Saudi Arabia's Public Investment Fund plans to make cuts to its portfolio of foreign assets and focus more on domestic markets as it looks to establish the kingdom as the global hub of artificial intelligence, its governor said on Tuesday.
The sovereign wealth fund, with $930 billion of assets under management, plans to slash its foreign portfolio by about a third as “there is a big paradigm shift in how PIF is deploying investments”, Yasir Al Rumayyan said.
“Initially we had less than 2 per cent investments internationally and that was when we had $150 billion in [assets under management] … and it grew all the way up to 30 per cent. Now our target is to bring it down to between 18 and 20 per cent,” he told delegates at a panel discussion at the Future Investment Initiative conference in Riyadh.
“Having said that, the absolute dollar amount is still growing because our AUMs are still growing. So, it is down as a percentage term, but dollar value is rising.”
Mr Al Rumayyan was joined for the panel discussion on geoeconomics by global corporate leaders including Moderna chief executive Stéphane Bancel, head of BlackRock Laurence Fink, Citadel founder Kenneth Griffin, Sanofi boss Paul Hudson, president of Alphabet and Google Ruth Porat, Facebook co-founder Eduardo Saverin, as well as chairman of Blackstone Group Stephen Schwarzman and Carlyle co-founder David Rubenstein.
Paradigm shift
The initial investment days are behind the PIF, when global investors sought its funds to invest outside the kingdom. That trend has changed to co-investments in the kingdom and the PIF has created many joint ventures with its international partners, he said.
“In the beginning, a lot of people [would] come for our money and wanted it to be invested, but that trend has shifted over the years. We are now more focused on the domestic economy and we have achieved so many things,” Mr Al Rumayyan said.
Over the past eight or nine years, the projects the sovereign fund has invested in have hit operation and commercial stage. Now there is a discernible difference in the perception of the kingdom as an economy and a destination of investment from how it was viewed in 2015 and before.
“We have established 92 new companies: Neom, Red Sea Development, Aalat … all of these companies are big investors in new sectors that were not in existence in Saudi Arabia,” he added.
In August, the PIF said its assets under management jumped 29 per cent to 2.87 trillion Saudi riyals ($765 billion) in 2023 as it solidified its Saudi holdings and diversified its international portfolio of assets.
The annualised returns for the sovereign fund since 2017 rose to 8.7 per cent in 2023, up from 8 per cent a year earlier, the fund said in its annual report.
The shareholders' returns were “primarily driven by investments within Saudi Arabia, as well as international portfolio growth, as the PIF continued to forge strong partnerships and enhance shareholder value”, the fund said at the time.
Saudi Arabia, which is diversifying its economy away from oil, continues to maintain its appeal as a foreign direct investment destination, despite a sharp increase in geopolitical uncertainty in the region, which underpins the fact that Vision 2030 programme is working.
“The tailwinds are much stronger than the headwinds,” Khalid Al Falih, the kingdom’s Minister of Investment, said during a separate panel discussion.
Saudi Arabia’s non-oil economy has grown consistently between 4 to 5 per cent annually since 2017, including last year, and 540 companies have committed to establish their regional headquarters in the kingdom. This is ahead of the government's target of 500 by 2030.
“I'm glad to announce for the first time that we've reached 540 by this morning and some of them are the major multinational companies that are with us today, and they will be individually announcing their RHQs,” Mr Al Falih said. “This is an opportunity for companies to come and partner with us and address the challenges that we want to address.”
AI Investments
Among the new economy sectors, AI has emerged as the biggest focus area and the PIF aims to deploy more capital on investment opportunities in the sector, Mr Al Rumayyan said.
“As part of our AI investment, like most of the people around this table, we have ongoing discussions or potential discussions to invest in AI,” Mr Al Rumayyan said. “The reason why we are investing in AI is that Saudi Arabia is very well positioned to be a global hub and not just be a regional hub in the AI sphere,” he said. The abundance of land and the low cost of energy in the kingdom complements its ambitions as a global AI leader, he added.
The PIF governor said AI could contribute nearly $20 trillion to the global economy by 2030, with the role of the future tech as an economic driver becoming a benchmark of national power. “Artificial general intelligence marks the next frontier, promising machines capable of problem-solving and driving productivities that will impact every sector from health care to energy,” he told FII delegates.
Saudi Arabia has plans to create a fund of about $40 billion to invest in AI, and the PIF has held discussions with US venture capital company Andreessen Horowitz and other financiers to drum up interest, according to media reports in March.
Impact on capital markets
Mr Griffin of Citadel said AI has already made a telling impact on global financial markets and it will continue to drive growth in major companies across industries. The future tech is going to be “one of the dominant themes”.
Investments in AI are blossoming. “I really do believe this is going to be powering the equity markets for the coming years,” he said.
“It will present some social issues around the world, but the global theme is the need to deploy more capital to rebuild our infrastructure, to build out AI. It's going to be powering a real, tremendous investment movement, to be powering large-capitalised companies.”
With AI adoption, BlackRock, one of the biggest asset managers in the world, managed to add more than $5 trillion in assets, but did not have to add employees to match that growth.
“We actually added four multiple points in margins, and all of that is the utilisation of more technology,” Mr Fink told delegates. “I think to service our clients as well as we're doing, to have the trading volume that we are instituting, it just requires more and more technology. And then the algorithms we're using now, in terms of getting different indications, different mechanisms to invest, is really helping the power of the firm.”
If you go
The flights
Etihad (etihad.com) flies from Abu Dhabi to Luang Prabang via Bangkok, with a return flight from Chiang Rai via Bangkok for about Dh3,000, including taxes. Emirates and Thai Airways cover the same route, also via Bangkok in both directions, from about Dh2,700.
The cruise
The Gypsy by Mekong Kingdoms has two cruising options: a three-night, four-day trip upstream cruise or a two-night, three-day downstream journey, from US$5,940 (Dh21,814), including meals, selected drinks, excursions and transfers.
The hotels
Accommodation is available in Luang Prabang at the Avani, from $290 (Dh1,065) per night, and at Anantara Golden Triangle Elephant Camp and Resort from $1,080 (Dh3,967) per night, including meals, an activity and transfers.
Citizenship-by-investment programmes
United Kingdom
The UK offers three programmes for residency. The UK Overseas Business Representative Visa lets you open an overseas branch office of your existing company in the country at no extra investment. For the UK Tier 1 Innovator Visa, you are required to invest £50,000 (Dh238,000) into a business. You can also get a UK Tier 1 Investor Visa if you invest £2 million, £5m or £10m (the higher the investment, the sooner you obtain your permanent residency).
All UK residency visas get approved in 90 to 120 days and are valid for 3 years. After 3 years, the applicant can apply for extension of another 2 years. Once they have lived in the UK for a minimum of 6 months every year, they are eligible to apply for permanent residency (called Indefinite Leave to Remain). After one year of ILR, the applicant can apply for UK passport.
The Caribbean
Depending on the country, the investment amount starts from $100,000 (Dh367,250) and can go up to $400,000 in real estate. From the date of purchase, it will take between four to five months to receive a passport.
Portugal
The investment amount ranges from €350,000 to €500,000 (Dh1.5m to Dh2.16m) in real estate. From the date of purchase, it will take a maximum of six months to receive a Golden Visa. Applicants can apply for permanent residency after five years and Portuguese citizenship after six years.
“Among European countries with residency programmes, Portugal has been the most popular because it offers the most cost-effective programme to eventually acquire citizenship of the European Union without ever residing in Portugal,” states Veronica Cotdemiey of Citizenship Invest.
Greece
The real estate investment threshold to acquire residency for Greece is €250,000, making it the cheapest real estate residency visa scheme in Europe. You can apply for residency in four months and citizenship after seven years.
Spain
The real estate investment threshold to acquire residency for Spain is €500,000. You can apply for permanent residency after five years and citizenship after 10 years. It is not necessary to live in Spain to retain and renew the residency visa permit.
Cyprus
Cyprus offers the quickest route to citizenship of a European country in only six months. An investment of €2m in real estate is required, making it the highest priced programme in Europe.
Malta
The Malta citizenship by investment programme is lengthy and investors are required to contribute sums as donations to the Maltese government. The applicant must either contribute at least €650,000 to the National Development & Social Fund. Spouses and children are required to contribute €25,000; unmarried children between 18 and 25 and dependent parents must contribute €50,000 each.
The second step is to make an investment in property of at least €350,000 or enter a property rental contract for at least €16,000 per annum for five years. The third step is to invest at least €150,000 in bonds or shares approved by the Maltese government to be kept for at least five years.
Candidates must commit to a minimum physical presence in Malta before citizenship is granted. While you get residency in two months, you can apply for citizenship after a year.
Egypt
A one-year residency permit can be bought if you purchase property in Egypt worth $100,000. A three-year residency is available for those who invest $200,000 in property, and five years for those who purchase property worth $400,000.
Source: Citizenship Invest and Aqua Properties
Desert Warrior
Starring: Anthony Mackie, Aiysha Hart, Ben Kingsley
Director: Rupert Wyatt
Rating: 3/5
UAE currency: the story behind the money in your pockets
Tailors and retailers miss out on back-to-school rush
Tailors and retailers across the city said it was an ominous start to what is usually a busy season for sales.
With many parents opting to continue home learning for their children, the usual rush to buy school uniforms was muted this year.
“So far we have taken about 70 to 80 orders for items like shirts and trousers,” said Vikram Attrai, manager at Stallion Bespoke Tailors in Dubai.
“Last year in the same period we had about 200 orders and lots of demand.
“We custom fit uniform pieces and use materials such as cotton, wool and cashmere.
“Depending on size, a white shirt with logo is priced at about Dh100 to Dh150 and shorts, trousers, skirts and dresses cost between Dh150 to Dh250 a piece.”
A spokesman for Threads, a uniform shop based in Times Square Centre Dubai, said customer footfall had slowed down dramatically over the past few months.
“Now parents have the option to keep children doing online learning they don’t need uniforms so it has quietened down.”
Trump v Khan
2016: Feud begins after Khan criticised Trump’s proposed Muslim travel ban to US
2017: Trump criticises Khan’s ‘no reason to be alarmed’ response to London Bridge terror attacks
2019: Trump calls Khan a “stone cold loser” before first state visit
2019: Trump tweets about “Khan’s Londonistan”, calling him “a national disgrace”
2022: Khan’s office attributes rise in Islamophobic abuse against the major to hostility stoked during Trump’s presidency
July 2025 During a golfing trip to Scotland, Trump calls Khan “a nasty person”
Sept 2025 Trump blames Khan for London’s “stabbings and the dirt and the filth”.
Dec 2025 Trump suggests migrants got Khan elected, calls him a “horrible, vicious, disgusting mayor”
COMPANY%20PROFILE
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Key findings of Jenkins report
- Founder of the Muslim Brotherhood, Hassan al Banna, "accepted the political utility of violence"
- Views of key Muslim Brotherhood ideologue, Sayyid Qutb, have “consistently been understood” as permitting “the use of extreme violence in the pursuit of the perfect Islamic society” and “never been institutionally disowned” by the movement.
- Muslim Brotherhood at all levels has repeatedly defended Hamas attacks against Israel, including the use of suicide bombers and the killing of civilians.
- Laying out the report in the House of Commons, David Cameron told MPs: "The main findings of the review support the conclusion that membership of, association with, or influence by the Muslim Brotherhood should be considered as a possible indicator of extremism."
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
