LONDON: Saudi Arabia’s Public Investment Fund (PIF) is targeting annual returns of between 3 and 9 percent across its portfolios in the long term, its managing director said on Tuesday.
Yasir Al-Rumayyan was speaking at the opening session of a major conference hosted by the PIF in Riyadh.
Panelists included BlackRock Chairman Larry Fink, IMF Managing Director Christine Lagarde and Victor Chu, CEO of First Eastern Investment Group.
They were quizzed on their outlook for investment returns as individuals and states worldwide grapple with how to ensure sufficient retirement fund during an extended period of low growth across global economies.
Al-Rumayyan said that some assets could reach annual returns in the low teens.
“We don’t want to be a sitting duck to be shot down by only being in conventional investments. We want to go beyond – that is what Vision 2030 is all about.”
He also revealed that he wants the Future Investment Initiative to become an annual event which would help the Kingdom prepare for the future.
BlackRock’s Fink warned: “Long term growth rates are decelerating quite rapidly and this is going to present pension funds with bigger liability issues – but this is also one of the reasons we have to address this issue of retirement today with expected returns — whether it’s 4, 6 or 8 (percent).
“It means you have to put money away sooner to get to the expected pool of money you want in retirement.”
Asked about his own forecasts for what was possible and realistic as an investment return, he said: “The BlackRock Investor Institute came out with a 10-year forecast of 4 percent – with a balanced portfolio. I tend to think it will be closer to 6 percent. We’re in a world of low inflation.”
Dozens of the biggest names in global business have arrived in the Kingdom for the Future Investment Initiative (FII), which is being hosted by the Public Investment Fund (PIF) — the body that is spearheading a slew of economic reforms.
Saudi Arabia is undergoing unprecedented economic and social reforms as the Kingdom seeks to reduce reliance on oil and gas revenues while creating thousands of new jobs for a youthful population.
PIF and BlackRock chiefs reveal investment targets in Riyadh
PIF and BlackRock chiefs reveal investment targets in Riyadh
Economic growth and resilience at heart of 2nd AlUla Emerging Market Economies Conference
- Event on Feb. 8 and 9 will bring together ministers, governors of central banks, policymakers, economic experts and international financial institutions
- Emerging-market economies a ‘pivotal element’ in global economic system due to effect they have on growth and stability, says Saudi Finance Minister Mohammed Al-Jadaan
RIYADH: The second annual AlUla Conference for Emerging Market Economies, which Saudi Arabia will host next week, offers a platform to exchange views on global developments and discuss policies and reforms that support inclusive growth and strengthen economic resilience, the Kingdom’s finance minister said.
The event on Feb. 8 and 9 will bring together finance ministers, governors of central banks and policymakers, alongside economic experts and representatives of international financial institutions.
Organized by the Saudi Ministry of Finance in partnership with the International Monetary Fund, it takes place as emerging-market economies face mounting challenges amid rapid global economic change.
Finance Minister Mohammed Al-Jadaan said the decision to host the conference reflects Saudi Arabia’s ongoing commitment to efforts that support global financial and economic stability, and highlights the growing influence of emerging economies on worldwide growth.
Emerging-market economies represent a “pivotal element” in the global economic system due to the direct impact they have on economic growth and stability, he added.
“The AlUla Conference for Emerging Market Economies provides a unique platform for exchanging views on global economic developments, and discussing policies and reforms that will support inclusive growth and enhance economic resilience, in light of broader international cooperation that contributes to confronting common challenges,” Al-Jadaan said.
Kristalina Georgieva, managing director of the IMF, said the event would help emerging economies deal with growing uncertainty driven by technological change, demographic shifts and geopolitical tensions.
“The AlUla conference provides a vital platform for emerging economies to discuss how they can navigate the risks and embrace the opportunities ahead,” she said.
“In these times of sweeping transformations in the global economy, policymakers face a more challenging and uncertain environment. Countries should work together to strengthen resilience through sound macroeconomic and financial policies.”
