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BlackRock: Our Investments in Saudi Arabia Are Doubling, the $5 Bln from PIF Is Only the Beginning

BlackRock’s headquarters in Riyadh. (BlackRock)
BlackRock’s headquarters in Riyadh. (BlackRock)
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BlackRock: Our Investments in Saudi Arabia Are Doubling, the $5 Bln from PIF Is Only the Beginning

BlackRock’s headquarters in Riyadh. (BlackRock)
BlackRock’s headquarters in Riyadh. (BlackRock)

BlackRock is reinforcing its long-term investment strategy in Saudi Arabia, viewing the Kingdom as a cornerstone of its regional growth plans. Kashif Riaz, Managing Director for the Middle East and head of the BlackRock Riyadh Investment Management Platform, said the company’s partnership with Saudi Arabia’s Public Investment Fund (PIF) marks the beginning of a significant expansion in scale and scope.

The first five billion euros are only the beginning, he told Asharq Al-Awsat, referring to the landmark investment that established a multi-asset platform in the Saudi capital.

The five-billion-euro commitment stems from the strategic alliance announced last year between BlackRock and PIF.

Speaking on the sidelines of the Future Investment Initiative (FII) conference in Riyadh, which gathered leading figures from global finance and industry last week, Riaz said the collaboration is designed to grow exponentially as Saudi Arabia’s capital markets deepen and diversify.

During the same event, Larry Fink, BlackRock’s Chairman and CEO, noted that the strong global interest in Saudi opportunities reflects international confidence in the Kingdom’s economic reforms and transformation, which have positioned it among the top emerging destinations for foreign investment.

Riaz explained that BlackRock Riyadh has already begun managing equity funds focused on Saudi and Gulf markets, with strategies spanning both active and index-based portfolios.

The company has also built specialized teams for fixed income and sukuk, and recently concluded a major infrastructure deal with Saudi Aramco. The $11 billion (SR41 billion) transaction, finalized during the FII conference, involves developing the Jafurah gas field in partnership with a consortium led by Global Infrastructure Partners, a BlackRock subsidiary.

He said the Riyadh platform was created to connect local and international investors with opportunities in the Saudi economy. The country’s financial landscape, he noted, is undergoing rapid transformation as family offices and digital investment platforms emerge as new engines of growth alongside sovereign and pension funds.

The company’s objective is to make BlackRock funds accessible to a wide range of investors - institutional and individual - through digital channels and wealth management networks, he added.

As part of its technological innovation, BlackRock has launched an AI-driven investment fund that uses artificial intelligence and data science to analyze stocks listed on the Tadawul exchange. The system integrates financial data, corporate reports, and social media activity to generate a data-backed view of each company.

Riaz said this method reflects BlackRock’s long-established systematic investment approach, which has been refined over decades and adapted to Saudi Arabia’s unique market dynamics.

He also outlined a project being developed with the Saudi Real Estate Refinance Company (SRC) to establish a secondary mortgage market, enabling banks to securitize housing loans into asset-backed securities.

He said progress is well under way, following a pilot issuance in August conducted with the Saudi Central Bank and the housing sector. According to him, the new market will help banks expand lending for home ownership, infrastructure, and new developments, while offering international investors safe, well-regulated financial products.

Looking ahead, Riaz identified housing, renewable energy, artificial intelligence, data centers, transport, and logistics as the key sectors driving BlackRock’s strategy in Saudi Arabia over the coming decade.

He said the firm’s focus has shifted more toward infrastructure investment than private equity, supported by a specialized fund that targets major strategic projects across the Gulf region. The Jafurah partnership, he noted, is one example of this broader regional vision.

BlackRock’s infrastructure portfolio now spans digital infrastructure, renewable energy, gas, water-related industries, and logistics. Globally, the firm holds stakes in major airports, including London Gatwick and several in Malaysia, and has formed partnerships in port operations such as King Abdullah Port on Saudi Arabia’s Red Sea coast.

Beyond deploying capital, Riaz said BlackRock’s strategy in the Kingdom centers on developing local talent and expertise. The company currently employs about 40 people in Saudi Arabia, 80 percent of them nationals.

It has also launched a graduate hiring program that recruits Saudi university students domestically and abroad, several of whom now hold leadership positions. Some Saudi professionals have even returned from BlackRock’s New York offices to Riyadh to help expand the firm’s local capabilities.

BlackRock was the first major global asset manager to establish a regional headquarters in Riyadh. Its initiatives align closely with Saudi Vision 2030, which seeks to diversify the economy, attract foreign investment, and stimulate non-oil sectors.

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Business

EU's Six Biggest Economies Agree on Capital Markets Supervision

German Finance Minister Lars Klingbeil (L), Dutch Finance Minister Eelco Heinen (R) and Spanish Economy Minister Carlos Cuerpo attend a meeting with finance ministers from Germany, Italy, Spain, Poland, France and the Netherlands at the Deutsche Bundesbank recreation center in Berlin, Germany, 28 May 2026. (EPA)
German Finance Minister Lars Klingbeil (L), Dutch Finance Minister Eelco Heinen (R) and Spanish Economy Minister Carlos Cuerpo attend a meeting with finance ministers from Germany, Italy, Spain, Poland, France and the Netherlands at the Deutsche Bundesbank recreation center in Berlin, Germany, 28 May 2026. (EPA)
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EU's Six Biggest Economies Agree on Capital Markets Supervision

German Finance Minister Lars Klingbeil (L), Dutch Finance Minister Eelco Heinen (R) and Spanish Economy Minister Carlos Cuerpo attend a meeting with finance ministers from Germany, Italy, Spain, Poland, France and the Netherlands at the Deutsche Bundesbank recreation center in Berlin, Germany, 28 May 2026. (EPA)
German Finance Minister Lars Klingbeil (L), Dutch Finance Minister Eelco Heinen (R) and Spanish Economy Minister Carlos Cuerpo attend a meeting with finance ministers from Germany, Italy, Spain, Poland, France and the Netherlands at the Deutsche Bundesbank recreation center in Berlin, Germany, 28 May 2026. (EPA)

Finance ministers from the EU's six biggest economies (E6) agreed among themselves on Friday to support more centralized capital markets supervision, in a breakthrough crucial for deeper integration of Europe's fragmented capital markets.

The push for financial market players to be supervised at a European Union rather than national level is part of the EU's plan to redirect trillions of its citizens' savings, now idling in bank deposits, into more productive investment in Europe.

Access to such a large ‌amount of capital ‌for investment would boost the bloc's chances of competing against ‌the ⁠United States and China.

Supervision ⁠of significant market infrastructure would be gradually transferred to the European Securities and Markets Authority in Paris, the finance ministers of Germany, France, Italy, Poland, Spain and the Netherlands agreed after they met in Berlin on Thursday to discuss the issue.

The issue of handing over local powers to supervise trading platforms, central counterparties and central securities depositories to the EU has been difficult because of vested national interests and opposition from Ireland and Luxembourg and ⁠initially Germany.

But the issue will be decided by qualified ‌majority, meaning it needs the support of 15 ‌out of the EU's 27 countries representing 65% of the bloc's population.

With the backing of the ‌E6, which represent 70% of the EU's population, centralized supervision is now much ‌more likely to happen.

"The fact that the EU's six largest economies are prepared to leave national self-interest behind and move forward together is an important signal for the entire European Union," German Finance Minister Lars Klingbeil said in a statement.

ACCOUNTABILITY MUST BE ENFORCED

The European Commission presented its ‌plan to better integrate EU capital markets in December, and Germany's finance minister has said he expects the package to ⁠be adopted by ⁠the end of this year.

"In an uncertain international context, Europe needs deeper and more integrated capital markets," Spanish Finance Minister Carlos Cuerpo said. "This joint positioning is a decisive step towards a true savings and investment union."

ESMA's governance structure must be set up efficiently: expertise, supervisory and market experience, and geographical balance should play a decisive role, the ministers agreed in a paper seen by Reuters on Friday.

In addition, costs must be kept under control and accountability must be enforced, the joint paper said about the ESMA.

However, the paper said that in their current form and size, German trading venues would currently not be subject to mandatory European supervision authorities over trading in crypto-assets, and to reduce barriers to cross-border funds to help company financing, according to the paper.

Business

Saudi Fintech, Cloud Services Drive Technology Sector Profit Boom

Women walk through the lobby of Elm Co. in the Saudi capital Riyadh. (Public Investment Fund)
Women walk through the lobby of Elm Co. in the Saudi capital Riyadh. (Public Investment Fund)
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Saudi Fintech, Cloud Services Drive Technology Sector Profit Boom

Women walk through the lobby of Elm Co. in the Saudi capital Riyadh. (Public Investment Fund)
Women walk through the lobby of Elm Co. in the Saudi capital Riyadh. (Public Investment Fund)

Saudi Arabia’s listed technology companies posted strong first-quarter earnings for 2026, reflecting a structural shift in the sector as digital revenue growth converged with tighter control over operating and administrative costs.

Combined net profits for companies in the Kingdom’s applications and technology services sector rose 16% year-on-year to SAR1.07 billion ($285 million), up from SAR920 million ($245 million) in the same period last year. The performance underscores the sector’s growing ability to diversify revenue streams across cybersecurity, digital identity, managed services and cloud computing.

Analysts said the gains were fueled by the continued expansion of Saudi Arabia’s digital transformation programs, the rapid maturation of the fintech industry, infrastructure development and rising investment in cloud computing.

Strong corporate demand is also pushing the Kingdom’s information and communications technology market toward what analysts expect will exceed $100 billion in spending by 2031.

The sector includes five listed companies, four of which reported profits during the quarter: Elm Co., Solutions by stc, 2P Perfect Presentation and Al Moammar Information Systems Co. Bahr Al Arab Systems Information Technology continued to post quarterly losses through the end of the first quarter.

Elm accounted for roughly 61% of total sector profits, recording the highest net income at SAR656 million in the first three months of the year, up 32% from SAR495 million a year earlier. The company benefited from a 31% rise in revenue to SAR2.47 billion, in addition to lower research and development expenses.

Solutions by stc ranked second, posting profits of SAR370 million, up 2.5% from SAR361 million in the same quarter last year. The increase was supported by lower operating costs, reduced selling and administrative expenses, and a 6.3% rise in revenue to SAR3 billion.

2P Perfect Presentation came third in sector profitability, reporting net income of SAR33.06 million, up 2.4% from SAR32.28 million a year earlier. The company cited strong performance across most operating segments, particularly call center services, while revenue climbed 14% to SAR330.08 million.

The Saudi Data and AI Authority's (SDAIA) "Hexagon" data center, the largest government data center in the world. (SPA)

Five drivers behind the growth

Financial analyst Nasser Al-Rashid told Asharq Al-Awsat that the strong earnings growth reflects the intersection of several operational and strategic factors centered on five main pillars.

The first is sustained government and private-sector spending on digital transformation, which remains the sector’s largest growth engine, he explained. As government agencies and major corporations expand automation and strengthen digital infrastructure, demand has increased for technology solutions, data management, cybersecurity and cloud services, creating stable long-term revenue streams for companies with major public-sector contracts.

The second pillar is the rapid development of the fintech sector, which has accelerated adoption of digital payments, e-services, digital identity tools and smart business platforms. This has directly boosted recurring revenues and profit margins for technology and applications companies, Al-Rashid said.

Third, companies have improved operational efficiency, as reflected in lower operating and administrative costs and reduced sales and distribution expenses. This demonstrates that firms are not relying solely on revenue growth but are also improving profitability through tighter cost controls, he added.

The fourth driver is the expansion of cloud computing and data center services, among the industry’s most profitable activities, he continued.

Rising demand from businesses for cloud hosting, data analytics and managed services has increased returns on technology contracts as institutions reduce reliance on traditional infrastructure.

The fifth pillar is the diversification and quality of revenue streams, said Al-Rashid.

Major companies are no longer dependent on a single source of income but now generate returns from digital operations, cloud solutions, business platforms, call center services and systems management, reducing exposure to operational volatility and improving earnings sustainability, he went on to say.

Market analyst Tariq Al-Ateeq told Asharq Al-Awsat that Elm’s contribution of more than 60% of sector profits highlights the strength of its innovation-driven model built around government digital services, data and specialized solutions.

He added that the Saudi technology sector has formally entered a phase of “sustainable operational growth,” supported by Vision 2030, rapid digitalization and rising spending on technology infrastructure.

Al-Ateeq expects technology and applications companies to maintain solid earnings and revenue growth in coming quarters, albeit at a more balanced pace than in previous years.

The sector’s long-term expansion will continue to be driven by government digital transformation spending, the rapid growth of cloud and artificial intelligence services, and rising private-sector demand for automation, he remarked.

Business

Gold on Track for Third Straight Monthly Loss; Traders Assess US-Iran Ceasefire Reports

Gold bars displayed inside Comptoir National de l'Or store in Paris (Reuters)
Gold bars displayed inside Comptoir National de l'Or store in Paris (Reuters)
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Gold on Track for Third Straight Monthly Loss; Traders Assess US-Iran Ceasefire Reports

Gold bars displayed inside Comptoir National de l'Or store in Paris (Reuters)
Gold bars displayed inside Comptoir National de l'Or store in Paris (Reuters)

Gold was headed for a third straight monthly loss as the US-Israeli war on Iran kept concerns around inflation and US rate hikes elevated.

Spot gold rose 0.5% to $4,514.19 per ounce by 0610 GMT on Friday as investors assessed reports on reports of an extension to the US-Iran ceasefire extension. It had ‌fallen to a ‌two-month low of $4,365.76 on Thursday, but closed ‌higher.

The ⁠bullion is on ⁠track to lose 2.4% for the month and about 15% over three months.

US gold futures for August delivery inched 0.3% higher to $4,544.80.

"Yesterday, we saw gold went down to $4,360 and was likely to go down further until the (ceasefire) announcement came, due to which we suddenly saw the reversal of prices. This is where the market ⁠continues to be this morning," said GoldSilver Central Managing ‌Director Brian Lan.

"Markets are now ‌waiting for the deal to be signed even if it's only just ‌pending Trump's signature."

The United States and Iran reached an ‌agreement on Thursday to extend their ceasefire and lift restrictions on shipping through the Strait of Hormuz, sources told Reuters, though US President Donald Trump has yet to approve it and Iranian state media said it ‌had not been finalized.

Oil futures fell more than 1% on Friday and were on track for ⁠their steepest ⁠weekly decline since early April, easing some concerns around inflation driven by higher energy prices due to the Iran war.

US inflation increased at its fastest pace in three years in April, cementing economists' views that the Federal Reserve would hold interest rates unchanged well into next year.

While gold is considered a hedge against inflation, the non-yielding asset tends to come under pressure in a high-interest-rate environment.

Spot silver fell 0.1% to $75.55 per ounce and palladium gained 0.6% to $1,375.25, with both metals headed for a weekly gain. Platinum lost 0.4% to $1,915.30 and was on course for a weekly loss.