Saudi Arabia’s Public Investment Fund (PIF) plans to cut foreign investment by about a third, the fund’s president, Yasir al-Rumayan, announced at a conference in Riyadh on Tuesday. The PIF is refocusing on the country’s economic growth and intends to reduce international investment from the current 30% to 18-20%.
The PIF, valued at $925 billion, is a key tool in Crown Prince Mohammed bin Salman’s strategy to diversify the Saudi economy and reduce traditional Saudi dependence. The fund has helped finance a number of “megaprojects” aimed at developing new industries and creating sustainable revenue sources. However, Al Rumayyan noted that some of these projects have been scaled back due to rising costs.
The announcement was made during the annual Future Investment Initiative (FII) Summit, which brings together global business, technology and finance leaders in Riyadh. The summit serves as a platform for establishing relationships with Saudi Arabia’s largest companies and PIFs. This year’s event is also being seen as a barometer of investor interest in Saudi Arabia amid concerns about potential conflict in the Middle East.
Mr. Al Rumayyan highlighted the strategic shift in PIF’s investment approach, moving from direct investments to establishing joint ventures with both international and local companies. This approach is exemplified by Mizuho Bank (TYO:)’s decision to establish a regional headquarters in Riyadh’s King Abdullah Financial District (KAFD), said its CEO Masahiko Kato.
Saudi Arabia’s Minister of Investment Khalid Al Farih announced that the number of foreign companies with regional headquarters in the country has exceeded the target of 500 by 2030, reaching 540. This milestone underscores Saudi Arabia’s attractiveness as a regional business hub.
Energy Minister Abdulaziz bin Salman reaffirmed Saudi Arabia’s commitment to maintain oil production capacity at 12.3 million barrels per day and emphasized the continued importance of oil to the national economy.
The FII Summit will include Moderna CEO Stéphane Bancel, Alphabet (NASDAQ:) President and CIO Ruth Porat, and major banks including Citi, Goldman Sachs (NYSE:), and Morgan Stanley (NYSE:). Prominent speakers participated, including CEOs of Discussions at the summit covered topics such as artificial intelligence, the US presidential election and economic forecasting, with little focus on regional conflicts.
Elon Musk, who joined the conference via video conference, spoke about the future of artificial intelligence and space exploration. He predicted that humanoid robots could cost between $20,000 and $25,000 by 2040, which could significantly boost Tesla’s (NASDAQ:) valuation. Musk envisions the Optimus robot, which Tesla is currently developing, to be a transformative product for the company.
With the U.S. presidential election a week away, Citadel CEO Ken Griffin has suggested that the market expects Donald Trump to win over Democratic Vice President Kamala Harris, while Steve Schwartzman, CEO of Blackstone (NYSE:) and a Trump supporter, expressed his belief that Trump is more understanding. of the presidency.
Bank executives at the summit were optimistic about a surge in corporate deals next year, with Morgan Stanley CEO Ted Pick predicting a global IPO boom and Goldman Sachs’ David Pick predicting a global IPO boom. – CEO Solomon was waiting for more activity.
Concerns about inflation were also a topic of discussion, with several executives, including BlackRock (NYSE:) CEO Larry Fink, saying inflation could become more entrenched in the global economy than previously thought. He acknowledged that there is a need to reassess central bank policy on inflation. .
Reuters contributed to this article.
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