A yearly financial statement, released on Saturday, unveiled a record-breaking surge in assets held by national wealth funds and public retirement schemes. The combined holdings reached a staggering $31.9 trillion in 2021, fueled by a robust US equities market and elevated oil prices. Investment activity also soared to multi-year highs, defying lingering anxieties about the pandemic.
Data compiled by a global sovereign wealth fund tracking service indicates a substantial year-over-year increase in managed assets. Specifically, sovereign wealth fund assets climbed 6%, reaching $10.5 trillion, while government pension fund assets experienced a 9% jump to $21.4 trillion.
The study further disclosed a significant rise in investment activity by governmental institutional investors. Both transaction volume and deal size hit six-year peaks, with total expenditures reaching $215.6 billion. Half of this sum originated from sovereign wealth funds.
Singapore’s national wealth fund emerged as a dominant player, exhibiting a remarkable 75% surge in deal participation, totaling $31.1 billion across 109 transactions. A substantial portion of this investment, roughly one-third, targeted real estate, focusing primarily on logistics sectors.
In his analysis within the report, Diego Lopez highlighted a significant disparity. Developing economies significantly underperformed, drawing only 23% of investment capital this year—one of the lowest proportions in the last six years.
The document noted sustained investor scrutiny of China, particularly regarding the crackdown on Chinese tech firms.
The report concluded that despite geopolitical uncertainties and regulatory concerns, state-owned investment bodies mostly maintain optimism toward Chinese equities.
The overall asset growth was bolstered by the establishment of four new sovereign wealth funds during the year. The platform’s yearly review encompasses data from 161 sovereign wealth funds and 275 government pension funds.
