Saudi cabinet approves PIF framework

ApprovedThe government of Saudi Arabia has “approved the framework” of its sovereign wealth fund the Public Investment Fund (PIF). Further details of the approval and the framework have yet to be revealed and no comment has been made by either government officials or the fund’s directors as of yet. It has been a busy period for the PIF which is estimated to have at least $300 billion of assets under management but is aiming to increase that to $2 trillion by 2030 as part of an aggressive investment plan.  The fund is also reportedly talking to banks about a short-term bridging loan in the region of $8 billion to finance new investments, according to a Reuters news story. The loan period is expected to last less than a year by which time the PIF should have received the $69 billion it is due following the sale of its 70% stake in Saudi Basic Industries to Saudi Aramco, now the world’s largest energy company. Although no one from the PIF has officially commented, a statement sent to Reuters noted that the long-term strategy outlined in the PIF programme includes “four sources of finance, including capital injections and asset transfers by the government, retained investment returns, and loans and debt instruments”. The loan would be the second time the PIF has sought to borrow capital on the open market following an $11 billion international syndicated loan taken out in 2018 involving 15 international investment banks. ©2019 funds global mena

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