Ghana has already withdrawn US$219million (48% of the Ghana Stabilisation Fund) and Nigeria has withdrawn US$150million (43% of Nigeria’s Stabilisation Fund) to shore-up government budgets – and Ghana’s proposal to drawdown the Ghana Heritage Fund is being debated. Strategic Investment Funds will likely suffer the least impact – although for a while many will struggle to perform their core task of crowding-in private capital. Although there are minimal disclosures, aside from Ghana and Nigeria, on how other SWFs on the continent are spending to support government budgets, it is almost certain that substantial adverse effects will be revealed over the course of time – because of the ‘triple-drain’ dynamics on their assets. African sovereign wealth funds (SWFs) can be put to far greater use as drivers of economic growth in their own economies. A sovereign wealth fund is an investment pool of foreign currency reserves owned by a government. Konfidants is an international advisory firm of consultants, scholars and advisors that specialises in supporting companies, governments, and international organisations to achieve impact. Sovereign wealth funds (SWFs), like other endowments, are designed to preserve wealth for future generations. Algeria’s fund, which was previously Africa’s largest SWF, was virtually depleted even before COVID-19 struck. The fund will target investments locally and neighbouring countries in … While the biggest sovereign wealth funds are in Europe, Asia and the Middle East, African sovereign wealth funds have connued to grow in recent years. You have entered an incorrect email address! SWFI is a minority-owned organization. How soon will they be replenished by governments? Ashesi University Real Estate Club leads discussion on the future of learning spaces –... Chris Koney’s Column: All new season of Date Rush airs on Sunday January 3. Sovereign Wealth Fund Institute (SWFI) is a global organization designed to study sovereign wealth funds, pensions, endowments, superannuation funds, family offices, central banks and other long-term institutional investors in the areas of investing, asset allocation, risk, governance, economics, policy, trade and other relevant issues. Current Assets for Ghana Stabilization Fund is $455,534,395.14 and SWFI has 27 periods … +0.08 +0.17% Abu Dhabi’s top sovereign wealth fund is looking to Africa and renewable energy to generate greater returns, while relying … South Africa plans to use money from mining royalties to establish a US$$2 billion sovereign wealth fund. Reserve funds are then invested … Replenishment of funds will depend on the recovery rate of commodity prices to pre-crisis level, speed of recovery from the recession, and speed of recovery of government finances– all of which depend on recovery from the pandemic. Savings/Future Generation Fundscould end up losing more money than Stabilisation Funds in the short-term – because they have bigger exposures than Stabilisation Funds to the massive wealth evaporation and volatility going on in the world’s stock markets. Errors are noted below: Thanks for reaching out. South Africa’s Finance Minister Tito Mboweni delivers his budget to Parliament in Cape Town. Khattaly Consulting is a USA based firm, specializing in research and consulting services on Sovereign Wealth Funds, International Business and the political economy of the MENA region. Nigeria and Rwanda scored 62.49 % and 62.24 % respectively. For now, we expect most African SWFs to be impacted but not depleted – especially in light of the IMF support that has given governments some fiscal space. Norway is usually regarded as the gold standard here. COVID-19 is a chance for Africa to have its own Marshall Plan, Ghana-UK reach consensus on Continuity Trade Agreement, Asante Bediatuo Family reaches out to Korle-Bu Teaching Hospital Maternity Ward, Ashesi University Real Estate Club leads discussion on the future of learning spaces – Webinar Report, No revenue loss recorded with ICUMS – GRA, Challenges to African Economic development, Revive national carrier to boost economic fortunes-Economist. What happens, though, when the claims of the present are more pressing? It is Africa's second-largest government investment fund. No affiliation or endorsement, express or implied, is provided by their use. However, if the pandemic prolongs over multi-year infection waves with no viable vaccine, many African governments will have no option but to start depleting their SWFs. Experts at advisory firm Konfidants – which publishes the African Sovereign Wealth Funds Index – are projecting that COVID-19 could result in African SWFs suffering combined … The African Sovereign Wealth Funds Index is a multi-year project, designed around 7 main indicators, namely: Governance and Public Disclosure Size of Fund Domestic Investment Mandate Source of Funding (Diversifi cation of Sources) Financial Performance Economic Impact Sustainability This 2018 maiden index focuses on the fi rst 4 of the 7 indicators – for two main reasons. COVID-19 and its enormous economic repercussions on Africa is putting serious strain on the continent’s Sovereign Wealth Funds – which collectively hold some US$87billion in assets under management. Necessary cookies are absolutely essential for the website to function properly. Djibouti created a sovereign wealth fund and is targeting contributions of US$$1,5 billion within a decade. South Africa will use money from the sale of broadband spectrum and mining royalties to establish a 30 billion-rand ($2 billion) sovereign wealth fund, Finance Minister Tito Mboweni said. But opting out of some of these cookies may have an effect on your browsing experience. One of the first African sovereign funds, the Pula Fund, was launched in 1994 by Botswana. In 2009, assets under African SWF management were about US$114.27 billion, but increased by 39% to reach US$159 billion in 2015. Several African countries then followed the lead with Libyan Investment Authority … The Konfidants analysis shows that Stabilisation Funds will suffer the biggest impact in absolute terms – some risk being depleted to the last dollar if the crisis drags over the course of multiple budget cycles. © 2008-2020 Sovereign Wealth Fund Institute. This website uses cookies to improve your experience while you navigate through the website. Conditions are ripe for a South African sovereign wealth fund based on minerals. The FSDEA will be the second-largest sovereign wealth fund in Africa behind Botswana’s diamond exports-funded Pula Fund, with savings equivalent to 5 percent of a $101bn GDP, according to Moody’s. Ø The continent’s biggest fund – Libyan Investment Authority which holds 68% of the continent’s total AUM – had most of its assets frozen following the post-Arab Spring governance crisis. SA sovereign wealth fund idea nothing new A sovereign wealth fund is a state-owned investment fund that is used to benefit the country’s economy and citizens. Experts at advisory firm Konfidants – which publishes the African Sovereign Wealth Funds Index – are projecting that COVID-19 could result in African SWFs suffering combined losses of US$19billion in a best-case scenario and about US$27billion in the worst-case scenario. COVID-19 and its enormous economic repercussions on Africa is putting serious strain on the continent’s Sovereign Wealth Funds – which collectively hold some US$87billion in assets under management. Our area of expertise: Middle East | North Africa | USA. 0. Norway’s SWF – the world’s largest SWF – lost US$113billion in Q1 alone. The FT this week did a special feature on finance and banking in Africa, which you can find here.All the articles are well worth a read but one centered on SWFs in Africa; despite their size lagging SWFs in Asia and the Middle East, national investment funds in Africa have … SWFI facilitates sovereign fund, pension, endowment, superannuation fund and central bank events around the world. It was estimated that about 83% of African sovereign wealth fund assets are drawn from oil … Registration on or use of this site constitutes acceptance of our terms of use agreement which includes our privacy policy. Other third-party content, logos and trademarks are owned by their perspective entities and used for informational purposes only. Sovereign Wealth Fund in Nigeria, Africa Equatorial Guinea Fund for Future Generations. The funds like that in Uganda are mainly commodity-based. Sovereign Wealth Fund Institute® and SWFI® are registered trademarks of the Sovereign Wealth Fund Institute. Even when oil prices were relatively higher before the crisis, Angola, Equatorial Guinea and Gabon had already pursued IMF assistance. African Sovereign Wealth Funds to lose at least US$19bn due to COVID-19. If sovereign wealth were shared out among citizens, Batswana would get a chunky $2,400 each, Norwegians a mammoth $170,000—and Nigerians less than $7. Ø 9 out of 14 functional African SWFs derive their source of funding from hydrocarbons, Ø Oil-fed SWFs hold 74% of the continent’s total assets under management, Ø 80% of total AUM are held as Stabilisation and/or Future Generation Funds.
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