Saudi Arabia wealth fund secures $17bn loan for megaproject push

Saudi Arabia wealth fund secures $17bn loan for megaproject push

Saudi Arabia’s sovereign wealth fund has secured a $17bn loan to help finance its push into the megaprojects that it hopes will diversify the kingdom’s economy from oil revenues.

The seven-year senior unsecured loan was provided by a syndicate of 25 financial institutions in Europe, the US, the Middle East and Asia, the Public Investment Fund said on Wednesday. An earlier $11bn loan for five years that was arranged in 2018 will be paid off early, it said.

The $600bn fund, chaired by the country’s day-to-day ruler Crown Prince Mohammed bin Salman, is in charge of kick-starting an ambitious reform policy that will reduce its reliance on sales of crude oil. Unlike most other wealth funds, PIF has a dual mandate to help develop the nation, as well as pursue financial returns.“The new loan forms part of PIF’s medium-term capital raising strategy andits 2022 Annual Capital Raising Plan — the plan includes several fundingtools that would ensure PIF continuous and sustainable access to diversefunding sources, including public and private,” the fund said in its statement.

PIF is not believed to need the capital imminently. But analysts have questioned how the fund will finance all its schemes, which include commitments to invest $40bn annually