Saudi Arabia to Invest in Israeli Startups Through American Fund

Rabat – Saudi Arabia’s Crown Prince Mohammed Ben Salmane is set to invest tens of millions of dollars into two Israeli startups through Affinity Partners, an American private equity fund.

The fund is held by Jared Kushner, the son-in-law and former senior adviser of ex-American President Donald Trump.

As a key figure in the Trump administration, Jared Kushner helped broker the Abraham Accords or normalization agreements between some Arab countries and Israel, leading to the restoration of diplomatic relations between Israel and the UAE among others.

While Saudi Arabia is yet to officially “normalize” relations with Israel, there have been reports that the Saudi Crown Prince is favorable to a Saudi-Israeli rapprochement. At the same time, recent developments also point to considerable signs of de facto normalization of relations between the two countries.

Kushner’s private-equity fund holds more than $2 billion belonging to the Saudi Arabian government, the Wall Street Journal (WSJ) reported today, adding that the Saudi Crown Prince has approved investments in Israeli ventures.

The unprecedented event marks the first time Saudi Funds are diverted to Israel.

Business for peace

“If we can get Israelis and Muslims in the region to do business together it will focus people on shared interests and shared values,” Kushner told the WSJ. “We kicked off historic regional change which needs to be reinforced and nurtured to achieve its potential.”

Saudi Arabia holds $2 billion out of the fund’s $3 billion capital, according to WSJ reports.

While trying to talk the Saudi government into approving the investment, Kushner underscored the significant growth prospect linked to “the Silicon Valley of the Middle East.”

According to sources who spoke to WSJ, Saudi Arabia’s Public Investment Fund (PIF) does not exclude Israeli firms from the list of prospective markets.

Chaired by the crown prince, the $600 billion fund board agreed not to exclude Israel from the list of potential investment destinations, setting a precedent for the public fund since it debuted offshore investing.

After locking approval from Saudi Arabia, Kushner and his team flew to Israel in March and held a series of meetings with Israeli firms in their quest for funding.

The former White House adviser is yet to announce which two firms will receive Saudi investments.

Saudi Arabia has not officially signed the Abraham Accord, but the country’s decision to approve the investment indicates a positive turn toward cooperation with Israel.

Other Middle Eastern countries had previously expressed their willingness to consider establishing diplomatic relations with Israel should it support the creation of a Palestinian state.

In addition to raising funds from Saudi Arabia, Kushner also aims to lock funds from Muslim-majority Indonesia, although the country does not currently sustain any form of diplomatic relations with Israel.

Kushner had previously announced plans to broker the creation of diplomatic relations between the two countries, but Trump’s presidency came to an end, terminating Kushner’s official role as a senior White House advisor.