Published: Thu, October 18, 2018
Money | By Hannah Jacobs

'Silicon Valley's Saudi Arabia Problem'

'Silicon Valley's Saudi Arabia Problem'

Saudi Arabia's shares plunged as much as 7 percent on Sunday as investors anxious about deteriorating relations with the global community after the disappearance of Saudi journalist Jamal Khashoggi.

Claure spoke at a technology conference in San Jose, California for British chip design firm Arm Holdings, which was acquired by SoftBank Group in 2016 for US$32 billion.

Saudi-backed SoftBank Group's Chief Operating Officer (COO) has announced that it is "business as usual" at companies backed by its almost $100 billion Vision, reported Reuters. Tech shares have retreated in the face of the US-China trade war, potentially jeopardising the value of SoftBank's portfolio companies.

In an "Silicon Valley's Saudi Arabia Problem", the New York Times outlines how liberal Silicon Valley tech firms struggle with the issue of taking money from Saudi Arabian investors while ignoring the countries many human rights violations.

"We are not liking how SoftBank has been trading and have made a decision to remove it from our recommended longs", senior strategist Amir Anvarzadeh of Asymmetric Advisers in Singapore wrote in a research note yesterday.

Mohammed bin Salman has carefully nurtured a public image of himself as a, distancing himself from Saudi leaders of the past.

Saudi Arabia is now facing growing worldwide pressure to explain the disappearance of Saudi journalist Jamal Khashoggi.

He said his bigger concern is the valuation of technology stocks.

SoftBank is also raising a second US$100 billion Vision Fund.

Saudi Arabia rejected threats of punishment, saying the kingdom would retaliate against any sanctions with "greater action", according to its official state news agency.

Khashoggi, a columnist for The Washington Post and Saudi royal insider-turned-critic, went missing after entering the Saudi consulate in Istanbul on October 2 to obtain paperwork that would allow him to marry his Turkish fiancée.

Dara Khosrowshahi, CEO at Uber Technologies Inc - which is now SoftBank's biggest bet, said last week he is no longer attending. Media sponsors, including CNN, have also withdrawn from the event, which is known as "Davos in the desert".

Saudi financial markets have come under pressure in the last few days as U.S. President Donald Trump has threatened to punish Riyadh if it turns out that Khashoggi was killed in the Saudi consulate in Istanbul as alleged by the Turkish authorities.

UK Foreign Secretary Jeremy Hunt and his German and French counterparts said "light must be shed" on Khashoggi's disappearance, and cautioned that the Saudi government was expected "to provide a complete and detailed response".

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