Here’s the complete transcript of Maria Bartiromo’s exclusive interview with Prince Alwaleed bin Talal al Saud.
MARIA BARTIROMO: Prince Alwaleed bin Talal al Saud is the nephew of King Abdullah. He's also the largest shareholder in Citigroup and among the world's richest men. He's also been outspoken about the Mideast region's need for reform. He joins me right now in an exclusive interview for a CNBC phone interview.
Your Highness, thank you very much for spending the time. Thanks for joining us.
Prince ALWALEED BIN TALAL AL SAUD: It's good and pleasure to be with you, Maria, as usual.
BARTIROMO: Prince Alwaleed, can you tell us what happened on the streets in Saudi Arabia today? Give us that first-hand look of exactly what went on…on this so-called day of rage.
Prince ALWALEED: OK, let me give you an exact, first-hand report of what happened today exactly in Saudi Arabia, and specifically in Riyadh. Well, today after the Friday prayer, when the so-called demonstrations were supposed to happen, I prayed with the king personally. And after we prayed, I personally visited the two locations that were said supposedly to have these demonstrations in. I went there. I saw in one of the locations three police cars, and the other one four police cars, and I didn't find a single human being there after the prayer. So in a nutshell, this whole thing was a tempest in a teacup.
And if you really followed today the press conference of President Obama, he said two very important points. One of them is any change has to happen—in any society has to happen from within the society, which I agree with. He also said something very important. He said each country is different. What--basically he was saying that Saudi Arabia is no Egypt, is no Libya and no Tunis, period. And I think Obama summarized it in a very clear manner.
He also said something else about oil. He said when Libya stopped its oil, or at least it went down at least to half its usual production, he said that Arab--other OPEC countries were prepared to cover that shortfall. And guess what, the bulk of that coverage came from Saudi Arabia. So this shows you the importance of Saudi Arabia and its stability internally, and how it reflects to the external stability of the whole world economies.
BARTIROMO: Prince Alwaleed, what are you hearing from the people? Do you worry that the type of protests that we're talking about may spread, even as the government has said demonstrations will go untolerated?
Prince ALWALEED: Let me tell you, the so-called day of rage should be changed to some other word, please. Should call it day of allegiance and love to the King Abdullah. Today if you're on the streets, people have the flags up, they were just themselves and say, `We will not tolerate and accept any sort of demonstration here. We're happy with our king, we love our king, and we will not accept any outside interference at all,' as Prince Saud al-Faisal said very openly in his press conference just two days ago. You know, we have issues, sure, internally, like any other country, and we had some demonstrations in the Shiite province in the east coast. And we had maybe around 40, 50 demonstrators yesterday. And the whole thing, you know, just faded away after they had discussion with the authorities over there. We had issues in the past, we resolved them internally and amicably. You know, when you have 40 million people going in the street and talking—and mingling with themselves, and authorities talk to them and disperse them amicably, this is not a demonstration. So really, this whole thing should be changed from day of rage to day of allegiance to the king.
BARTIROMO: Yeah, that's a great way to put it.
Let me ask you this. You recently wrote an op-ed, and you pointed to the need for meaningful reform in the Arab nations. What type of reform is necessary, in your view? You've already spoken out about women. For example, do you think women should have the right to drive in Saudi Arabia, Prince Alwaleed?
Prince ALWALEED: Oh, yeah. Oh, yeah. I mean, look, having said all that. King Abdullah is not going to take this for granted at all. King Abdullah is a reformer. King Abdullah is a reformer since he became the king almost five years ago. And it's a process, it's an ongoing process, you know. But each country has to advance and move at its own speed. You know, Saudi Arabia, you know, its constituency is not only the 16 million--the 20 million indigenous people here we have. So really, our constituency goes well beyond our borders. So King Abdullah has to balance all these things together. And sure enough, he's a reformer. And sure enough, we would like to make many changes internally. I mean, this show, for ladies driving, yes, I'm for it. And listen, the fact that I would publicly and openly, this shows that in Saudi Arabia there's an open debate. Actually, King Abdullah, under his supervision and guidance, has established a dialogue in Saudi Arabia whereby all the population, whether Shiite or Sunnis from north, south, west or east, they can get together and exchange their views. So really, we are heading the in right direction. Maybe not the same speed that you'd like us to, but each country has to move at the speed that it--that it needs. And exactly that's what President Obama said today, that each country should change in the Middle East at its own speed, its own pace, and without outside interference.
BARTIROMO: Prince Alwaleed, I want to ask you about the impact and the reaction from an investment standpoint. I know you have put your money where your mouth is in terms of investing when the market sold off earlier this week. But let me ask you first about Bahrain. A lot of speculation and debate about whether or not the Saudi government put troops into Bahrain to stop the protesters there. Are you worried about what's happening in Bahrain?
Prince ALWALEED: Well, sure. Whenever any Arab country, especially an emirate country, is facing some internal issues and strife, we will have to be concerned. I'm not sure about the word worried, but at least concerned. But on the issue of having our troops going to Bahrain, I can assure you that not a single Saudi member of the army or troops is available there because I--we believe that the Bahrainian government, under leadership of king of Bahrain and his able crown prince, will be able to solve the problem very amicably.
BARTIROMO: Let's talk about the supply of oil. Your Highness, you put money to work into the Saudi stock market. You believe the fall was not justified. What about the move in oil? Is the move in oil justified? And is there enough supply of oil in the world if in fact we do see this unrest continue and hit hot spots in terms of oil production?
Prince ALWALEED: Let us take the worst-case scenario. Let us say all of the production of Libya is off the market. So that's 1.5, 1.6 million barrels. Rest assured that Saudi Arabia can cover that within days. Actually, Saudi Arabia's production by one million within a week. Clearly, some other countries also assisted. But if all the product of Libya disappears tomorrow morning, one country called Saudi Arabia can cover it immediately. So we are the stabilizer. We are the ultimate stabilizer of oil. We have 25 percent of all proven oil reserves in the world, and we take that responsibility very aggressively. I mean, had we not raised our production, the price of oil now would be not only $100, could be $140, $150.
BARTIROMO: So based on where the supplies are now, the levels of supply, is oil justified at $100 a barrel?
Prince ALWALEED: It is not justified. This is a panic situation because people are concerned. They don't understand what's going on, they just are worried about what's happening in Libya. And I tell you openly, bluntly and blatantly, if all the production of Libya disappears, one country only, which is Saudi Arabia, can cover it immediately.
BARTIROMO: Right, absolutely.
Let me ask you about the investment that you made in the stock market, and then I want to get into your investment in Citigroup . You put money to work in the Saudi stock market as things were really plummeting earlier in the week. How do things stand, in your view, from a stability standpoint for the markets in the Arab nations?
Prince ALWALEED: Well, you know, about 10 days ago when we had all these civil strifes and problems around us, the Saudi market panicked and got scared and worried. So the market crashed by 22 percent. And just last week it recorrected upwards again by 15 percent when people looked at opportunities. And I went public and said wait a minute, this ridiculous. You need to look at the fundamentals of the Saudi economy; a Saudi economy that is growing by 45 percent excluding oil, a country that has almost half a trillion dollars of foreign reserves, a country that has an incredible amount of trade surplus. So all of the economists of this country is great. The economy is doing very well. The companies are doing very well. And thank God, all the, you know, the local investors understood that and they stabilized situation and got the market where it's supposed to be.
BARTIROMO: Prince Alwaleed, let me turn to your investment in Citigroup. You're the largest single individual shareholder. We had a number of prominent financial analysts on recently who said get out of Citi shares. The capital is going to be an issue, they're going to need to raise new capital. The dividend is questionable. Are you adding to your position in Citi right now?
Prince ALWALEED: I have--we have two positions. One position that's for me personally, and the other position for Kingdom Holding. And for sure we are happy and I'm in constant contact with Mr. Vikram and the high-ranking officials in the bank. We are very happy with what's going on over there. I can assure you that Citibank does not need one iota of increase in equity. It has adequate equity. And Vikram went public by saying that 2012 a share buyback program will be established and dividends will be reinstated. So Citibank's problems are behind us, and now we are pushing towards the future.
Prince ALWALEED: Hopefully if Mr. Vikram can give us some dividends 2011, we welcome that. But I go through you for that purpose.
BARTIROMO: Well, that's what we're waiting for. We're waiting on regulators to tell us what the capital requirements will be for the banking sector. So do you think that Citi will issue that dividend to shareholders in the next couple of quarters, three quarters? And what if they don't? What are you going to do, as the largest shareholder?
Prince ALWALEED: What I know is that--what Vikram went public with, saying that in the first quarter 2012 he'll have dividends. But clearly, as a shareholder, I would like to have dividends early. You know, I'm like any other shareholder who will push for dividends. But obviously, that's the call of Mr. Vikram and the management of Citibank, which I respect a lot.
BARTIROMO: And final question here, Your Highness. In terms of the Mideast unrest, what do you think happens next? Do you believe that we have seen the worst in terms of the protesting in Saudi, or do you believe that we are still working through this situation?
Prince ALWALEED: Well, I mean, clearly, you know, you have problems in Egypt, you have problems in Tunis, you have in Libya, and now there are some ongoing problems right now in Yemen. But as a result…have said that if you have four countries that have civil strife, you can't generalize. Because after all, we have 22 Arab countries. So four out of 20
is around 20 percent of Arab countries have some problems. We hope that this thing is not contagious and does not spread at all, and so far so good. But clearly, the Arab world has to look at the future and reflect the needs of its people. So just because certain countries are stable doesn't mean that they're--that the leaders have to take their--the population for granted. They have to also look out for the needs and to reform and take--and be in the driver seat.
BARTIROMO: Prince Alwaleed, the market moving, as we have been discussing, the unrest and the lack of upset on this day of rage. We thank you very much for joining us, Prince Alwaleed.
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