UPDATE 1-Saudi Arabia Launches National Infrastructure Fund with BlackRock

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DUBAI, October 25 (Reuters) – Saudi Arabia, advised by the world’s largest fund manager BlackRock, has launched a national infrastructure fund to support up to 200 billion riyals ($ 53 billion) in projects over the next decade, the official SPA news agency announced. On Monday.

The National Infrastructure Fund (NIF) will invest in areas such as water, transport, energy and health, thus contributing to Saudi Arabia’s plans to transform the economy and make it less dependent on income oil tankers.

The fund is one of the development funds of the National Development Fund (NDF), an organization created in 2017 with the aim of supervising and federating several economic development funds previously divided between different ministries and agencies.

The NDF hired BlackRock to advise it on the creation of the fund, “to implement international best practices in the management and governance of specialized financial institutions and funds,” SPA said, citing Stephen Paul Groff, NDF governor. .

“The fund also aims to contribute to the development of the financial sector by finding alternative solutions to finance infrastructure projects and to encourage the private sector to invest in these projects,” SPA said.

The Public Investment Fund and the NDF are central to Crown Prince Mohammed bin Salman’s plans to diversify the Saudi economy and create jobs, with the NDF tasked with leveraging private sector finance to support economic development.

BlackRock opened an office in Saudi Arabia in 2019 to capitalize on the government’s reform agenda.

The infrastructure fund will use structured finance products, including debt, equity and guarantees, “to reduce the risk of infrastructure investment opportunities for local and global investors,” said Abdullah Abobakr, director of the NIF project.

“The NIF will thus play a key role in expanding infrastructure investment opportunities and deepening infrastructure capital markets in the kingdom,” he said. (Reporting by Davide Barbuscia; Editing by Kirsten Donovan and David Holmes)

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