Saudi sovereign fund to develop holy sites in Mecca, Medina

Source: Reuters

By Stephen Kalin

RIYADH (Reuters) – Saudi Arabia’s Public Investment Fund (PIF) is forming two real estate development firms to boost the capacity of Mecca and Medina to receive pilgrims, in projects expected to create billions of dollars of business, it said on Monday.

The plans are part of an array of commitments which the PIF, the country’s main sovereign wealth fund, is taking on under economic reforms designed to reduce Saudi Arabia’s dependence on oil exports.

The government is mobilising the fund, believed to have about $180 billion of assets, to lead urban development and industrial projects around the country, even as the PIF manages stakes in top Saudi companies and makes foreign investments such as last year’s purchase of a $3.5 billion stake in Uber.

The scope of the PIF’s activities has caused concern among some private Saudi businessmen. The reforms aim to stimulate the private sector but with so many huge projects going to the PIF, some businessmen fear they could be crowded out by the deep-pocketed fund.

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