Global sovereign wealth funds projected to double to $30 trillion by 2035

Middle Eastern sovereign wealth funds (SWFs) are entering a critical phase in which strategic adaptation will be essential to sustaining growth over the coming decade, according to a new report by Bain & Company.

The consultancy found that the Middle East accounts for around 40% of assets managed by the world’s 10 largest sovereign wealth funds, which collectively hold more than 75% of global SWF assets.

While strong investment performance and government capital injections have supported growth in recent years, funds are expected to face a more complex operating environment marked by higher interest rates, geopolitical fragmentation, technological disruption, volatile hydrocarbon revenues and the global energy transition.

According to Bain, sovereign wealth funds have been the fastest-growing institutional investor class globally over the past decade. Assets under management reached approximately $15 trillion in 2025, representing a compound annual growth rate of 10.3% between 2020 and 2025, and are projected to nearly double to $30 trillion by 2035.

For Middle Eastern funds, continued expansion aligns with national efforts to diversify economies and reduce reliance on oil revenues through investment in new industries and long-term growth sectors.

“The next generation of leading sovereign wealth funds will be defined by their ability to deploy capital strategically, create value operationally, and deliver their dual mandate in a targeted and sustainable way while delivering world-class returns,” said Gregory Garnier, Partner at Bain & Company and Head of the firm’s Private Equity and Sovereign Wealth Fund practice in the Middle East.

The report found that sovereign wealth funds are adjusting investment strategies by increasing allocations to alternative assets, which now account for roughly 30% of assets under management at major funds, up from 20% in 2015.

Funds are also expanding direct and co-investment activity, which Bain estimates now accounts for 50% to 60% of private-market investments. At the same time, sovereign investors are increasing their exposure to Asian markets and exploring alternative funding sources, including debt issuance and capital recycling.

Many funds are also balancing financial returns with broader economic development goals, using capital to support industrial growth, economic diversification and national competitiveness.

Bain cited the example of Saudi Arabia’s Public Investment Fund leading a consortium to acquire Electronic Arts in a $55 billion take-private transaction expected to close in the first quarter of 2027.

Artificial intelligence has emerged as both a key investment theme and an operational priority. According to the report, sovereign wealth funds have committed more than $350 billion globally to AI-related investments spanning semiconductors, data centers, digital infrastructure, and software applications.