Saudi investment fund PIF ‘has $300bn in assets and counting’

Saudi Arabia’s Vision 2030 reform plan is expected to transform the country’s key wealth fund into one of the world’s largest sovereign investment vehicles. (Shutterstock)
Updated 10 June 2019

Saudi investment fund PIF ‘has $300bn in assets and counting’

  • Boost in Kingdom’s wealth fund ‘will improve country’s international investment position,’ study shows

LONDON: Saudi Arabia’s key wealth fund has about $300 billion in assets and its growing size is set to “improve the country’s international investment position,” a new report has found.
Roughly a quarter of the Kingdom’s Public Investment Fund (PIF) holdings are overseas, with investments in companies like electric car maker Tesla and SoftBank’s Vision Fund, according to the Institute of International Finance (IIF) analysis. 
A raft of privatization deals and the planned $69 billion sale of a controlling stake in petrochemicals giant Saudi Basic Industries (SABIC) to Saudi Aramco is set to further boost the fund’s coffers, according to the IIF.
That means it is likely PIF will hit a target of $400 billion in assets by 2020, something the fund’s representatives have previously suggested is on track. 
“The expected further increase in the PIF’s assets abroad will improve the country’s international investment position,” the IIF report said.
“We now estimate PIF’s assets at about $300 billion, of which one-fourth are invested abroad, including in … Blackstone’s infrastructure fund, Egypt’s investment fund, Russia’s investment fund, and Uber. Proceeds from privatization (a target of about
$200 billion) and the eventual 5 percent sale of Aramco (a target of $100 billion) will further boost the PIF’s assets.”
However, the IIF noted that the privatization drive has been delayed due to legal impediments, concerns about implications for the labor market, and — in the case of the planned sale of a 5 percent stake in Saudi Aramco — regulatory procedures that need to be addressed.
The Vision 2030 reform plan envisions the transformation of the PIF into one of the world’s largest sovereign investment vehicles, managing $2 trillion by 2030. 
The Sovereign Wealth Fund Institute estimates PIF’s current assets at $320 billion, higher than the IIF’s assessment, making the Saudi entity the 10th largest fund of its type globally. Representatives of PIF did not immediately respond to a request for comment. 
The IIF report also found that Saudi Arabia’s holdings of US government bonds climbed to a peak of $170 billion in March 2019. The Kingdom has also “repositioned” its assets from euro and UK pounds to US dollars, the institute said.
“The increase in the Saudi appetite for US bonds coincided with relatively higher US yields and unfavorable investment sentiment in (emerging markets) and the euro zone,” the report noted.


Japan’s ANA Holdings says buying 20 more Boeing 787 Dreamliners

Updated 25 February 2020

Japan’s ANA Holdings says buying 20 more Boeing 787 Dreamliners

  • The price tag for the purchases was not disclosed
  • Planes expected to go into service between financial years 2022 and 2025

TOKYO: Japan’s ANA Holdings said Tuesday it will buy 20 new Boeing 787-10 and 787-9 aircraft, with the planes expected to go into service between 2022 and 2025.
The order will be made up of 11 787-10 aircraft, which will serve domestic routes, and nine 787-9 planes for international destinations.
The price tag was not disclosed.
All Nippon Airways has been gradually replacing its Boeing 777s with 787s, citing better fuel efficiency and a reduction in noise emissions.
Once all 20 of the newly ordered planes go into service, ANA will operate some 103 787s, the firm said.
“Boeing’s 787s have served ANA with distinction, and we are proud to expand our fleet by adding more of these technologically advanced aircraft,” said Yutaka Ito, executive vice president of ANA and ANA Holdings, in a statement.
“These planes represent a significant step forward for ANA as we work to make our entire fleet more eco-friendly and to reduce noise output,” Ito added.