Saudi Arabia’s affluence pool retreats from international investments

Saudi Arabia’s sovereign affluence pool plans to scale back the distribute of its international investments by about a third, drawing a line under the history decade’s multibillion-dollar global spending spree as it refocuses on the domestic economy.

The community pool pool, which has about $930bn worth of assets, said it intended to cut the proportion of funds invested overseas to between 18 and 20 per cent, down from 30 per cent.

PIF governor Yasir al-Rumayyan told the upcoming pool Initiative conference on Tuesday in Riyadh that initially most of the pool’s investments were domestic Saudi projects.

“But then [the proportion of international investments] increased from 2 per cent all the way up to 30 per cent,” he added. “Now our target is to bring it down to a range between 18 to 20 per cent.”

As the PIF comes under pressure to deliver returns and on its vast array of domestic commitments, it has been putting more conditions on mandates for pool managers, telling them it wants to view more pool in Saudi Arabia if it is going to commit to recent funds.

The affluence pool has already sold down its stake in BlackRock, and disposed of its holdings in Carnival, the cruise liner business, and entertainment throng Live country.

According to filings at the US stocks and bonds and swap percentage, the PIF’s traded stocks in the US fell from about $35bn at the complete of 2023 to $20.5bn on March 31, before stabilising in the second quarter at $20.6bn.

The PIF has been at the heart of a major schedule launched by Saudi Crown Prince Mohammed bin Salman to diversify the kingdom’s economy away from its dependence on oil revenues.

It had previously made waves with a string of high-profile deals, including pumping $45bn into SoftBank’s imagination pool in 2016 and $20bn into a Blackstone infrastructure pool the following year.

The pool has also made splashy acquisitions including Newcastle United football club and bankrolled ventures such as the LIV Golf professional tour.

Rumayyan said international investors who had previously sought capital from the PIF were also shifting their way.

“We’re more concentrated on the domestic economy and we’ve been achieving and doing so many large things,” he said. Now, he said, there were more “calls for co-investments” with the PIF instead of “people who desire us to invest or receive our money”.

Rumayyan did not declare when the PIF aims to meet its recent target for international investments.