Saudi Arabia is getting ready for the twilight of the oil age by creating the world’s largest sovereign wealth fund for the Kingdom’s most prized assets. Over a five-hour conversation, Deputy Crown Prince Mohammed bin Salman laid out his vision for the Public Investment Fund, which will eventually control more than USD2 trillion and help wean the Kingdom off oil. As part of that strategy, the prince said Saudi Arabia would sell shares in Aramco’s parent company and transform the oil giant into an industrial conglomerate. The initial public offering could happen as soon as next year, with the country currently planning to sell less than 5%. “IPOing Aramco and transferring its shares to PIF will technically make investments the source of Saudi government revenue, not oil,” the prince said in an interview at the royal compound in Riyadh that ended at 4 a.m. on Thursday. “What is left now is to diversify investments. So within 20 years, we will be an economy or state that doesn’t depend mainly on oil.” The sale of Aramco, or Saudi Arabian Oil Co., is planned for 2018 or even a year earlier, according to the prince. The fund will then play a major role in the economy, investing at home and abroad. PIF ultimately plans to increase the proportion of foreign investments to 50% of the fund by 2020 from 5% now, said Yasir Alrumayyan, secretary-general of the fund’s board. More reforms will follow those “quick fixes” as part of a “National Transformation Plan” to be announced within a month, including steps to raise non-oil revenue steadily through various measures including fees and value-added taxes. “We are working on increasing the efficiency of spending,” said Prince Mohammed, who is second-in-line to the throne. The government used to spend up to 40% more than allocated in its budget and that was whittled to 12% in 2015, he said. “So I don’t believe that we have a real problem when it comes to low oil prices.” (Bloomberg)