SovereigNET - Fletcher Network for Sovereign Wealth and Global Capital

In The News: Sovereign Wealth Funds

Fall 2012

Kuwait Investment Authority (KIA) was recently granted a CNY 6.5 billion (USD 1 billion) license by China's central bank to invest in the domestic interbank bond market. The People's Bank of China launched a program in August 2010 to allow selected foreign financial institutions and central banks to buy bonds on China's interbank market under a preset quota, in a move aimed at promoting the internationalization of Chinese currency. Read more

Government of Singapore Investment Corp. plans to maintain a long-term investment strategy even as the global debt crisis drives volatility higher. GIC, which manages more than $100 billion of the city- state’s reserves, said in July it almost quadrupled its cash allocation as it pared bonds and stocks, and European holdings amid the region’s debt crisis. The fund has said its objective is to beat global inflation over a 20-year investment horizon. Read more

China Investment Corporation (CIC) is in talks to invest in a fund launched by New Zealand's Fonterra, the world's largest dairy processor. CIC, China's sovereign wealth fund, is considering an initial investment of less than $100 million. Fonterra, a co-operative owned by about 10,500 farmers, launched the NZ$525 million ($430 million) fund last month, hoping to lure investors with an expected yield of up to 7 percent. Read more

With around $20 billion in cash to put to work, the Libyan Investment Authority is scouting for new bond and property investments despite global economic uncertainty and as it looks to diversify away from the financial sector. LIA chairman Mohsen Derregia said it plans to radically change the asset allocation of its $60 billion portfolio after several years of lackluster returns and allegations of misconduct leveled against its former managers. Read more

A group of investors led by Jan Kulczyk, Poland’s richest man, and Qatar’s sovereign wealth fund are bankrolling a $700m company investing in mineral exploration and extraction in Africa and South America. Mr Kulczyk and Qatar Holding are expected to each invest $250m, with $100m coming from each of BTG Pactual, a Brazilian investment bank. Read more

The NZ$20 billion New Zealand Superannuation Fund's program of making investments outside of its strategic asset allocation framework when markets diverge sharply from underlying fundamentals has added value since its February 2009 launch. Sovereign wealth funds emerged from the market turmoil of 2008 convinced of the need to become more agile than “set-it-and-forget-it” asset allocation targets allow. Read more

China's sovereign wealth fund will focus more of its $482 billion firepower on Asia in twin bids to beat a rise in protectionism in the West and boost exposure to rapid regional growth, chairman and chief executive Lou Jiwei said. The man charged with stewardship of a slice of the world's largest store of foreign wealth lauded the British approach to overseas investment in public sector projects as one for the world to follow. Read more

Nigeria moved closer to joining most of its OPEC partners in steering oil revenues into longer-term investment, announcing a top management team for its new sovereign wealth fund. Finance Minister Ngozi Okonjo-Iweala said the fund would start with a cash hoard of around $1 billion. The top team will come from First Bank and UBS. Read more

Poland launched a plan aimed at reinvigorating its slowing economy while sidestepping the sort of unpopular austerity measures that have toppled governments in several of its fellow European Union states. Prime Minister Donald Tusk said he wants to pump hundreds of billions of dollars worth of investment into the country's energy sector and infrastructure through 2020 by leveraging valuable state-owned assets to raise the cash. Read more

Read Summer 2012 news here.

Read March/April 2012 news here.

Read February/March 2012 news here.

Read January/February 2012 news here.

Read November/December 2011 news here.

Read October/November 2011 news here.