August 17th, 2008
Sovereign wealth funds (SWFs) are not new, by any means, but their degree of asset accumulation and willingness to deploy it overseas, is unprecedented. And this is appreciated, by global investment and commercial banks, especially those in the U.S. SWFs are increasingly important players in equity markets and are not only providing some support on the “buy” side, but also are poised to serve as stable shareholders. A great example of this is in Japan, where SWFs have been signaling significant increases to their allocations. Earlier this month, Kuwait (KIA) announced plans to triple its investment in Japan to $48B. On the flip side, it goes without saying that there are tremendous positive implications for SWF domestic-oriented investment. And on that note, take a look at SWF assets (top-5) and corresponding wealth per capita (clip thumbnail image to enlarge).
Chart Sources: The Economist, Govt. of Norway Pension Fund, Reuters and PRC Embassy in U.S.
Posted in SWF
[...] In a recent blog post at the Council on Foreign Relations, economist Brad Sester and a counterpart at Roubini Global Economics make their best estimate of the size of sovereign wealth funds (SWFs). The financial crisis of 2008 put a dent in Gulf funds, but collectively they are still sizable, exceeding $1 trillion, and growing, albeit slower — ultimately contingent on the price of crude and domestic financing needs. See the table below and take note of the first two listings, both of the UAE and the total figure for the GCC (Gulf Cooperation Council), as well as the SAMA (Saudi Arabian Monetary Agency), although the latter is said to be predominately invested in traditional reserves as opposed to riskier assets. Finally, see also a post from last summer by TradeFlow21’s Steven Towns, which briefly explains the importance of SWFs and takes a look at top funds’ assets per capita. [...]