Amit's Blog

  Part 3 – Singapore and a few more prominent SWFs "Returns matter a lot. It's our capital." — Abigail Johnson SWF of Singapore Singapore is similar to Norway in terms of population. However, unlike Norway, it is a small area being a city-state. Also, unlike Norway, Singapore is not a resource-based economy. The foundation of Singapore is Trade and Logistics. It has the second-largest container port in the world in terms of traffic and has a well-developed financial market. GIC Private Limited is the sovereign wealth fund established by the Government of Singapore in 1981 to manage Singapore's foreign reserves. Its mission is to preserve and enhance the international purchasing power of the reserves, with the aim to achieve good long-term returns above global inflation over the investment time horizon of 20 years. GIC invests internationally in developed market equities, emerging market equities, nominal bonds and cash, inflation-linked bonds, private equity, ...

  Part 2 - The story of the Norwegian SWF and The SWF of China "With a good perspective on history, we can have a better understanding of the past and present, and thus a clear vision of the future." — Carlos Slim Helu The Norway Story The Sovereign Wealth Fund of Norway is one of the largest and the most talked about. The story of its evolution gives valuable insights on institution building. It wasn’t built in one day as a masterstroke. Rather, processes were put in motion which played out over a couple of decades. It continues to evolve and has a high level of stakeholder participation. When oil production started in Norway in the early 1970s, the government there was aware of the risks to the domestic economy. The oil shock of the seventies also occurred then. Unlike the Persian Gulf states, Norway already was a developed economy without oil. It was also known that the oil reserves would not last more than 50 years. Therefore, from an early stage, the government w...

  Part 1 – What are Sovereign Wealth Funds   “In life’s journey, having the ability to predict the future gives us an unfair advantage. If we can understand the laws of cause and effect, anyone can predict the future. What we do today leads us to tomorrow’s destination. Why does this simple truth seem to be difficult for most people to understand?” ― Celso Cukierkorn Sovereign Wealth Funds (SWFs) are not understood very widely, although they aren’t new. Several funds have been operating at a global level for more than fifty years. However, the big thrust came during the early years of this century. The number of funds created during this century represents the majority of the total in existence. Earlier, these funds (state-run), operated under the radar, maintaining a low profile in the public eye. Very broadly, SWFs have been regarded as investment vehicles established in order to manage, in a profit-oriented way, surplus national wealth for future generations. The la...