Saudi sovereign wealth fund takes US$11bn loss amid global market downturn

Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), experienced an US$11 billion loss in its investments in 2022.

The decline in global stock and bond prices negatively impacted the fund’s holdings, contrasting with its US$19 billion profit in 2021 when markets recovered from the pandemic.

Despite not disclosing the shareholder returns for 2022, the PIF’s net loss attributable to its owner was US$9.8 billion, compared to a profit of US$81.8 billion the previous year.

These figures shed light on the finances of one of the world’s largest state investors.

The PIF aims to accumulate US$2 trillion in assets by 2030 and has diversified its investments globally, including stakes in various industries and funding new cities.

The fund also made headlines with its merger promotion between the LIV professional golf league and the US PGA, part of Saudi Arabia’s efforts to enhance its international image through sports investments.

Other sovereign entities, such as Singapore’s Temasek Holdings and Norway’s sovereign wealth fund, also faced losses due to the global market downturn.

However, Saudi Arabia’s government recorded its first surplus in nearly a decade, benefiting from rising oil prices and production.

The PIF established a subsidiary to invest in sports and received a 4% transfer of Saudi Aramco shares worth approximately US$80 billion.

The fund’s transparency has increased since accessing international debt markets, differentiating it from many other regional sovereign wealth funds that disclose limited information about their investments and returns.

At the end of 2022, the PIF’s borrowings reached US$85 billion, and it raised US$5.5 billion through a green bond sale earlier this year.