Saudi Arabia, in a strategic partnership with the world’s largest asset manager BlackRock, has established a national infrastructure fund to support up to $53 billion worth of projects in vital sectors over the next 10 years.
The National Infrastructure Fund (NIF) will invest in areas like water, transportation, energy and health, contributing to Saudi Arabia’s plans to transform the economy and make it less reliant on oil revenue.
The national infrastructure fund will enable private sector investments in infrastructure projects by providing “innovative” financing solutions. The move will also boost the national gross domestic product and create job opportunities in the country.
Further, the NIF aims to contribute to the development of the financial sector by finding alternative solutions to finance infrastructure projects and encouraging the private sector to invest in these projects. The fund will have a complementary role with the National Centre for Privatisation.
The NIF is part of the National Development Fund, a government entity established in 2017 with the aim of overseeing and linking together several economic development funds previously spread between various ministries and agencies.
The NDF appointed BlackRock as a strategic partner in establishing the infrastructure fund to apply the best international practices in the management and governance of specialized financial institutions and funds. BlackRock opened its office in Saudi Arabia in 2019 to capitalize on the government’s reform agenda.
The Public Investment Fund (PIF) and NDF are at the center of Crown Prince Mohammed bin Salman’s plans to diversify the Saudi economy and create jobs, with NDF tasked to mobilize private sector financing to support economic development.