Sovereign wealth fund assets to hit $5.2trn – report

Assets managed by sovereign wealth funds are likely to grow 8 per cent this year to $5.2 trillion after a 9 per cent increase in 2011, a new report has shown. Financial services representative body TheCityUK said assets managed by the world’s sovereign wealth funds (SWFs), which manage countries’ windfall revenues for future generations, rose for the third consecutive year to a record $4.8 trillion in 2011.
Sovereign investment vehicles, such as pension reserve funds, development funds and state-owned corporations’ funds held $7.2 billion, on top of $8.1 trillion in official foreign exchange reserves — usually held by the central bank. “Taken together, governments of SWFs, largely those in emerging economies, have access to a pool of funds totaling $20 trillion,” the report said. Countries affected by the recent political instability in the Middle East and North Africa collectively manage around $160 billion in SWF assets, or around 4 per cent of the total.