– The Public Investment Fund (PIF) of the Ministry of Finance serves as the government’s investment arm and holds stakes in publicly traded companies, and is the main driver of economic development in the Kingdom through two primary objectives set by the Council of Ministers in 1391 AH and 1394 AH. The first is to finance investment in commercial production projects wholly or partially owned by the state, and the second is to own and manage the government’s stake in industrial, agricultural, commercial, and service joint-stock companies established by the private or public sector through equity participation, Its mechanisms for intervening in project financing in these sectors range from lending to equity participation to guarantees to joint financing with the private sector.
The Fund’s Objectives
The Fund aims to provide financing for certain commercial production projects, given their significant importance to the development of the Saudi economy, and to provide the essential resources for their implementation—resources that the private sector cannot provide on its own, either due to a lack of experience or capital.
The Fund has a number of economic objectives and missions; it specializes in financing investment in commercial production projects, whether wholly or partially government-owned.A number of key economic sectors in the Kingdom have received funding from the Public Investment Fund, such as the construction of oil refineries—whether for domestic consumption or export—as well as pipelines and storage facilities,the transportation sector—including air transport and the financing of aircraft fleets for passenger and cargo transport—as well as maritime transport, rail transport, basic and downstream petrochemical industries, and strategic projects owned by the private sector,the energy sector and seawater desalination; the mining sector and its related infrastructure, such as the construction of railways connecting raw material deposits to manufacturing and export areas; and the information technology sector;The Fund also contributes to the capital of a number of national companies in implementation of Cabinet Decision No. 508 dated 2/4/1394 AH, in addition to contributing to a number of Arab, bilateral, and international companies.
Fund Contributions:
Loans:
The total loans disbursed by the Public Investment Fund through the end of the fiscal year 1431/1432 AH amounted to (120,244) million riyals, covering the following projects:
• Domestic refineries.
• Refineries and lubricant manufacturing plants.
• Storage terminals for petroleum products.
• Pipelines for the distribution of crude oil and petroleum products.
• Export refineries.
• Iron and steel mills.
• Metal plants
• Fertilizer plants.
• Petrochemical plants.
• Purchase of aircraft for Saudi Arabian Airlines.
• Projects in the Holy Cities.
• Electricity and water projects.
• Railroad projects.
Major Investments:
The Fund holds stakes in a number of national companies across various sectors. At the end of the fiscal year 1431/1432 AH, the number of these companies stood at 41 companies, with a total value of (63,249) million riyals. These sectors included the following:
• The cement sector.
• The electricity sector.
• The water sector.
• The maritime and land transportation sector.
• Cooperative insurance sector.
• Agriculture and fisheries sector.
• Gas and petrochemicals sector.
• Real estate and hotels sector.
• Health services sector.
• The education sector.
The Fund’s ownership stakes in these companies range from 100% for companies not listed on the local stock market to 5% to 70% for companies listed on the stock market. The website (Tadawul) website shows the Fund’s ownership percentage for each of the companies it owns that are listed on the market.
The Fund holds stakes on behalf of the Kingdom in several Arab joint ventures. As of the end of the fiscal year 1431/1432 AH, the number of companies in which the Fund held stakes reached 27 Arab joint ventures engaged in various activities. The total value of the Fund’s investments in these companies amounted to 14,867 million riyals.
Railway Projects in the Kingdom
In accordance with the directives of the Custodian of the Two Holy Mosques to establish high-speed rail lines equipped with modern signaling and communications systems to provide comfortable transportation services using the latest technologies, the Fund provided financing for the implementation and operation of the railway project connecting the northern part of the Kingdom with its central region andeast, for the transport of minerals, cargo, and passengers. The line connects the northern region from Al-Haditha and Hazm Al-Jalamid to Ras Al-Khair on the coast of the Arabian Gulf, and from Al-Haditha to Riyadh, passing through Al-Jawf, Ha’il, and Al-Qassim. The value of contracts signed to date for the implementation of this project has reached (14.5) billion riyals.
Furthermore, directives were issued for the Fund to finance the Haramain High-Speed Rail Project, which connects Madinah, Jeddah, and Makkah,Contracts have been signed for the civil works, passenger stations, and the second and final phase of this project, with a total value of (47.2) billion riyals.
The Fund’s Most Notable Projects
The Fund has contributed to the financing and support of a number of prominent government and quasi-government projects, most notably:
• Saudi refineries.
• Refineries and lubricant manufacturing plants.
• Storage terminals for petroleum products.
• Pipelines for the distribution of crude oil and petroleum products.
• Export refineries.
• Iron and steel mills.
• Fertilizer plants.
• Petrochemical plants.
• Aircraft purchases by Saudi Arabian Airlines.
• Holy Sites projects.
• Al-Alam Company.
• Thiqah Business Services Company.
• Saudi Railway Company (SAR).
