Saudi Arabia’s sovereign wealth fund is set to increase its annual deployment of capital to $70 billion a year after 2025.
The Public Investment Fund (PIF) currently puts $40- $50 billion of capital to work annually. The fund’s governor, Yasir Bin Othman Al-Rumayyan, said at the FII Priority conference in Miami that this is set to increase after 2025.
The fund invested about $100 billion in the US between 2017 – 2023 — creating more than 103,000 jobs there.
“PIF manages more than $700 billion and allocates more than 70% of its investments in Saudi Arabia. It’s targeting an allocation of 20% – 25% for international investments, with the absolute number increasing over time.”
PIF has invested heavily in golf, and in June the PGA Tour proposed a merger with Saudi-backed LIV Golf.
Al-Rumayyan emphasized the increased capital deployment will focus on “green field”, which is a new project or investment rather than existing ones in the secondary market. The intentions behind the project are not only to generate returns but to have meaningful impacts in things such as sustainability, education, artificial intelligence (AI) robotics, and healthcare.
While there is excitement about the increased capital deployment, there are concerns among global asset managers regarding how much of this funding will be allocated domestically versus internationally.
Some executives fear that a substantial portion may be directed towards local mega-projects like Neom – a $1.5 trillion development project- potentially limiting opportunities for international investments.
2024 Bloomberg L.P
