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Saudi Arabia’s Sovereign Fund Invested $1 Billion In An American Electric Car Manufacturer

Saudi Arabia's 33-year-old Crown Prince Mohammed bin Salman has talked about using the PIF to help diversify the economy of the kingdom.

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Derek Jenkins, VP of Design at Lucid Motors, introduces the alpha prototype of the Lucid Air at the 2017 New York International Auto Show in New York City. VOA
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Saudi Arabia’s sovereign wealth fund invested $1 billion Monday in an American electric car manufacturer just weeks after Tesla CEO Elon Musk earlier claimed the kingdom would help his own firm go private.

Tesla stock dropped Monday on reaction to the news, the same day that the Saudi fund announced it had taken its first loan, an $11 billion borrowing from global banks as it tries to expand its investments.

The Saudi Public Investment Fund said it would invest the $1 billion in Newark, California-based Lucid Motors.

Lucid Motors
Lucid Motors. Flickr

The investment “will provide the necessary funding to commercially launch Lucid’s first electric vehicle, the Lucid Air, in 2020,” the sovereign wealth fund said in a statement. “The company plans to use the funding to complete engineering development and testing of the Lucid Air, construct its factory in Arizona, enter production for the Lucid Air to begin the global rollout of the company’s retail strategy starting in North America.”

Lucid issued a statement quoting Peter Rawlinson, its chief technology officer, welcoming the investment.

“At Lucid, we will demonstrate the full potential of the electric-connected vehicle in order to push the industry forward,” he said.

The decision comes after Musk on Aug. 7 tweeted that he had “funding secured” to take Tesla private. Investors pushed Tesla’s shares up 11 percent in a day, boosting its valuation by $6 billion.

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Electric Car

There are multiple reports that the U.S. Securities and Exchange Commission is investigating the disclosure, including asking board members what they knew about Musk’s plans. Experts say regulators likely are investigating if Musk was truthful in the tweet about having the financing set for the deal. Musk later said the Saudi Public Investment Fund would be investing in the firm, something Saudi officials never comment on.

Meanwhile Monday, the sovereign wealth fund known by the acronym PIF said it had taken its first loan, an $11 billion borrowing. It did not say how it would use the money, only describing it as going toward “general corporate purposes.”

Also Read: Electric Cars: The Newest Trend in India

The Las Vegas-based Sovereign Wealth Fund Institute estimates the Saudi fund has holdings of $250 billion. Those include a $3.5 billion stake in the ride-sharing app Uber.

Saudi Arabia’s 33-year-old Crown Prince Mohammed bin Salman has talked about using the PIF to help diversify the economy of the kingdom, which relies almost entirely on money made from its oil sales. (VOA)

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Many Countries Refused To Endorse Landmark Study as Climate Conference Enters Second Week

The environmental ministers arrive at COP24 and many delegates hope that they will make every effort to include the IPCC report in the conference agenda.

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Climate Change
Climate activists attend the March for Climate in a protest against global warming in Katowice, Poland, Saturday, Dec. 8, 2018, as the COP24 UN Climate Change Conference takes place in the city. VOA

As the U.N. global climate conference in Katowice, Poland entered its second week Sunday, the non-governmental environmental organization Greenpeace demanded urgent action from world leaders to tackle climate change.

Greenpeace activists projected a message onto the roof of the “Spodek” arena where the COP24 is being held, saying “No Hope Without Climate Action: and “Politicians Talk, Leaders Act.”

 

Amazon, Climate
Logs that were illegally cut from Amazon rainforest are transported on a barge on the Tapajos river, a tributary of the Amazon, near the city of Santarem, Para state. VOA

 

Disappointing many of the scientists and delegates at the conference, the United States, Russia, Saudi Arabia and Kuwait refused to endorse a landmark study on global warming which was to be the benchmark for future action in curbing the global warming.

The four nations wanted only to “note” but not “welcome” the report of the Intergovernmental Panel on Climate Change that was released in October, in keeping with the views of the Trump administration. With no consensus on including the report, the idea was dropped.

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In this photograph released by the Sri Lankan Air Force media division on May 29, 2017, flooding is seen in the country’s Matara district. VOA

U.S. President Donald Trump, who has announced he is pulling the United States out of the Paris climate agreement, tweeted Saturday that “people do not want to pay large sums of money … in order to maybe protect the environment.”

The IPCC’ report said that drastic actions would be needed to achieve the Paris accord’s most ambitious target of keeping global warming below 1.5 degrees Celsius. The report warned that the world was far from that target and heading more towards an increase of 3 degrees Celsius.

Also Read: To Help Poor Countries Adapt To Global Warming, World Bank Doubles Its Funding

On Monday, the environmental ministers arrive at COP24 and many delegates hope that they will make every effort to include the IPCC report in the conference agenda. (VOA)