(MENAFN) Saudi Arabia's Finance said that the kingdom does not see the need to create a sovereign wealth fund to manage its oil wealth, adding that its surplus is well invested through the Saudi Arabian Monetary Agency (Sama), its central bank, which had net foreign assets worth USD733 billion by October, The Peninsula Qatar reported.
Saudi's refusal to create a fund comes despite the calls of different businessmen for the kingdom to create a sovereign wealth fund that will generate more money compared to the world's top oil exporter investments, which are believed to be made in low-risk US dollar assets such as US Treasury bonds and bank accounts, which tend to earn low returns compared to the more aggressive, higher-risk investments favored by some other rich oil exporters.
The Saudi businessmen arguing for the establishment of such said that the annual earnings of the fund would cover a large part of the budget deficits the kingdom is expected to register due to the continuous decline in oil prices.
"I believe the kingdom's policy is the most suitable for its circumstances. Saudi Arabia had ridden out the global financial crisis in 2008 with relatively little damage. Sama's international reserves are managed professionally by Saudis as well as by international fund managers and the return from investing the reserves are similar to and in some years higher than the returns of Norway's sovereign fund," Saudi's Minister of Finance said.
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