Saudi Arabia’s Public Investment Fund (PIF) is looking to find sustainable sources of income in the future, revealed Deputy Governor Yazeed Alhumied.
He said the sovereign wealth fund is seeking to serve as an effective investment tool for Saudi Arabia to diversify sources of income.
“PIF is an effective tool for enhancing Saudi Arabia’s efforts to diversify sources of income away from oil. It works to invest in feasible projects that contribute to finding sustainable sources of income in the future,” Alhumied told Asharq Al-Awsat.
“Over the past years, PIF has been able to achieve a positive impact on the local economy and maximize sustainable returns.”
“The fund doubled the size of its assets under management to currently reach more than SR1.8 trillion ($480 billion),” confirmed Alhumied.
Between 2017 and the end of the second quarter of 2021, PIF has helped launch ten new sectors. This resulted in the creation of more than 400,000 direct and indirect jobs.
Alhumied said that PIF’s selection of 13 priority sectors for investment follows specific criteria that included an evaluation based on global and local perspectives and analysis of market attractiveness and size, expected growth, and available opportunities.
“PIF has an important catalytic and integrative role by investing in new sectors that attract the private sector to develop them.”
“Over the next five years, PIF aims to focus on 13 vital and strategic local sectors,” revealed Alhumied.
According to the deputy governor, those sectors include aviation and defense, financial services, healthcare, food and agriculture, consumer and retail goods, real estate, entertainment, tourism and sports, transport and logistics, communications, media and technology, service facilities, and renewable energy.
Alhumied clarified that the evaluation of Saudi sectors prompts competitiveness on a regional and global scale. It also covers the sectors’ impact on the Saudi economy and helps in prioritizing sectors according to the national plan for transformation, Vision 2030.
PIF’s ambitious strategy, through which it launched promising sectors, contributes to empowering the private sector, affirmed Alhumied.
“PIF is very keen to contribute to the economic development in the Kingdom by activating and developing vital and promising sectors that contribute to empowering and strengthening the participation of the private sector,” he said.
“Indeed, it is one of the important elements of PIF’s business model, as it evaluates the impact of its investment initiatives on the private sector in a comprehensive and accurate manner,” he added.
The strategy creates many opportunities for the participation of the private sector as an investor and partner in PIF’s investments and as a supplier to its subsidiaries.
“PIF aims to increase the contribution to local content to 60%. This will have a direct impact on empowering the local private sector and creating jobs,” said Alhumied.
Alhumied stressed that PIF’s capital rotation program has numerable benefits.
“The process of capital rotation is an important and essential factor in developing the Saudi financial sector and attracting new investors,” he said.
“It is one of the most important objectives of PIF, which plays a major role in developing the Saudi financial market and increasing the participation of the private sector by creating an attractive investment environment for investors.”
Besides selling stakes in companies owned by PIF, the program reinvests proceeds in strategic sectors with an economic stimulus effect.
PIF is constantly working on evaluating its assets and establishing companies. Moreover, the fund also seeks to acquire assets, develop them, and subsequently sell them as mature investments.
“PIF has made significant strides in achieving many ambitious investments in its capacity as the main investment arm of Saudi Arabia,” noted Alhumied, adding that the fund’s strategy in the coming years will focus on launching several sectors and initiatives that contribute to achieving the Kingdom’s Vision 2030.