Saudi Arabia expects that a stake of its state oil giant Saudi Aramco would be valued at more than $2 trillion. The officials of  the country said this while they confirmed the plan to sell on Monday.

Deputy Crown Prince Mohammed bin Salman said in a television interview with the Al Arabiya News Channel that the sale would be less than 5 percent of the company and would be via an initial public offering (IPO).

With subsidiaries of the firm also to be sold by IPO, there were plans for Aramco, or to give it its full name Arabian American Oil Company, to be transformed into a holding company with an elected board, the Crown Prince said according to Reuters.

“The 5 percent is from the parent company. The kingdom can live in 2020 without any dependence on oil … The Saudi addiction to oil has disturbed development of many sectors in past years,,” Prince Mohammed told Al Arabiya in the interview.

“We plan to set up a $2 trillion sovereign wealth fund… part of its assets will come from the sale of a small part of Aramco,” the Crown Prince added during the interview.

A long-term economic blueprint for life in a low-oil-price world was simultaneously unveiled by Saudi Arabia’s government.

The plan titled “Saudi Vision 2030,” drawn up in the hope of making the kingdom less reliant on crude,  includes regulatory, budget and policy changes that will be implemented over the next 15 years.

According to the press release, the plan aims to build a “prosperous and sustainable economic future” for the kingdom. Privatization and the creation of what it called the “largest sovereign wealth fund in the world” was also detailed in the press release unveiled by the Saudi government.

“We hope citizens will work together to achieve Saudi Vision 2030,” King Salman said in a brief statement, according to the Al Arabiya broadcaster.

The bulk of Riyadh’s state revenues come from energy exports as the world’s largest oil exporter.

The country logged a record $98 billion budget deficit for 2015, as there has been a crash in the crude prices that have been extending their declines — the per-barrel price of global benchmark Brent is down 60 percent since the rout first started in June 2014.

Before existing state coffers get depleted, officials are already taking action to diversify revenue sources. Ownership of the Aramco and some other national assets would be transferred to a public fund that invests cash from the country’s oil and gas operations into other sectors, Deputy Crown Prince Mohammed bin Salman said  this month.

The Kingdom could create as many as six million jobs by 2030 by focusing on eight non-oil sectors, including manufacturing, mining, tourism, healthcare and finance and it could double the gross domestic product growth from 3.4 percent in 2015, analysis from McKinsey said before the announcement of  the new economic plan Monday.

(Adapted from CNBC)

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