Saudi Arabia’s Public Investment Fund Tops Global Sovereign Wealth Fund Spending in 2023

Saudi Arabia’s Public Investment Fund (PIF) emerged as the leading spender among global sovereign wealth funds in 2023, accounting for approximately a quarter of the $124 billion invested by state-owned investors, according to a preliminary report by research consultancy Global SWF.

The Saudi fund significantly increased its deal activities from $20.7 billion in 2022 to $31.6 billion in 2023, while many other counterparts reduced their spending. Despite a rally in most major stock markets, global sovereign wealth funds deployed 20% fewer funds compared to 2022.

The report suggested that this cautious approach to spending, despite the availability of ample capital, was notable among sovereign wealth funds worldwide.

The Public Investment Fund (PIF), under the control of Saudi Crown Prince Mohammed bin Salman, boasts total estimated assets of $776 billion. The fund has been actively pursuing deals and joint ventures as part of its Vision 2030 initiative, launched in 2016, which aims to diversify the economy away from oil. Notable overseas investments in 2023 included ventures with Nintendo in Japan and Vale Basic Materials in Brazil, reflecting PIF’s increased prominence globally.

Apart from PIF, four other Gulf Cooperation Council (GCC) funds secured spots in the top 10, namely Mubadala, the Qatar Investment Authority, ADQ, and the Abu Dhabi Investment Authority.

Surpassing Singapore’s GIC, which led wealth fund spending for the previous six years, the PIF’s remarkable performance marked a shift in the spending landscape. The Singaporean fund reduced its investment activity by 37%, in terms of volume, despite receiving significant inflows from the central bank.

The report also highlighted the renewed interest in emerging markets among several sovereign investors in 2023. Countries such as Saudi Arabia, Türkiye, the UAE, India, Brazil, China, and Indonesia drew attention from sovereign wealth funds.

Looking ahead to 2024, the report anticipated the emergence of more sovereign wealth funds, including Hong Kong’s HKIC, the Philippines’ Maharlika, and Pakistan’s PSWF. The formation of Dubai’s new sovereign wealth fund, DIF, was expected to have a notable impact, potentially attracting personnel from other sovereign wealth funds.

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