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00:00Some sovereign wealth funds say their goal is to get the highest rate of return. What is your overall goal. Principal goal we need to have higher returns. Positive economic impact being the engine of the economic growth in Saudi. Now you have said I think publicly you would like it to be the largest sovereign wealth fund in the world at some point. When do you think you'll be able to get the two trillion dollars. It's very much achievable by 2030. Early on your tenure I think was a three and a half billion dollar investment in Hoover. How does a deal like that come about. It came about from an app that I used and prove it was an amazing app. Would you fix your time please . People wouldn't recognize me if my tie was fixed but it just seemed so sweet . All right . I don't consider myself a journalist and nobody else would consider myself a journalist. I began to take on the life of being an interviewer even though I have a day job running a private equity firm . How do you define leadership . What is it that makes somebody tick . We're here today with his Excellency. Yes sir. Our roomie on who is both the chairman of Saudi Aramco and also the head of the PIF which is the Saudi Sovereign Wealth Fund . So you have both jobs. How do you allocate your time between running the sovereign wealth fund PPF and being the chair of Saudi Aramco. Doesn't that take you 80 or 100 hours a week to do PBF role is an executive role. Why would the current chorale is chairmanship . I don't have the executive chairmanship role. So Aramco I focus on four things. Basically the strategy the targets the annual targets that we have monitoring of the performance and managing the actual board while in PFI and the governor there although I'm a board member and DPA of board but my role there is totally different. It's an executive role and I'm there every day for a long number of hours looking after our investments opportunities and looking after our current portfolio companies. In August of 2015 he became the head API PR. What type what what size was PBF that in terms of the assets under management. Page 4 was totally different than what it is today. So in 2015 the board was changed became turned by the Crown Prince. Prince Hamad bin Salman and these we changed the strategy. So the assets under management then was the something like 150 billion dollars . Today it's over more than three hundred thirty three hundred twenty five billion dollars. You said that the crown prince appointed to the position . How well did you know the crown prince before he appointed you . Did he. Well no actually I didn't know him at all. I didn't . I heard of him. No I heard of him. I received a call before before I took the post though as a CEO of a Saudi forensic capital. And at one stage I turned around this company from a losing company to one of the most profitable companies in Saudi Arabia and the Middle East in investment banking. So at one stage we had like 41 percent of former investment banking activities. So I think the crown prince heard of me and I got the call. You got a call to meet with him. Yes. So what was like an interview. He just said guess what. We picked you and you have to leave your job in the cigarette. Better job. Or at least I thought it's gonna be an interview. But it was like here's what I want to do . One two three four. And this kind of things. And even when I said when he told me when can you start. I said yeah I need maybe like three months. Say no it's one month and you will do it. Then the next week I got another call saying you have to come immediately. So what did you tell your family. You've just got a new job or something like that. You see it's we're all very proud to be Saudis and to participate in the changes the positive gene changes that the country is all right. Is living and doing right now. I mean my wife and my kids my kids were younger then but they all felt maybe this is the right thing to do. Now you have said I think publicly you would like it to be the largest sovereign wealth fund in the world at some point. And you like it to get to a trillion dollars two trillion two trillion dollars. So when do you think you'll be out to get the two trillion dollars. The number looks really big because you know the largest sovereign wealth fund today is about 1 trillion . We think that it's very much achievable by 2030. And I will tell you where where the growth would be coming from. So number one is the performance and we're doing extremely good performance . Number two is the assets that we're getting from the government like different companies different would become and also a land bank for the government. Number three cash injections that we're getting from the government. And we've been getting some . And number four is the recycling of our profits. All those different things require a big staff to manage. How big is the pay off staff today. When we started it was the 40 people . Today we're more than 700 by year end . Our target is to have more than 1000 full time employees. Pay . If they will be all in Saudi Arabia the bulk of them would be in Saudi. But now we are opening up. And the financial capitals of the. So hopefully in the second half of this year we will have our first office going gonna be in New York and potentially London also will be in the second half. We were also considering some coverage in Asia. So most likely we going to have also an office either in China or Hong Kong or potentially even sink . Some sovereign wealth funds say their goal is to get the highest rate of return. Whatever they can do legally to get the highest rate of return invest in the country out of the country. Is your mission to get the highest rate of return. Or do you want to effect have certain goals like improving energy diversification in the kingdom or getting people to invest some money in the kingdom. What is your overall goal. Principal goal. Believe it or not this all the above. So we need to have higher returns of economic impact positive economic impact change in the the the diversity or improving the diversity of revenues . Also being one of the you know the engine of the economic growth in Saudi even we look into renewables and how we lower the emission and all of these things. As I understand our principle goal of the crown prince is to make the kingdom less dependent on oil. Absolutely. So right now I assume a very large part of your budget comes from oil. Yes it is. And you would like to get it down to below 50 percent or some number. Do you have currently I mean it's like 70 percent and the non oil revenue increased quite tremendously in the past three years or so. So eventually we want to be less dependent on oil. And the reason being it's the volatility and the oil prices. And the last thing you want to have a volatile economy. Right. So the more non oil revenue you have in the economy the better sustainable and less volatile economy. One of the very visible investments that you made early on your tenure I think was a three and a half billion dollar investment in Uber. Yeah. And you're on the Uber board . Yes. How did this a deal like that come about. That Uber call you up or did you say that you think it's a good opportunity. And how that how does a deal like that come about . It came about from an app that I used an Uber. It was an amazing app. And I like that the service is an amazing disruptor. They came in providing better service for the same customers for lesser prices. So it's just an amazing combination and made them famous. So there was one of the Uber executives visiting the country and he was visiting me for something else and I knew about it over. I asked him what about it. And they said yes we're considered in a capital race. And I asked the team to look into it. They loved it. Went through the whole governance structure. DAX we have and we have layers and layers of you know investment diligence and what have you . And we came to our investment committee then to the board. They all loved it and we decided to be so. Do you use Uber yourself when you're in the United States or in the kingdom. I used to use it. Yes I know. And they must know who you are when you show up . Maybe they do. Yeah I think so. Another very visible investment that you made was a very large investment I think about 45 billion dollars into the so-called first vision for . Yes. And so what brought that about. And are you happy with that investment. The alignment of the thinking that's what brought it. So I remember sitting down with the crown prince number of times trying to strategize. And what is it exactly that we would like to be invested in. Of course it's the future. So we said artificial intelligence robotics Internet of Things. So these were the main themes that we would like to be. And remember 70 percent of our population is under the age of 30. So we need to have something sustainable for them in the longer term. And when I met with my son for the first time he was talking about the this the exact same things that we were looking for. So the alignment itself the thinking is what drove us to have this mega partnership with Softbank. So today you're happy with the investment. It's it's up so far after like two and a half years. About nine and a half billion dollars. So it's. So after you made a 45 billion dollar commitment did you get a lot of people saying what you have 45 billion for him. What about 45 billion for me. Did you get a lot of those people calling you. I'm not that other people came in with a 45 billion dollar proposition. I feel we we have access to everyone. You are the chairman as we talked earlier about Saudi Aramco which is the largest publicly traded company in the world and also the largest oil company in the world. Is that right. Absolutely . It's the largest company from different tell us the market cap the profits that we are generating is second to none . Let me ask you about another job you have. You are the chairman as we talked earlier about Saudi Aramco which is the largest publicly traded company in the world and also the largest oil company in the world. Is that right. Absolutely. It's the largest company from different levels market cap. The profits that we are generating is second to none. And the IPO that we had was the largest IPO in the world. So you went public. Not too long ago the valuation of our cloud roughly one point eight trillion dollars something like that. It was the valuation was one point seven times seven. And now a think about the 2 trillion. For a couple of weeks. And now it's about one point eighty eight trillion today. So no company is as valuable as that company. Not all but it's traded on the local stock exchange. These are really RTX. Yes. Have you thought about listing it in New York or London or Tokyo or other places yet . Remember we only offered 2 percent of the company. So it's still 98 percent of the company owned by the shareholder which is the government of Saudi Arabia. So our program is to have multiple number of listings over the years. So we we're looking into it to have more offerings. And these offerings could continue to be in Saudi. And if we have any good stock exchange that we think can bring some value investors to us. We will definitely consider it now. Many organizations now saying they want to be carbon neutral by a certain period of DAX because carbon contributes to global climate. Absolutely. Yes. What is the position in CAC in Saudi Arabia. You want to be carbon neutral by a certain period time if possible. Saudi Aramco then walk in and their emission for decades now. So we have one of the largest if not not the largest production but at the same time we have as a country and as a company one of the lowest emission for a good reason. We started early on to have more efficient . We have been working and an uncle for the best 80 40 years. The concession that we have from the government today is about 60 years. And like most of the other oil and gas companies there concessions is between five to 10 years . So whenever we go to a site to our will we we want to make sure that this well is big enough to produce more. And at the same time our depletion rates of these wells is very small. So some of the ones that we had 86 years ago or 84 years ago still up to date operational. However I haven't said that oil is very much important. It's the cheapest the fossil fuel. Generally it's the cheapest energy source. Today you have over a billion people in the world don't have access to electricity. So you have to cater for those people. And that's why we think we be where we should be more efficient. But at the same time we shouldn't forget who we are what what we do. So historically Saudi Arabia was the biggest producer of oil in the world. You know I think maybe the United States might be or maybe Russia is bigger but Saudi Arabia could produce more oil. Given all the reserves you have. But I think you're quite comfortable at the level that you're producing is at around 9 or 10 million barrels a day. It's about 10 billion. It's a million barrels a day . So it's often said in the oil world that Saudi has the cheapest or lowest lifting costs which means that you can extract oil more cheaply. Anybody else because it's either right close to the surface or things related to that. Is that more or less true. It's it's less than four dollars. Three dollars while the other companies cost is between 20 to 50 dollars. So in terms of Saudi Aramco what are the biggest challenges you faced as chairman there. Was getting the IPO done I guess was the biggest. I've been a board member in Aramco for the best five years almost. Then I was part of the IPO committee and things were not going as I thought it should be going. So I had a number of discussions with the committee members and I told them we have to do it this way. And I had the same discussions with the government and the Crown grants. And after a while I was appointed as the chairman of that committee the IPO committee and it was last summer. And we say we have to get the IPO done before the end of 2019. We got it done. That was a huge challenge. Devaluation was amazing. The demand that we got was really great. Almost five times the demand. The . Sighs So that was the initial challenge. What would you like people to know about Saudi Arabia. Saudi Arabia is progressing every day and the progress that we have. We are witnessing is amazing . Welcome to Russia. Welcome to the Future Investment Initiative 2019. In recent years you've instituted a conference in Riyadh which is an annual event not unlike Davos or the Milken conference where it's a gathering of the elites of the investment world and they come at the conference that you sponsor . Why do you do that conference. You're going to continue to do that. We will definitely going to continue to to do it. In fact now the conference is transformed into an institution. So now it's the FIA. If I institution and we've done it for the third year in a row and they'll we will continue on doing it every year and it's going to be all around the conference. Now the crown prince announced a project that I assume that you're investing in which to build a new city. Yes. And is that something you're involved with as well or some of the people you've invested with are involved with. It's part of PPF portfolio companies MPI. If we have six different pools of investments one of these pools is the giga projects. And Neil is on top of these gecko projects. We have another from three mega projects to the Red Sea and Giardia and also Amanda Lang . In addition to the other pool of the real estate and infrastructure people who've never been to Saudi Arabia you would say that what they should know about Saudi Arabia that they might not know is what that it's different than they might think. The image of Saudi Arabia may be different than they think. What would you like people to know about Saudi Arabia . Saudi Arabia is progressing every day. And the progress that we have. We are witnessing is amazing. We're opening up for tourism the tourism sites and in Saudi Arabia. It's like one of the best in the world. My last vacation with the family. We were debating between skiing or doing something else and we ended up in LA during the holidays. And it was just an amazing location. Well when you're the head of your family and you want to go a certain place you say I'm the head of Saudi Aramco I'm the head APF and which is where we're gonna go. Where do the children get the vote. That doesn't work with my wife and children. Doesn't work. It doesn't. So today Saudi Arabia's a kingdom. There's a king and a crown prince and a royal family just as there are in some other countries such as Saudi Arabia governed any much differently than other countries in the Gulf or something or different than other countries the Middle East . If you look at the the Middle East and if you look at the world actually we have the same system since nineteen thirties when the new the third Saudi kingdom came into existence. The good thing about the regime that we have in Saudi it's progressing and developing over five years. And that's why we have reform to reform . The latest reforms that we have are really good. It started in the economic and social . And now it's going to the security and political reform. So it's the same it's the same system that has been there for the past 80 90 years. So today if you were looking at the future of Saudi Arabia you would like it to be much less dependent on oil in 20 or 30 years than it is today I assume. Is that right . Yes. And your other goals are to make Saudi Arabia goals as a citizen of Saudi Arabia to make it more comparable to other Western countries in terms of the business community would open an upside diversified. Paul. Absolutely. We are open up the Saudi economy and Saudi is open for business. OK . So you're the chairman of Saudi Aramco. That must take some time. Yes. And then you're the chief executive of the pipe . That takes some time but you must have a little time for one of your hobbies which is golf. Yeah. You're also the chairman of the National Golf Saudi Golf Federation not a golf generation . So are there a lot of golf courses in Saudi Arabia. Not yet . We have like four or five of them. The grass golf courses. But historically speaking Aramco had about I don't know maybe 14 to 20. Doesn't golf courses actually golf cited in the kingdom long ago in the 30s when Bronco started. And most of the you know the American engineers who came in they started playing golf. And it was just then that does it. I assume that sand traps were big. It wasn't hard to get sand out of the sand traps. Now I'm reading good them bunkers. I can't get the full . So now you are a 12 handicap golfer about this. You're gonna get the scratch or . I don't I don't think I have the time to scrap it. But you've played in major tournaments. Yeah we have tournaments. We had the second SA the international tournaments which is part of the European PGA too. Right . Last year we had four out of the top five players in the world . This year we had also a three out of the top five players in the world. Next month we're gonna have the first lady's European tour in March and in Jeddah. And it's gonna be an amazing experience . So if you're playing your head of the Saudi or chairman of Saudi Aramco you're the head of PPF when you're have a part of it's three or four feet. Do they just say they give it to you or they actually make you put it out. Not comments. Oh yeah . So by my standards you're a teenager. You're very young. So you're a lot more energy than presumably I have. But are you happy with these jobs and you're gonna keep doing them for the foreseeable future. You're not going to say I'm out of here in a year or two or five years or something. You're you love what you're doing presumably. And I'm so excited about this job . And it's it's the good thing about it. It's the impact that you create and the impact that will create. And not only in Saudi Arabia but the region and the whole world .

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The David Rubenstein Show: Yasir Al-Rumayyan

Yasir Al-Rumayyan, governor of Saudi Arabia's Public Investment Fund (PIF) and chairman of Saudi Aramco, talks about investing in Uber and Softbank's Vision Fund, growing the business and how the country is now more open for business. He appears on the latest episode of "The David Rubenstein Show: Peer-to-Peer Conversations." This interview was recorded on Feb. 27 in Berlin. (Source: Bloomberg)

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