The Public Investment Fund (PIF), the Saudi Arabian sovereign wealth fund, will cut its international investments to focus more on domestic projects, according to its governor Yasir Al-Rumayyan.
The PIF’s current overseas investments, including sports investments into properties such as the Newcastle United soccer team, make up about 30% of its reported $900 million portfolio, with Al-Rumayyan stating his intention to reduce that figure down to 18%-20%.
The PIF’s stated aim is to reduce Saudi Arabia’s dependence on oil revenue by expanding revenue in other business sectors such as sport.
This has come through investments in soccer (Al-Rumayyan is Newcastle's chair), golf (through its LIV Golf tour), and combat sports under the Riyadh Season sports and entertainment festival brand.
Earlier this month, Bob Arum, the chief executive of boxing promotion Top Rank (which is partnered with Riyadh Season), explained that the Riyadh Season brand will no longer be holding boxing cards outside of Saudi Arabia.
This is ostensibly due to the lack of success that the brand’s last Los Angeles event (Bivol vs Beterbiev) saw, as well as pushback against chief Turki Alalshikh from internal higher-ups in Saudi Arabia for staging events outside the country.
With more high-profile events to take place within Saudi Arabia, it maintains that the country and its enterprises, which include the PIF, are set to focus investment back internally, both on sports events and major infrastructure projects such as the NEOM city.
These infrastructure projects, known internally as “giga-projects”, have recently been scaled back in ambition due to their massive cost, which may potentially be another reason why the fund is looking to channel more investment domestically as opposed to having it leave the country.
What this will also mean is that the purse strings at Newcastle, LIV Golf, and other prominent yet costly international sports venture owned by the PIF, may be tightened.
It also means that a number of reports surrounding investment aims at the PIF, such as its reported $2 billion offer to merge tennis’ ATP and WTA tours or its supposed interest in rugby union, may not come to pass after all.
Accusations of sportwashing have in the past been levied against the PIF, which has been accused of being a vehicle to launder the reputation of the Saudi regime through sport.
These accusations have never swayed the PIF from its goals, but may now lessen should the PIF's influence in international sport wane.
