According to an annual report quoted by CNBC, the Saudi Arabian State Investment Fund (PIF) reported an impairment of $8 billion by the end of 2024 after the cost of investments in so-called "gigaprojects" decreased. This is reported by Profit.Ro .
Although assets under management grew by 19% over the year, reaching about $ 913 billion, investments in megaprojects decreased by 12.4%, to $56.2 billion, which is only 6% of the portfolio compared to 8% previously.
The downward revision of the cost of these projects is taking place against the backdrop of falling oil prices and an increase in the budget deficit of the kingdom, whose economy is still heavily dependent on oil revenues, despite plans to diversify. Huge costs and delays, estimated at 0.5−1.5 trillion dollars, forced the authorities to reduce or postpone some developments.
At the same time, the annual return of PIF decreased from 8.7% to 7.2%, and the share of international investments in the portfolio decreased to 17% of the total, the fund focused more on the domestic market. Experts warn that the continued decline in oil prices may limit dividends and, indirectly, project financing opportunities, increasingly directing it to fast-growing sectors such as artificial intelligence.
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