Riyadh: Saudi Arabia’s sovereign wealth fund has mandated banks for a debut dollar green bond sale, according to people with knowledge of the matter.
The PIF, as the fund is known, is selling its debut green bond as Saudi Arabia - one of the world’s largest oil exporters - is looking to increase the role that environmental, social and governance principles play in its investments. The fund is also working with BlackRock on developing an ESG framework.
The fund has been investing more into businesses that benefit from a transition away from fossil fuels, mirroring the kingdom’s wider strategy to diversify its economy away from a reliance on crude sales. It has boosted its stake in ACWA Power International, a Saudi producer that is spending heavily on renewable energy from solar to hydrogen, and also invested in electric vehicle manufacturer Lucid.
Fitch Ratings has given the fund a rating of A, the sixth-highest investment-grade level, with a stable outlook - also the same grade it assigns for Saudi Arabia’s government.