Saudi Sovereign Wealth Fund Launches First Global Commercial Paper Program

Asharq Al-Awsat

7 days ago

The Public Investment Fund (PIF), Saudi Arabia's sovereign wealth fund, has launched its first-ever global commercial paper program, marking a significant step in strengthening its short-term financing capabilities and expanding its reach in international capital markets.
According to an official statement, the program allows for the issuance of commercial paper through Special Purpose Vehicles (SPVs). It consists of two sub-programs: one for the US market and another for the European market.
The program has already earned top credit ratings: Moody's assigned it a Prime-1 (P-1) rating, the highest short-term grade, while Fitch Ratings awarded an F1+ rating, also its highest for short-term instruments.
Fahad AlSaif, Head of Global Capital Finance and Head of Investment Strategy at PIF, said the launch aligns with the Fund's broader financing strategy. 'This program reflects our flexible and effective approach to funding, designed to support our long-term investment priorities,' he noted.
Commercial paper is widely used in global financial markets as a tool for short-term liquidity management. PIF's program is expected to enhance its agility in managing cash flow while complementing its long-term funding plans.
Mohammed Al-Farraj, Head of Asset Management at Arbah Capital, told Asharq Al-Awsat that the initiative highlights PIF's commitment to robust liquidity management and its ambition to lead both domestically and internationally. He called the move a 'strategic addition' to PIF's funding ecosystem, noting that the strong credit ratings will allow the Fund to secure financing at competitive rates, positioning it to capitalize on key investment opportunities without being overly exposed to short-term market volatility or interest rate risks.
Al-Farraj added that the launch supports PIF's strategy to diversify its funding sources and balance short-term needs with long-term goals. He pointed out that it will help drive major projects in critical sectors such as renewable energy, future industries, and advanced technology - key pillars of Saudi Arabia's Vision 2030.
He also emphasized the program's role in strengthening Saudi Arabia's standing as a global financial hub and increasing its appeal to international investors.
The initiative follows PIF's broader financing roadmap, which includes issuing green bonds - such as its landmark $3.5 billion sukuk offering - and reflects its continued pursuit of innovative, sustainable funding solutions to fuel the Kingdom's economic transformation.