Silk Road Fund invests in ACWA’s renewable unit 

26 February 2019 - 12:00 am UTC

China’s Silk Road Fund will team up with Saudi Arabia’s ACWA Power in renewable investments along the Belt and Road countries.

The USD 40bn fund signed an agreement with the Saudi Arabian power investor and developer in Beijing. The agreement will see the Chinese fund invest in ACWA Power Renewable Energy Holding, the renewable offshoot of ACWA Power, according to an ACWA statement Monday (25 February).

A Silk Road Fund spokesperson declined to comment on the size of the proposed investment that the Chinese company is planning to invest in the tie-up.

The pair will look into regions in the Belt and Road countries including South Africa, UAE, Jordan and Egypt. The pact follows the Beijing-based fund’s acquisition of a 24.1% stake in the USD 3.9bn concentrated solar power (CSP) project in July 2018. The ​​​​​ (700MW) project in Dubai has been co-developed by ACWA (75%) and China’s Shanghai Electric (25%).

“Our growing relationships with major Chinese entities is a reflection of the strong and friendly ties between Saudi Arabia and China,” said Mohammad Abdullah Abunayyan, chairman of ACWA Power.

ACWA Power looks forward to playing a vital role in both the trillion-dollar Belt and Road Initiative led by China, and the Vision 2030 scheme of Saudi Arabia, aimed at fundamentally transforming the world’s largest oil exporter. The plan sets a target for the kingdom to generate 9.5GW of renewable energy by 2030.

The Riyadh-based utility power giant have worked with an increasing number of Chinese investors and financial service providers over the last few years, said Paddy Padmanathan, president of ACWA Power. “[The agreements] will allow us to maintain our cost leadership reputation,” he added.

The agreement was signed during Saudi Crown Prince His Royal Highness Prince Mohammed bin Salman bin Abdulaziz Al Saud’s official visit to China. Over 35 deals worth a combined USD 28bn in value have been signed on the Saudi China Investment Cooperation Forum.

In 2016, the Silk Road Fund signed its first partnership deal with ACWA and DEWA that saw the trio develop the 2.4GW Hassyan coal-fired power plant in Dubai.

 

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