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Thursday, Nov 20, 2025
Outside the box.
Saudi Crown Prince Promises Major U.S. Investment as Public Wealth Fund Faces Tightening Liquidity
Mohammed bin Salman declares a trillion-dollar U.S. investment ambition amid signs that the Public Investment Fund is under growing financial strain
Crown Prince Mohammed bin Salman used his visit to Washington this week to spotlight Saudi Arabia’s global economic ambitions, telling President Donald Trump that the kingdom intends to invest one trillion dollars in the United States.
The declaration reinforced the close alignment between the two leaders and highlighted Riyadh’s desire to expand its economic footprint at a pivotal moment in the bilateral relationship.
Behind the high-profile pledge, however, officials and analysts in Riyadh and global financial circles point to mounting pressure inside the Public Investment Fund, the sovereign vehicle responsible for driving much of the kingdom’s domestic transformation and its major foreign commitments.
After nearly a decade of aggressive spending on global acquisitions and large-scale domestic projects, the fund is contending with softer returns, impaired assets and a growing need to consolidate its investment portfolio.
Recent disclosures showed that the PIF’s annual profit fell sharply, hit by higher global interest rates, slower-than-expected payouts from energy-linked holdings and write-downs tied to giga-projects that form the backbone of Saudi Arabia’s Vision 2030 strategy.
The fund’s diminished liquidity has already prompted an internal restructuring effort aimed at stabilising performance and improving capital efficiency.
Market observers familiar with the fund’s operations say this recalibration reflects the financial reality confronting several mega-initiatives launched during the Crown Prince’s rapid push to diversify the economy.
The contrasting narratives—record-sized investment pledges abroad and tightening financial conditions at home—underscore the delicate balancing act for Saudi Arabia as it works to maintain its reform momentum while meeting high-profile global commitments.
For the Trump administration, the Crown Prince’s Washington visit offered renewed validation of the president’s assertive economic diplomacy, with Saudi Arabia continuing to present itself as a committed partner in U.S.-aligned investment and strategic cooperation.
Whether the kingdom can convert its trillion-dollar ambitions into sustained financial action will depend heavily on the PIF’s ability to navigate its current liquidity challenges and deliver returns from its vast portfolio of domestic and overseas projects.
For now, the pledge signals intent—while the fund’s restructuring reflects the scale of the task ahead.
The declaration reinforced the close alignment between the two leaders and highlighted Riyadh’s desire to expand its economic footprint at a pivotal moment in the bilateral relationship.
Behind the high-profile pledge, however, officials and analysts in Riyadh and global financial circles point to mounting pressure inside the Public Investment Fund, the sovereign vehicle responsible for driving much of the kingdom’s domestic transformation and its major foreign commitments.
After nearly a decade of aggressive spending on global acquisitions and large-scale domestic projects, the fund is contending with softer returns, impaired assets and a growing need to consolidate its investment portfolio.
Recent disclosures showed that the PIF’s annual profit fell sharply, hit by higher global interest rates, slower-than-expected payouts from energy-linked holdings and write-downs tied to giga-projects that form the backbone of Saudi Arabia’s Vision 2030 strategy.
The fund’s diminished liquidity has already prompted an internal restructuring effort aimed at stabilising performance and improving capital efficiency.
Market observers familiar with the fund’s operations say this recalibration reflects the financial reality confronting several mega-initiatives launched during the Crown Prince’s rapid push to diversify the economy.
The contrasting narratives—record-sized investment pledges abroad and tightening financial conditions at home—underscore the delicate balancing act for Saudi Arabia as it works to maintain its reform momentum while meeting high-profile global commitments.
For the Trump administration, the Crown Prince’s Washington visit offered renewed validation of the president’s assertive economic diplomacy, with Saudi Arabia continuing to present itself as a committed partner in U.S.-aligned investment and strategic cooperation.
Whether the kingdom can convert its trillion-dollar ambitions into sustained financial action will depend heavily on the PIF’s ability to navigate its current liquidity challenges and deliver returns from its vast portfolio of domestic and overseas projects.
For now, the pledge signals intent—while the fund’s restructuring reflects the scale of the task ahead.
