The Public Investment Fund and Salman’s state: the political drivers of sovereign wealth management in Saudi Arabia

ABSTRACT

Saudi Arabia's Public Investment Fund (PIF) has grown from marginal player to the most important economic actor in the Kingdom since 2015. Nevertheless, we know surprisingly little about the political economy of the PIF revamp. Against an unfavorable macroeconomic backdrop, I argue that shifts in PIF organization and orientation are fundamentally driven by the centralization of power within the circles of the Saudi ruling family since the rise of Mohammed bin Salman (MBS). The fund's governance framework and network of insiders forming the board of directors mirror the concentration of authority around MBS. In turn, PIF domestic activities shifted from scattered investment patterns associated with the competing influence of senior decision-makers to a highly authoritative and personalized strategy. Moreover, the PIF's response to COVID-19 further exemplifies the turn from a conservative strategy toward a short-term oriented approach to sovereign wealth management. Going beyond macro-level economic and institutional dynamics, the article introduces the role of political agency in SWF choices by stressing how political actors and the distribution of power within ruling elites shape SWFs. The article thus adds to the scholarship on domestic drivers of SWFs and contributes to debates surrounding the interplay between states and markets under processes of financialization. [ FROM AUTHOR] Copyright of Review of International Political Economy is the property of Routledge and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full . (Copyright applies to all s.)