According to a report released on January 1, Saudi Arabia’s Public Investment Fund contributed around 25% of the nearly $124 billion invested globally by sovereign wealth funds in the previous year.

Preliminary annual report from industry specialist Global SWF, which tracks global sovereign investment funds, shows that PIF spent a staggering $31.5 billion in 2023, compared to $123.8 billion for all sovereign wealth funds.

The robust increase in global stock prices last year contributed to the assets managed by sovereign wealth funds reaching a record $11.2 trillion globally.

According to the research, total sovereign-controlled investment on the energy transition, encompassing everything from lithium mining to green hydrogen, reached a record $25.9 billion in 2023.

In spite of this, the sovereign wealth funds spent 21% less overall in 2022 than they did in 2022.

“This may signal an overly cautious approach, as there is no shortage of capital to put to work among these institutions,” Global SWF managing director Diego López said in the report.

GIC, the wealth fund leader in Singapore for the previous six years, saw a 48% decrease in investments in 2023, even with a $144 billion infusion from the central bank of the nation.

According to the Global SWF study, Gulf funds were able to gain more dealmaking clout, mostly at the expense of Singaporean and Canadian funds. Currently, roughly 40% of the investment value made by sovereign wealth funds comes from Gulf funds.

Since not all sovereign funds publish yearly reports and five of the top ten do not disclose the precise amount of their assets under management, data from organisations like Global SWF is highly scrutinised.

Saudi Arabia’s PIF did not spell out specific investments in Global SWF’s report, but its extravagant spending on golf and football has caused a stir in the sports world.

The announcement was made in June by Saudi Crown Prince Mohammed bin Salman that PIF would assume ownership of Al-Ittihad, Al-Ahli, Al-Hilal, and Cristiano Ronaldo’s Al-Nassr, the top four football teams in the nation.

With a shocking merger agreement between the PGA Tour, DP World Tour, and rival LIV circuit—which is supported by the Saudi PIF—Saudi Arabia startled the golf world in June. The merger has not yet been completed.

The Kingdom’s largest investments, aside from its lavish spending on sports, were in other areas, with 42% of the money spent being spent domestically.

The largest purchases were $3.3 billion for the steelmaker Hadeed, $3.6 billion to acquire Standard Chartered’s aeroplane leasing subsidiary, and $4.9 billion for the American gaming company Scopely.

“The variety of deals shows the unparalleled bandwidth and reach of PIF and its subsidiaries, which are forming a wide net to capture any value-add for Saudi Vision 2030,” López said, referring to the country’s economic transformation plan.

The aspirations of PIF to establish an aircraft and its own brand of electric vehicles are also highlighted in the Global SWR report. According to the source, the fund is investing $8.1 billion in Activision Blizzard, Electronic Arts, and Take-Two, three gaming businesses, as part of its strategy to establish the nation as a gaming hub.

As they account for the paper gains of the previous year, Global SWF projects that assets for all state-owned investors, including sovereign wealth funds, central banks, and pension funds, will surpass a previous peak in 2021 of $50.8 trillion in assets under management in 2024.

(Adapted from TheDailyStart.net)