London, Jan 1 (Job Freaker) – On January 1, a report revealed that Saudi Arabia’s Public Investment Fund played a big part in the nearly $124 billion spent by sovereign wealth funds globally last year, making up around 25% of the total amount.
In 2023, PIF’s significant expenditure of $31.5 billion stands out when compared to the total of $123.8 billion spent by all sovereign wealth funds. This data is sourced from the initial annual report by Global SWF, a renowned expert in tracking the activities of the world’s sovereign investment funds.
The global stock surge in the previous year contributed to a record $11.2 trillion in assets managed by sovereign wealth funds worldwide. The report highlights a historic high of $25.9 billion in sovereign-controlled spending on the energy transition, covering activities like green hydrogen and lithium mining in 2023. However, it’s worth noting that despite these records, the overall spending by sovereign wealth funds in 2023 was 21% lower than in 2022.
The report suggests a possibly overly cautious stance among these institutions, given the abundance of available capital, as noted by Diego López, the managing director of Global SWF. Singapore’s GIC, a leading spender for the past six years, reduced its investments by 48% in 2023, despite a substantial $144 billion inflow from the country’s central bank. Notably, Gulf funds expanded their dealmaking influence, overtaking Canadian and Singaporean funds, and now represent almost 40% of the investment value deployed by sovereign wealth funds.
Information from organizations like Global SWF is closely monitored, given that not all sovereign funds publish annual reports. Interestingly, five out of the top 10 sovereign funds do not disclose the precise total of their assets under management, making such data particularly valuable for understanding the landscape of sovereign wealth funds.
GAMING AND SPORT
While Global SWF’s report didn’t provide specific details on individual investments by Saudi Arabia’s PIF, the fund’s notable expenditures in soccer and golf have captured attention in the sports realm. In June, Saudi Crown Prince Mohammed bin Salman declared that PIF would assume control of the nation’s four major soccer clubs—Al-Ittihad, Al-Ahli, Al-Hilal, and Cristiano Ronaldo’s Al-Nassr—making a significant impact on the sporting landscape.
In a surprising move in June, Saudi Arabia made headlines in the golf world by proposing a merger between the PGA Tour, DP World Tour, and the competing LIV circuit, supported by the Saudi PIF. However, the finalization of this merger is still pending.Beyond sports, the Kingdom’s major investments span various sectors, with 42% of this spending directed domestically. Notable acquisitions included a $4.9 billion investment in the U.S. gaming company Scopely, a $3.6 billion purchase of Standard Chartered’s aircraft leasing division, and a $3.3 billion investment in the steelmaker Hadeed.
Diego López notes that the diverse range of deals underscores the extensive capabilities of PIF and its subsidiaries, strategically casting a wide net to align with the goals of Saudi Vision 2030, the nation’s economic transformation plan.
The Global SWF report also outlines PIF’s ambitions, including plans to launch an airline and develop its own electric vehicle brand. With an $8.1 billion stake in gaming giants like Activision Blizzard, Electronic Arts, and Take-Two, the fund aims to position Saudi Arabia as a gaming hub.
Looking ahead to 2024, Global SWF anticipates state-owned investors, including sovereign wealth funds, central banks, and pension funds, to surpass the previous peak of $50.8 trillion in assets under management reached in 2021, factoring in the gains made over the past year.
