African sovereign wealth funds and national investment funds have been gaining in prominence over the past few years. 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 been growing steadily thanks to the development of primary industries (mostly oil) and better fiscal discipline.
While these types of funds normally look to make international investments like Nigeria’s foray into US fixed income this year, they can also be a big player in local equity markets. More developed Asian countries have shown that these national investment funds can be used to prop up local equity markets in times of need, such as Hong Kong during the Asian financial crisis in 1998. More recently, we have seen the impact that government investment funds can have in Rwanda, where Crystal Ventures, the investment fund owned by the ruling political party, recently announced they would unload their stake in MTN, the largest telecom company in the country.
We’ve compiled an up-to-date list of African sovereign wealth and investment funds. The ones we saw online were incomplete, and we’ve listed several countries that have proposed sovereign wealth funds but have not seeded them with capital yet (Kenya, Sao Tome & Principe, South Sudan, and Tanzania).
Here’s the complete list of African sovereign wealth funds: (Updated as of Dec 2013)
|Algeria||Fund for the Regulation of Receipts (FRR)||77,200.0||2000||Funded by oil & gas profits|
|Angola||Fundo Soberano de Angola (FSDEA)||5,000.0||2012||7.5% of fund to social projects|
|Botswana||Pula Fund||6,900.0||1994||Funded by diamond profits|
|Chad||Oil Revenue Management Plan||–||2003||Created with World Bank, scrapped in 2008|
|Equatorial Guinea||Fund for Future Generations (FFG)||80.0||2002||Funded by 0.5% of all oil revenues|
|Gabon||Fonds Souverain de la Republique Gabonaise (FSRG)||380.0||Funded by oil profits|
|Ghana||Petroleum Holding Fund||72.0||2012||Funded by oil profits, flows to Ghana Heritage Fund and Stabilisation Fund|
|Kenya||120.0||2014||Mining Bill 2013 proposed, Sh10 bio initial start-up expected, funded by minerals|
|Libya||Libyan Investment Authority (LIA)||65,000.0||2006||Funded by oil & gas profits|
|Mauritania||Fonds National des Revenus des Hydrocarbures (FNRH)||300.0||2006||Funded by oil & gas profits|
|Nigeria||Nigeria Soverien Investment Authority||1,000.0||2011||Funded by oil profits, flows to 3 funds: Stabilisation, Future Generations, Infrastructure Fund|
|Rwanda||Crystal Ventures||500.0||2009||Owned by Rwanda Patriotic Front (RPF)|
|Sao Tome and Principe||National Oil Account||–||2004||If oil discoveries are made, profits will go towards this account|
|South Sudan||Oil Revenue Stabilization Account, Future Generations Fund||–||2013||15% of oil profits go to Stabilization Account, 10% to the Future Generations Fund|
|Tanzania||Natural Gas Reserve Fund||–||2013||Funded by gas profits|