- Nation said to be seeking proposals from banks, consultants
- Report says Saudi Arabia focusing on businesses outside energy
Saudi Arabia plans to set up a sovereign wealth fund to manage part of its oil fortune and diversify its investments, according to Reuters.
The nation is seeking proposals from investment banks and consultants, the news service reported, citing unidentified people familiar with the matter. The sovereign wealth fund is said to be focusing on businesses outside the energy industry and may be active within one to two years with an office in New York, Reuters reported.
The Saudi Arabian Monetary Agency, which is the nation’s central bank and manages the kingdom’s currency reserves, couldn’t be reached for comment.
Saudi Arabia is trying to manage declining oil prices and rising tensions among countries in the Middle East including Iran. Saudi Arabia’s net foreign assets dropped to $640 billion in October, the lowest level in three years, as the oil rout strains government finances in the biggest Arab economy. The oil slump has spurred the country to search for savings, contemplate project delays and sell bonds for the first time since 2007.
Crude oil has slumped almost 70 percent in the past two years, prompting countries from Norway to Saudi Arabia to tap wealth funds accumulated during the boom years to bolster their budgets. Wealth funds that relied on commodities are shifting strategies and diversifying their holdings.
Saudi Arabia’s Public Investment Fund is seeking to hire bankers for international deals to help the kingdom acquire overseas technology and expertise, people with knowledge of the matter said in October. The hires will help the fund make strategic acquisitions in industries including transport, manufacturing and technology, the people said.