can assure you that I bought the Airbus 380 for a very competitive price, three years ago. I did not take delivery of it because a buyer approached me with a very attractive offer, so I sold the plane for a substantial profit. Any other rumours and innuendos you may have heard are completely incorrect. I am speaking out about this for the first time exclusively to The Middle East magazine. I bought the Airbus for a very competitive price, and I sold it for a significant profit that I am happy with. My first comment on the matter was kept for The Middle East magazine.
Without any doubt you have been an inspiration to many people during the course of your life, for your business acumen and success, for your philanthropy, as well as for your innovative approach and visionary outlook on 21st century life and development. Of all the many powerful and influential people you have met, can you tell us who has been the greatest source of inspiration to you personally?
Although I have many good friends, who are a source of inspiration to me in one way or another, people who are involved in business, politics, charitable or philanthropic enterprises, there are not many people involved in all these matters at the same time in the way that I am.
For true inspiration, I would look to my grand- fathers Abul Aziz, the founder of modern day Saudi Arabia and also to my maternal grandfather Riad Solh, who was one of the founders of Lebanon and one of the major figures responsible for the country achieving its independence from France. Both of these men I consider to have been visionary heads of state. Both had great leadership qualities and shared other attributes in terms of being fearless fighters, great motivators and inspired nationalists willing to make sacrifices for the sake of their respective countries.
But, having said that, I also take inspiration from the theory of ‘3+3+1’.
Can you explain how this theory works?
First of all – at the macro level – you must have vision, a strategy and a plan. Meanwhile, at the micro level it is important to have initiative, ambition and the willingness to take some risks. The first three, together with the second three must be developed under the ‘1’, which is the umbrella of ethics, or these days better known as corporate governance. These are the basics of 3+3+1, and this guiding principle I would say has stood me in good stead.
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