Saudi Arabia’s Finance Minister Mohammed Al-Jadaan said Wednesday that Saudi investments in Iran could happen “very quickly” following the announcement of the landmark deal to restore diplomatic relations between the two states.
“I think that could happen very quickly. Our goal, made very clear before by our leaders, is to have a stable region that can provide for its people and prosper. And there’s no reason why that shouldn’t happen,” Mohammed Al-Jadaan, told CNBC in Riyadh.
“There are many opportunities for Saudi investments in Iran. We see no impediments as long as the terms of any agreement are respected,” Al-Jadaan said during the Financial Sector Conference in Riyadh.
“Iran is our neighbor and has been and will continue to be for hundreds of years,” Al-Jadaan noted.
“So I don’t see any problem preventing the normalization of the relationship, cross-investments, etc., as long as we stick to the agreements, you know, respecting sovereign rights, not interfering in each other’s affairs, respecting UN conventions and so on,” he continued.
“Stability in the region is essential for the world and the countries in the region, and we have always said that Iran is our neighbor and we have no interest in having a conflict with our neighbors if they are willing to cooperate,” Al-Jadaan later told Reuters in an interview.
“We have no reason not to invest in Iran, and we have no reason not to allow them to invest in Saudi Arabia. It is in our interest to ensure that both nations benefit from each other’s resources and competitive advantage,” he continued during his interview with Reuters.
“If they (Iran) are willing to go through this process, then we are more than willing to go through this process and show them that they are welcome, and we would be more than happy to participate in their development,” he added.
The two major oil producers face very different economic realities.
Saudi Arabia is investing internationally and launching mega-projects worth billions of dollars as part of the kingdom’s Saudi Vision 2030 plan to move away from oil.
Iran’s economy has progressively slumped, and its currency has lost enormous value after years of Western sanctions, government corruption, and economic mismanagement.
Saudi Arabia’s investment would likely be a huge boon to Iran’s ailing economy. However, it is unclear whether existing US sanctions against the Islamic republic would apply to financial activity between the neighboring countries.
“Clearly that for you to concentrate on your economic development and focus on providing for the people of your country, you need stability; they need stability,” Al-Jadaan said.
“We will provide them with many opportunities as long as the goodwill continues,” he remarked.
Hostility between the two Middle Eastern powers has endangered the stability and security of the Middle East for decades, fueling regional conflicts in Yemen, Syria, and Lebanon.
Overcoming these differences, Riyadh and Tehran agreed to resume diplomatic relations and reopen their embassies and consulates following Chinese-led negotiations in Beijing that culminated on March 10.
In addition, the countries have agreed that previously signed cooperation agreements will be revived.
Namely a 2001 “Security Cooperation Agreement” and a 1998 “General Cooperation Agreement” covering the fields of trade, economy, sports, technology, science, culture, sports, and youth.
“The three countries expressed their enthusiasm to exert all efforts to enhance regional and international peace and security,” said the Saudi statement announcing the agreement, referring to itself, Iran, and China.
The deal, brokered by China, was announced after four days of previously undisclosed talks in Beijing between senior Saudi and Iranian security officials in which the English language was not used at any point.
“China is the first trading partner of both countries, so leverage is significant. And since we are building trust, that engagement should be done with the presence of Chinese officials,” said a senior Saudi official on condition of anonymity.
The “cold” war between the two countries has been ongoing for decades. Still, Saudi Arabia severed ties with Tehran for good in 2016 after a group of Iranian protesters invaded and attacked the Saudi embassy in Tehran and the Saudi consulate in Mashhad.
This followed Saudi Arabia’s execution of cleric Nimr al-Nimr, a prominent Shiite Muslim scholar, for “civil disobedience” after he proposed sedition and rebellion against the Riyadh government.
With information from Derecha Diario