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UPDATE 1-Saudi Arabia's PIF aims to manage over $400 bln in assets by 2020

(Adds details, background)

RIYADH, Oct 25 (Reuters) - Saudi Arabia's Public Investment Fund (PIF) aims to increase its assets under management to 1.5 trillion riyals ($400 billion) by 2020 as part of the country's Vision 2030, an economic reform plan aimed at boosting private-sector growth and developing non-oil industries.

The country's main sovereign wealth fund, which is expected to receive proceeds from the planned sale of 5 percent of state oil company Saudi Aramco's <IPO-ARMO.SE> shares, has currently around $230 billion worth of assets under management.

PIF plans to create 20,000 direct domestic jobs, and 256,000 construction jobs by 2020. This will increase PIF's contribution to Saudi Arabia's gross domestic product from 4.4 percent to 6.3 percent, it said in a statement on Wednesday, during a huge investment conference in Riyadh arranged by the fund.

Investments will be in sectors such as real estate and infrastructure as well as in new areas of activity in the Saudi economy through the establisment of companies such as the Saudi Arabian Military Industries company and the Saudi Real Estate Refinancing Company.

One of the biggest tasks under PIF's responsibility is the delivery of a $500 billion plan to build a business and industrial zone extending into Jordan and Egypt.

PIF will also seek to maximise value in the fund's existing assets, and has set a new target to increase total shareholder return to 4-5 percent from 3 percent, it said on Wednesday.

The PIF Program represents a vital milestone as we work towards realising Vision 2030," Prince Mohammad bin Salman Al-Saud, the plan's architect, said in a statement.

Outside of Saudi Arabia, PIF's investments will be in a number of assets such as fixed-income, public equity, private equity and debt, real estate, infrastructure and alternative investments such as hedge funds, the fund said. ($1 = 3.7498 riyals) (Reporting by Katie Paul; Writing by Davide Barbuscia; Editing by Jason Neely, Greg Mahlich)