Saudi licensed endowment investment funds have recorded a new peak in net assets at SR1 billion, or $266.67 million, as of 2024, which was a 29.3% rise from last year. The growth came after a staggering leap in 2023, when assets hit half a billion riyals for the first time.
The expansion is accounted for in the addition of five newly licensed endowment entities. This brings the total of funds to 34, comprising 27 public and 7 private funds. These endowment funds are very significant for supporting long-term projects that may benefit public welfare, such as education, health, and infrastructure, since they are significant for the advancement of social and economic development of the Kingdom.
Operating on the principal model, Saudi endowment funds maintain the capital but spend the returns on charitable and developmental activities. This sustainable funding mechanism is intended to ensure a consistent flow of funding support for fundamental sectors, in consonance with Saudi Arabia’s overall economic and social objectives. The General Authority for Endowments made the establishment of the funds easier by streamlining licensing and management procedures, thus enhancing transparency and promoting the efficiency of investments from endowments. The funds are also managed and overseen by the Capital Market Authority (CMA), ensuring them to comply with strategic economic objectives of the Kingdom.
Shariah compliant, these trusts are in line with Saudi Arabia’s cultural and religious beliefs. This makes it easy to achieve the needs of Vision 2030, which aims to diversify the economy from oil dependency and focus on growth in other key sectors.
Endowment investments drive the development of human capital through improvements in education and healthcare infrastructure and promoting an increase in the extension of core infrastructure to sustain the overall urbanization of cities such as Riyadh and Jeddah. Saudi Arabia’s endowments, focused on preserving capital and solid management of investments, significantly contribute to shaping a prosperous and sustainable future for the Kingdom.
