When you think about the richest people in the world, people like Jeff bezos, bill gates
or warren buffet are the first to cross your mind. They are, of course, unbelievable rich
and powerful, but if you compare any of them to the crown prince of Saudi Arabia, Mohammed
Bin Salman, he will put them all to shame. This young prince controls an empire worth
over 2 trillion dollars. To comprehend his level of wealth, take a
look at this. He primarily lives in Saudi Arabia, but since he flies to France time
to time to enjoy a vacation, he purchased a mansion for 300 million dollars.
In the world of the super-wealthy, you are not respected unless you have a floating mansion,
so he got himself a 134 meters long yacht (Serena) for 500 million dollars and to impress
his rich friends, he purchased leanardo de Vinci's painting for 350 million dollars.
Even Bezos would envy him. Official the real power belongs to his father,
King Salman, who became King in 2015 when his bother passed away. The King is 84 years
old, he is sick, old and he knows that he isn't going to live long. That's why instead
of ruling the country, he is making sure that he consolidates the power in the hands of
his son, Mohammed bin Salman.
To understand how he or MBS, as he known in the west, ended up as the most powerful person
in the middle east, we have to understand how the Saudi royal family works.
Ibn Saud, was one of the prominent leaders
in the Arabian Peninsula back when it was ruled by the ottoman empire but through multiple
alliances in the area, he conquered most of the area in the region and established the
kingdom of Saudi Arabia in 1932. Over his life, he had multiple wives and its reported
that he left 45 children who became kings one by one after their father passed away.
When you have so many children, its difficult to consolidate power; that's why royals through
history always had one kid or two at best as a backup plan. So although Saudi Arabia
is a monarch, it has never been where the entire power belonged to a single person because
the royal family is so big that it has 15000 members and the power was shared among them
and the King was elected by the family. For example, King Saud bin Abdulaziz was replaced
by his younger brother Faisal when he seemed incompetent by the royal family.
However, the current King Salman is the last
son of Ibn Saud, which means the next King is going to be one of the nephews of Ibn Saud,
specifically Prince Nayef. But King Salman decided to change that and made his 32-year-old
son the crown prince and removed bin Nayef from all his positions.
That created a lot of tension in the royal family since most members disagreed that the
32-year-old is qualified enough to rule the country. If he ends up the King, he will rule
for longer than any previous king since he is just 32 years old, if he ends up living
for 80 years for example, he will rule the country for the next 50 years.
Before becoming the crown prince, he graduated from Saudi king university with a bachelor
degree in law. After graduating from college, Mohammed bin Salman spent several years in
the private sector. He worked as a consultant for different government-controlled companies
and the Saudi Cabinet. On 15th of December 2009, at the age of 24,
Mohammed bin Salman entered politics as a special advisor to his father when the latter
was the governor of Riyadh Province. At this time Mohammed bin Salman began to rise from
one position to another at an unbelievable speed, such as to secretary-general of the
Riyadh Competitive Council, then became the special advisor to the chairman of the board
for the King Abdulaziz Foundation for Research and Archives, and a member of the board of
trustees for Albir Society in the Riyadh region. When your father is the crown prince, I guess,
you don't need talent or hard work to get a raise.
The young prince first started out by cracking his main rivals and imprisoned them all in
Ritz Carlton hotel. Well, that's how a prison would look like when you are a prince. He
forced them to give up most of their wealth in return for their freedom and ended up seizing
over 100 billion dollars. That's a lot of money if you ask me.
His main source of wealth is Armaco that has
a valuation of over 2 trillion dollars. Its a multinational petroleum and natural gas
company. It is one of the largest companies in the world by revenue. Saudi Aramco has
both the world's second-largest proven crude oil reserves, at more than 270 billion barrels
and the largest daily oil production of all oil-producing companies.
In 2018, Aramco's revenue exceeded 355 billion dollars, in comparison, Apple, which is also
a 2 trillion dollar company, made only 260 billion dollars.
The company is so big that it controls the
entire market, at least it leads the market. On 4th of December 2019, Saudi Aramco went
public to raise money to reduce the government's cost of running the company. It raised $25.6
billion in its IPO, making it the world's largest IPO to date, succeeding that of the
Alibaba Group in 2014. For decades the main goal of the company was
to pay the bills of the royal family, but the young prince has taken full control of
the company, and now he is in charge of the 2 trillion dollar oil empire, and since the
company is listed on Saudi exchange, its not accountable to anyone, the prince can spend
all these hundreds of billions of dollars every year on whatever he desires.
He is known for his extravagant lifestyles, he spends hundreds of millions of dollars
on mansions, planes, helicopters, yachts.
But the prince wants to be known for something else like transforming his country from an
oil-dependent country into a technologically advanced society, that's why he launched his
vision 2030. Vision 2030 plans to reform Saudi's economy towards a more diversified and privatized
structure. It details goals and measures in various fields, from developing non-oil revenue
streams to privatization of the economy to e-government and sustainable development.
He also plans to build a brand new city called Neom. Its a $500 billion economic zone to
cover an area of 26,000 square kilometers on Saudi Arabia's Red Sea coast, extending
into Jordan and Egypt. Neom aims to attract investment in sectors including renewable
energy, biotechnology, robotics and advanced manufacturing. The city will also be governed
by a different set of laws that are more acceptable internationally, it's like an entire ly new
country. The goal is to attract tourists and investors from all over the world and open
the country. Prince Mohammed bin Salman's biggest bet was
his plan to restore the Saudi kingdom's dominance in global oil markets by driving the new competition
into bankruptcy, by keeping the oil price low enough for a long enough period (that's
what Rockefeller did). Saudi Arabia persuaded OPEC to do the same. A few small players went
bankrupt, but American frackers only shut down their less-profitable operations temporarily,
and waited for oil prices to go up again. But that plan was a disastrous, the prince
seems to have forgot that we are in the 21st century, and Rockefeller's strategies no longer
work, so the company had to acknowledge a defeat and raised prices.
The young prince also initiated a few mega
projects such as the much-awaited $6.7bn high-speed railway line connecting Mecca and Medina,
two holiest Islam cities that can transport around 60 million passengers annually.
He also took seriously Public Investment Fund of Saudi Arabia, its asset were approaching
400 billion dollars and the prince was confident that he can raise it to 600 billion dollars
by 2020, and guess what?! That never happened! Its assets are still under 400 billion dollars.
The young prince seems to be quite good at spending money and not making.
Official, he is not a billionaire, but h has
a 2 trillion dollar company completely under his control and an entire country. He is probably
the wealthiest person on the face of the earth.
And now it's your turn, will he be able to transform the country to an economic giant
or ruin the kingdom and be replaced? Do let us know int he comments below. And now its
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Thanks for watching and until next time.