For much of the past decade, Saudi Arabia has been a major draw for dealmakers, bankers and asset managers seeking capital as its ambitious sovereign wealth fund went on a multibillion-dollar global spending spree. But as the kingdom reassesses its priorities and the $925bn Public Investment Fund shifts focus to huge domestic commitments, the era of Saudi Arabia being perceived as a source of easy money is drawing to a close.
... The frenzy of activity coincided with tightening liquidity in other parts of the world, marking out Saudi Arabia and other oil-rich Gulf states as go-to sources for funding. That sentiment grew after Russia's invasion of Ukraine sent energy prices to multiyear highs, creating a boom in the Gulf and helping Saudi Arabia post a budget surplus in 2022 — its first in almost a decade. But since then, the kingdom has slashed oil production in a bid to stabilise softening crude prices. That has hit government revenues and returned the budget to a deficit with Riyadh facing massive financial commitments to fund development plans. Deals have also fallen through, bankers say. "For the last eight years, Saudi Arabia has gone out to the rest of the world with an open hand of money. Now the fist is clenching and pulling back to the country," said a London-based investment banker. "It's part of the maturing strategy. They could not have gone on like this forever."