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10 December 2023

Saudi sets up wealth fund

By Agencies




Saudi Arabia is planning to set up a new sovereign wealth fund worth $6 billion (Dh22bn) because its main investment focus is on domestic projects, the central bank governor was quoted as saying this week.


“At this stage the sovereign wealth fund is on the drawing board and it’s not going to be sizeable. It will be around $6bn only and managed by the Public Investment Fund,” Hamad Al Sayyari, head of the Saudi Arabian Monetary Agency (Sama), or central bank, told the Oxford Business Group in a report sent to a news agency on Friday.


Some Western politicians have expressed concern about how the authorities in countries such as China, Russia and the Gulf states, which have amassed huge reserves from trade surpluses, will manage foreign investment of their wealth funds, especially in the United States and Europe.


The Abu Dhabi Investment Authority (Adia), run by the emirate of Abu Dhabi in the United Arab Emirates, is thought to be the largest sovereign fund in the world, controlling assets of more than $900bn.


Friday’s Sama report said Saudi Arabia’s main concern is “to focus on domestic development and infrastructure, economic diversification and job creation”.


Sayyari’s deputy, Mohammed Al Jasser, said in January the Kingdom, the world’s biggest oil exporter and a key US ally, was planning to set up the fund.


Apart from the planned fund, Saudi government officials and businessmen have already expanded investments abroad in recent years. (Reuters)