sovereign wealth funds

The retirement of Gao Xiqing as president of the China Investment Corporation, China’s sovereign wealth fund, has fund managers wondering what the change of leadership will mean for asset allocation and the fund’s use of external managers.

Gao, one of the CIC’s founders, and instrumental in many of its most well-known (and sometimes ill-fated) deals, is to be replaced by Li Keping, who is the chief investment officer. This is the second change in top leadership positions at CIC in less than a year, with Ding Xuedong becoming chairman of CIC in July 2013. Continue reading »

Zimbabwe’s proposed sovereign wealth fund – gazetted in Harare last week – is unlikely to have a material impact on private investment. But, if well-managed, it could do wonders for the country’s bloated public sector. A draft parliamentary bill proposes that a maximum of 25 per cent of mining royalties should be paid into the fund to be managed by the Reserve Bank of Zimbabwe. The SWF will “support fiscal or macroeconomic stabilization” and the achievement of the government’s long-term development objectives. Continue reading »

Africa is at the forefront of bringing financial services to the “unbanked” and new opportunities to seasoned investors. In Monday’s FT special report on Africa Banking and Finance, our correspondents examine the continent’s enormous potential and challenges, writes Justin Cash.

Africa editor Javier Blas looks at the growth of sharia-compliant investments across the continent, whilst Anousha Sakoui assesses bright new prospects for M&A activityContinue reading »

Mugabe: management-speak

It’s a 15,000-word document setting out how the government will “prioritise its programmes… and address the country’s socio-economic challenges.” It’s one of the few substantial documents that analysts can get hold of to look for insights into an opaque administration’s intentions.

No, this is not China. It’s Zimbabwe, with this week’s publication of a document titled Zim Asset (Agenda for Sustainable Socio-Economic Transformation). So Robert Mugabe has also set out his stall for Zimbabwe’s next stage. What’s in it? Continue reading »

Partners in wealth

Wednesday’s announcement that Russia and South Korea would work together on an economic project in North Korea slightly overshadowed another significant announcement linked to Putin’s Seoul visit: a new cross-border investment fund between Korea Investment Corporation and its Russian sovereign wealth fund counterpart, the Russian Direct Investment Corporation.

The fund will start out at $500m, with commitments of $250m apiece, but is expected to reach $1bn in time. It also gives an illustration of how the two sovereign wealth funds are evolving. Continue reading »

The great potash saga rumbles on. With Uralkali’s chief executive in a Belarusian KGB cell, the global potash market paralysed by uncertainty and Belarus’s state coffers in jeopardy, China has jumped into the mix with a surprise decision by CIC, a Chinese sovereign wealth fund, to take a 12.5 per cent stake in the Russian miner.

On the face of it, the deal should bring the saga closer to conclusion. But don’t expect the paralysis to be lifted any time soon. Continue reading »

Overseas funds have rushed to Japan this year to buy the bull market touched off by prime minister Shinzo Abe. And it seems there has been one big seller quite happy to let them: Beijing.

For the past six years companies from Toyota Motor to SoftBank have noticed a custodial account called OD05 cropping up on their shareholder registers. Sometimes identified as “SSBT OD05 Omnibus China”, and sometimes going by “OD05 Omnibus China Treaty”, it is has been linked in media reports to China Investment Corporation, the giant sovereign wealth fundContinue reading »

The Gulf is set for economic growth and accumulation of financial reserves in 2013 says the Institute of International Finance.

Sound familiar? Well that’s because most macroeconomic forecasts make similarly rosy forecasts for the oil-rich region. But the IIF, the world bankers’ club, warns that the good times may not last – and the region’s governments need to pursue economic reform before the outlook changes. Continue reading »

There is a new man at the top of the China Investment Corporation (CIC), China’s sovereign wealth fund, prompting debate about whether the change in personnel will also mean a change in approach.

Lou Jiwei (pictured), who is still listed in CIC’s website as chairman and chief executive officer, became China’s finance minister in March. His successor has not been formally named but it has been locally reported that he is Tu Guangshao, the executive vice mayor of Shanghai. Continue reading »

As the guardian of the nation’s oil windfall, Azerbaijan’s state oil fund has traditionally been a highly conservative investor. But as the global economic slowdown takes the shine off fixed income instruments, Sofaz has embarked on a quest for higher yields. After a first foray into gold and European luxury real estate last year, the fund is sizing up the property market in southeast Asia. Continue reading »

The departing chairman and chief executive of the Libyan Investment Authority has said he was about to appoint lawyers to seek compensation from banks including Société Générale and Goldman Sachs – banks he has accused in the past of causing losses worth billions of dollars.

In a wide-ranging interview published in Euromoney magazine, Mohsen Derregia (pictured), who is being ousted from the LIA after just 11 months in the top job, speaks passionately about his removal – which he is challenging – and the importance of the approximately $60bn sovereign fund. Continue reading »

The investment by China Investment Corporation in Friday’s flotation of the Moscow Exchange carries several messages for observers seeking to understand the investment approach of China’s sovereign wealth fund. Continue reading »

Forget sovereign debt for a moment. This is turning into the year of sovereign wealth, with Angola becoming the latest African country to create a fund to invest some of the proceeds of growing oil riches.

The sovereign wealth fund – known as Fundo Soberano de Angola (FSDEA) – will start with $5bn in assets, and look to invest primarily in sub-Saharan Africa. Angola joins Nigeria and Tanzania in launching or planning to launch a SWF in 2012. Continue reading »

Here’s something you don’t hear very often: Chile and Russia are quite similar.

Odd as that might sound – after all, Chile conjures up images of success, stability and transparency while Russia has, as Ben Aris of bne put it in a post here recently, an “appalling investment image” – that was indeed Michael O’Flynn’s pitch to Chilean investors at a recent conference in Santiago. Continue reading »

It’s a big day on Tuesday for investment banker Uche Orji and, potentially, for Nigeria’s future fiscal stability, too. Orji, who has worked at JP Morgan, Goldman Sachs and most recently UBS, in New York, starts on Tuesday as CEO of the Nigerian Sovereign Investment Authority.

His job will be to establish and manage the country’s proposed $1bn sovereign wealth fund, which is meant to safeguard some oil revenue for later use. Given the many billions of petrodollars squandered or stolen by senior officials in recent decades, few dispute that the SWF is a good idea. But it has not been welcomed by all. Continue reading »