ALBAWABA – Financial leaders from Wall Street in Riyadh, Saudi Arabia, attending the Future Investment Initiative conference on Tuesday, warned that 2024 will be economically painful, especially with the ongoing genocide in Gaza mounting tension across the entire Middle East region.
Top bankers said they’re pessimistic about the global economic outlook in 2024 with elections in the United States (US) coming up and escalating tensions weighing on sentiment, Bloomberg reported.
Goldman Sachs' David Solomon, JPMorgan's Jamie Dimon and Citi's Jane Fraser were among the group of high-profile bankers and asset managers speaking at the conference.
At the Ritz Carlton Hotel, financial leaders from around Wall Street in Riyadh, and from around the world take this annual opportunity to build relationships with some of Saudi Arabia's biggest companies. Not to mention the country’s massive $778-billion sovereign wealth fund, according to Reuters, as Saudi Arabia embarks on an ambitious reform plan to wean its economy off oil.
However, the risk of genocide in Gaza drawing the entire region into an unfathomable global conflict, in the wake of the surprise Gaza attack 18 days ago, overshadowed the event.
Attendees from Wall Street in Riyadh arrive for the yearly Future Investment Initiative (FII) conference in the Saudi capital Riyadh on October 24, 2023. (Photo by Fayez Nureldine / AFP)
Meanwhile, global headwinds such as supply chain disruptions, the scarcity of materials and inflationary pressures can play to Saudi Arabia’s advantage, according to Saudi Investment Minister Khalid Al-Falih.
“In Saudi Arabia, I believe many of those challenges actually play to our strengths,” he said.
“The kingdom has one of the lowest costs of capital if you consider our risk premium on borrowing. The kingdom is quite competitive, our credit rating is good.”
Yet, the escalations in Palestine are prompting global business chiefs to think more about security issues, according to Citigroup’s Fraser.
“There is a new S in ESG which is security, be it food security, energy security, it could be defense, or financial security,” she said. “That’s certainly a theme for all CEOs around the world - how to build more resilient companies and countries.”
The event, dubbed unironically "Davos in the Desert", is now running in its seventh year and brings together leaders and corporate leaders from around the world. Just like the original Davos in the Swiss Alps.
