The international political economy of Saudi Arabia: Sovereign fund and foreign policy

This article develops a framework for attributing motivations to Sovereign Wealth Fund (SWF) investment by noting that there are two major subdivisions, those that argue that the investments are undertaken due to macroeconomic factors and those that argue there is a political element as well. The political literature is divided into three subcategories of domestic political considerations, geopolitical competition and economic diplomacy. The literature of the Public Investment Fund (PIF) does not include any discussion of economic diplomacy as a consideration, an omission this article seeks to rectify. Using a realist understanding of international political economy (IPE), the article explores the influence of elites, the nature of PIF investments in America, India, China and Russia, and collaboration with other SWFs on investment. The article concludes that economic diplomacy should be considered as one of a multitude of variables that determine how and where the PIF invests.