RIYADH | SAUDI ARABIA – Saudi Arabia transferred a total of 150 billion riyals ($40 billion) from central bank foreign reserves to fund investments by sovereign wealth fund PIF in March and April, the finance minister said on Friday.
Saudi Arabia’s central bank foreign reserves fell in March by nearly $27 billion month-on-month, their fastest rate in at least 20 years, to around #464.5 billion, according to Reuters calculation based on central bank data. April figures are not yet available.
Finance Minister Mohammed al-Jadaan said in a statement that the transfers to PIF were done on an ‘exceptional basis’ but did not give a break down for each month.
‘While foreign exchange flows since the start of the year on average within historical levels, this measure (transfers to PIF) resulted in a reduction in net foreign reserves assets to support investment plans’, he said, adding the PIF investments would not be reflected in published central bank data.
‘Maximizing returns on the kingdom’s assets will reflect positively on economic performance and public finances and limit negative effects on the coronavirus pandemic. Returns on PIF investments will be available to support public finances when needed’, he said.
The kingdom, the world’s largest oil exporter, slipped into a $9 billion budget deficit in the first quarter as a oil revenues collapsed.
Jadaan also said in the statement that the government would continue to implement development plans to diversify the economy, increase local content and support private sector.