Tuesday, November 5, 2019

The ARAMCO IPO Stumbles Out The Door

Finally after numerous delays, the potentially largest Initial Public Offering (IPO) of stock has finally become for fully state-owned ARAMCO in the Kingdom of Saudi Arabia (KSA).  MOst of the delays had involved an unwillingness by the Saudi royal family to publicize financial and other factual details about the company, although issuing an IPO for 5 percent of the company was a part of the Vision 2030 plan of Crown Prince Mohammed bin Salman (MbS). 

As it is, for the time being the IPO is only available to Saudi nationals through the Riyadh stock exchange.  It is unclear how long or even if it will open up to foreigners.  Reportedly the Saudis are hoping for it to value  the company at $2 trillion, which would put it well ahead of Apple and Microsoft, both of which are around $1 trillion.  But some observers think this is overly optimistic on the part of the Saudis for a variety of reasons.

Along with that, the US has this past month for the first time since 1978 recorded a trade surplus in petroleum products.  This will continue to put  downward pressure on global oil prices, and also depress the prospects for how much money this IPO will raise in the end.

Barkley Rosser 


Anonymous said...



Dani Rodrik‏ @rodrikdani

Important point here, but applies more broadly than randomized control trials. Remarkable how little today’s development economics has to say about the most impressive poverty reduction in history ever.

Project Syndicate @ProSyn

By recognizing work on randomized controlled trials in development economics, Yao Yang of Peking University believes the @NobelPrize has once again overlooked the most obvious and consequential development story of the past half-century: China


1:33 PM - 22 Oct 2019

Anonymous said...


October 22, 2019

The Open Secret of Development Economics
To many in China, this year's Nobel Memorial Prize in Economic Sciences seems to have shone a spotlight on one area of development economics at the expense of another. While randomized controlled trials might be useful for creating or improving welfare programs, they can't tell poor countries how to achieve and sustain rapid growth.

Yao Yang is a professor at the China Center for Economic Research and Dean of the National School of Development at Peking University.

Anonymous said...

How curious that China starting from being among the poorest of countries, far poorer than India in 1980, and having a population that is now 1.4 billion could have raised hundreds of millions to middle class well-being, could have raised hundreds of millions from poverty and coming ever closer to ending severe poverty in 2020, would have no economist worth a Nobel prize for work on poverty.  To me, this is a travesty of awarding the Nobel Prize for work on poverty to 3 Massachusetts economists.

Distressing that the astonishing and wonderful progress China has made against poverty should be given no attention and credit by the Nobel Prize folks or by the Western articles about the prize that I have so far read.  This tells me that the Massachusetts work on poverty and evaluation of the work is highly problematic, which I already knew from reading the work.

rosserjb@jmu.edu said...


We have been through this before. Nobels are not given out for policies. They are given out for new ideas. What is or are the nww idea(s) and who is respoibie for it or them to receive the prize?

rosserjb@jmu.edu said...

BTW, Anonymous, Taiwan in 1949 had about the same real per capit income as PRC did, but has a far higher one today than PRC, while also having a functioning democracy that does not persecute minority gropus, in contrast to the dictatoship that runs PRC and is severely prsecuting the Uighur minority. Should not somebody in Taiwan get an econ Nobel before somebody in PRC?

Anonymous said...

Thank you so much for the superb response. I always learn so much from you and am so grateful since I struggle so in learning about other peoples and what they have accomplished economically. You are a wonderful teacher.

rosserjb@jmu.edu said...


Thank yuo for your appreciative remarks.

A further matter involves income distribution. Of the the three current Chinas, two have massive income inequality, Gini coefficients over 40, and one is way below that. Taiwan is the latter. As it is, laissez faire Honk Kong has massive inequalirt, a major input to the big demos there. And, the PRC also has massive inequaliuty, in contrast with the super egalitarian Maoist past. Absurdley, the Gini coefficints of US, Russia, HK, and China are not that far apart, in the low 40s, seriously unequal. Taiwan is much lower.

Anonymous said...

Absurdly, the Gini coefficints of US, Russia, HK, and China are not that far apart, in the low 40s, seriously unequal. Taiwan is much lower.

Fascinating and important.