Reuters says the Public Investment Fund will “reorganize management”

The sovereign wealth fund is mulling a “reorganization” of management, will review its contracts with global consultancies McKinsey and BCG, and could prioritize plans with short-term impact, Reuters reports in an exclusive. Part of the reorganization could see Public Investment Fund Governor Yasir Al-Rumayyan delegate some responsibilities to managers at the PIF, the newswrite adds.

A shift of focus, not a change of plan: The fund will reportedly prioritize projects that have a higher chance of success, the newswire’s unnamed sources said. There’s no publicly available information about which projects are expected to be paced out. The newswire joins Bloomberg which has reported earlier that progress as the glass-walled city — better known as The Line — would be scaled back. Neom officials have recently assured contractors and bankers that the buildout of the city was proceeding on schedule.

Rationalizing costs + attracting foreign investments: The USD 925 bn fund is looking to drum up foreign investment while rationalizing spending on expensive consultancy contracts, Reuters adds. This is in line with the Finance Ministry’s plan to pace out growth in some of the country’s mega projects not to “overheat” the economy as Finance Minister Mohamed Al Jadaan put it earlier this month. Al Jadaan first alluded to this view on allowing the economy to catch up with the government’s projects in December, when he hinted that the government could strategically slow down the execution of some of its economic transformation projects, meaning some could wrap past their initial 2030 deadlines.

Remember: Neom also recently came off the road in China with officials looking to rally interest from Hong Kong, Beijing, and Shanghai. It is looking to diversify its funding sources away from PIF, securing a fresh revolving credit facility worth SAR 10 bn from local banks and reportedly planning what could be its first-ever sukuk sale.

MEANWHILE- Design and engineering firms can now bid for works in the next phase of the Mukaab project of the PIF-owned New Murabaa Development, Saudi Gazette reports. Some 5 mn cubic meters of excavation work is complete and the final design is expected to be ready in 3Q 2024.