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Written by Libby George
LONDON (Reuters) – Saudi Arabia’s public investment fund accounted for about a quarter of the roughly $124 billion spent by sovereign wealth funds around the world last year, a study revealed on Jan. 1. This was revealed in the report.
Based on the preliminary annual report from Global SWF, an industry expert that tracks sovereign wealth funds around the world, PIF spending in 2023 will be $31.5 billion, compared to a much larger total of $123.8 billion. is.
Last year’s strong rally in global stocks pushed assets under management by sovereign wealth funds around the world to a record $11.2 trillion.
Total government-controlled spending on the energy transition, from green hydrogen to lithium mining, also reached a record $25.9 billion in 2023, the report said.
Despite this, total spending by sovereign wealth funds last year was 21% lower than in 2022.
“This indicates an overly cautious approach, as there is no shortage of capital available for action among these institutions,” Global SWF Managing Director Diego López said in the report. There is a possibility.”
Singapore’s GIC, which has led wealth fund spending for the past six years, saw investment volumes fall by 48% in 2023, despite an inflow of $144 billion from the country’s central bank.
According to the Global SWF report, Gulf funds have been able to increase their trading advantage, mainly at the expense of Canadian and Singaporean funds. Gulf funds currently account for nearly 40% of the investments made by sovereign wealth funds.
Not all sovereign funds publish annual reports, and five of the top 10 do not reveal their exact total assets under management, so data provided by bodies such as the Global SWF is in the spotlight. There is.
games and sports
Although the Global SWF report does not provide details on individual investments by Saudi Arabia’s PIF, its lavish spending on soccer and golf has sent ripples through the sports world.
In June, Saudi Crown Prince Mohammed bin Salman announced that PIF would take control of the country’s four biggest soccer clubs: Al Ittihad, Al Ahly, Al Hilal, and Cristiano Ronaldo’s Al Nasr. did.
In June, Saudi Arabia surprised the golf world with a surprise merger agreement between the PGA Tour, DP World Tour and rival LIV Circuit, backed by Saudi PIF. That merger has not yet been completed.
Aside from splurges on sports, Saudi Arabia’s biggest investments have been in other areas, with 42% of this spending occurring domestically.
Big-ticket acquisitions include $4.9 billion for US gaming company Scopely, $3.6 billion for Standard Chartered’s aircraft leasing division and $3.3 billion for steelmaker Hadeed.
“The various transactions demonstrate the unparalleled bandwidth and reach of PIF and its subsidiaries, forming a wide net to capture all added value towards Saudi Vision 2030,” Lopez said. He mentioned the country’s economic transformation plan.
The Global SWR report also highlights PIF’s plans to launch its own electric vehicle brand with an airline. The fund holds $8.1 billion in stakes in gaming companies Activision Blizzard, Electronic Arts and Take-Two, as part of a plan to transform the country into a gaming hub, the report said.
Global SWFs predict that by 2024, the assets of all state-owned investors, including sovereign wealth funds, central banks and pension funds, will reach a previous peak of 50.8 trillion assets under management in 2021, taking into account paper profits. We expect it to exceed the US dollar. About last year.
(Additional reporting by Mark Jones; Editing by Jane Merriman)
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