Mohammed bin Salman said the Public Investment Fund, which invests public money both in Saudi Arabia and abroad, is important for the oil-rich Middle Eastern country’s development.
“The Public Investment Fund has become one of the main engines for the growth of the Saudi economy, and we have been able to double the size of the fund from 560bn riyals to more than 1.3trn riyals,” Salman was reported as saying by the Saudi Press Agency.
In recent years, greater returns on investment (it achieves a minimum of 7%, with some investments exceeding 140%) have brought new sustainable sources of income, the crown prince said, meaning some of that money can be injected into the economy.
“In 2021 and 2022 the fund will pump approximately 150bn [riyals] annually into the Saudi economy, increasing each year until 2030,” Salman said.
“This liquidity will be provided by liquidating and recycling the fund’s investments to enter into new opportunities, creating a local economic cycle that enables the emergence of new sectors and contributes to providing new revenues for the state.”
The IMF projects Saudi Arabia’s GDP will shrink by 5.4% in 2020, because of the twin hits of Covid-19 and oil revenues plummeting at the beginning of the year.
Officials publicly recognise the need to reduce the government’s reliance on sales of fossil fuels, and Salman said the PIF can help to grow other parts of the Saudi economy.
“Diversification of revenues is vital for the state’s sustainability, and we are working on that seriously through the investments of the PIF and supporting new sectors such as tourism, sport, industry, agriculture, transportation, space and mining,” he said.
