A general view shows the Saudi capital Riyadh, late 03 October 2007. AFP PHOTO/HASSAN AMMAR
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Saudi Arabia aims to create the world's biggest sovereign wealth fund, a $2 trillion behemoth that can throw its weight around global markets, but the fund's growth abroad is likely to be slowed by its responsibility for aiding the economy at home.The PIF, founded in 1971 to finance development projects in Saudi Arabia and until now little known abroad, is to grow from 600 billion riyals ($160 billion) to over 7 trillion riyals, helping make Riyadh a global "investment power," he said. The result, say bankers and consultants familiar with Saudi official thinking, is that in the initial years at least, the PIF's resources and management attention are likely to focus more on domestic projects than foreign markets.That simply makes the PIF a large holding company rather than a fund that can funnel large sums into new investments.In any case, the PIF looks set to have much less than $2 trillion to play with in global markets for the foreseeable future, limiting its contribution to Saudi state finances.
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