Saudi Arabia’s PIF is fastest growing sovereign wealth fund globally: Governor

Saudi Arabia’s Public Investment Fund (PIF) Governor Yassir al-Rumayyan said on Tuesday that the fund is one of the largest sovereign wealth funds in the world and is the fastest growing, developing and acquiring among them.

Al-Rumayyan said that under the leadership of Saudi Arabia’s Crown Prince Mohammed bin Salman, the PIF has undergone a great transformation.

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“The fund’s achievements have contributed to achieving the financial and developmental sustainability of the Saudi economy, the fund invested during its previous years in more than 10 sectors, the fund’s efforts are not limited to developing the Kingdom’s wealth by investing in the most feasible projects, but also extending into new sectors,” al-Rumayyan added.

Al-Rumayyan said that the fund has made significant achievements between 2018-2020, the most prominent of which being that the fund has tripled the size of its assets under management by the end of 2020.

Among the direct strategic objectives of the PIF are maximizing the fund’s assets, launching new sectors, building strategic economic partnerships, and localizing technologies.

The Governor added that the fund aims to create more than 331,000 jobs and develop 13 local sectors.

“The percentage of Saudi leaders in the fund is 80 percent and the volume of spending in new projects will reach 250 billion annually, the fund’s investments are not only local but global” al-Rumayyan added.

Al-Rumayyan added that investments will be funded from four sources: The first is cash in the fund, assets that will arrive from the government and the state treasury, profits from current investments, and financing through loans and banks.

“There is no investment without risk, and we have a dedicated risk management department,” al-Rumayyan concluded.

Saudi Arabia’s Crown Prince Mohammed bin Salman announced on Sunday the Kingdom’s strategy for the PIF for the next five years.

The Crown Prince estimated that the total assets of the PIF exceed 7 trillion and 500 billion riyals in 2030, adding that the government is committed to pumping 150 billion riyals annually into Saudi Arabia’s economy from the fund itself.

The PIF also listed the following six targets set to be achieved by the sovereign wealth fund by 2025: Doubling Assets under Management (AUM) to reach $1.07 trillion, creating 1.8 million jobs, both directly and indirectly, focusing on 13 strategic sectors, investing at least $40 billion annually in the local economy, contributing $320 billion to non-oil GDP, and raising the local content contribution to 60 percent in PIF and its Portfolio companies.

Established in 1971, the role of the PIF has changed significantly since the introduction of Saudi Arabia’s Vision 2030 back in April 2016. Vision 2030 envisions the fund controlling more than $2 trillion in assets, which would make it the largest SWF in the world.

Since the plan calls for the PIF to become a massive investment vehicle to help move the Kingdom away from its historic reliance on oil revenue, the fund has already made great strides to diversify its investments. The PIF has invested in many big-ticket projects and institutions, such as the Blackstone Infrastructure Fund, Virgin Galactic, and the Softbank Vision Fund.

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