Madrid - Spain is in talks with sovereign wealth funds from several Gulf countries on them co-investing in projects financed by European aid in order to leverage the initial investment, Spanish Foreign Minister Arancha Gonzalez Laya said on Wednesday.
"They are very interested in projects of decarbonisation, digitalisation and modernisation of our productive structure at a time when Spain is entering this process of transforming its economy," she said during a video-call with foreign correspondents based in Spain. So far, the only condition on these investments under consideration is job creation in Spain, a senior official with knowledge of the management of the EU recovery plan told Reuters. The Gulf sovereign funds are "good connoisseurs of Spain and good investors," Gonzalez Laya added.
Spain will receive one of the biggest slices of European recovery funds in the coming years, up to 140 billion euros ($170 billion) of which about half will be in the form of grants. Through co-investment from private investors and sovereign funds, the Spanish government expects to increase the impact the funds will have on the economy. The projects eligible for the Next Generation, as the rescue fund is dubbed, have to meet investment criteria such as modernising the administration or sustainability.The Spanish government is eager to get local and foreign private investors to co-invest in the projects approved, Gonzalez Laya said. She mentioned United Arab Emirates' Mubadala sovereign wealth fund - already owner of stakes in Spanish oil company Cepsa and gas pipeline operator Enagas, Qatar's QIA, a main shareholder in Iberdrola and Saudi Arabia's Public Investment Fund (PIF). Last year, the government passed a decree giving it a veto on acquisition of stakes bigger than 10% in Spanish companies it deems 'strategic'.
Gonzalez Laya said this veto is "compatible" with the search for foreign investors. Gonzalez Laya is also seeking to increase Spanish companies' investment in the Gulf countries, particularly in infrastructure development. Spain's former king Juan Carlos was an active supporter of commercial relations between Spain and Arab Gulf countries. Since August, the father of the current Spanish head of state has lived in the UAE to distance the monarchy from questions about his financial situation.