complete guide to sovereign wealth funds written by and for industry practitioners Sovereign wealth funds (SWFs) aren't new, but they are often misunderstood. As they've attracted more attention over the last decade and grown greatly in size, the need for a new and thorough resource on SWFs has never been greater. These funds will only grow more important over the coming years. In this book, expert authors who work in the industry present a comprehensive look at SWFs from the perspective of western investors.
Foreword List of Tables List of Abbreviations Acknowledgements Introduction A few stylized facts SWFs under the spotlight Misplaced fears The plan of the book Chapter 1. The macroeconomic dynamics of SWFs 1.1 Persistent Current Account Surpluses Translate into Accumulation of Foreign Assets 1.2 Absorption Constraints: The rationale for establishing SWFs and FWFs 1.3 The management of natural resources windfall 1.4 Commodities demand and the super-cycle theory 1.5 SWFs as alternative to an income tax system: what if Norway becomes like Saudi Arabia? Chapter 2. Size and Growth of SWF Assets 2.1 Size and clusters of the SWF 2.2 Drivers of SWF growth 2.3 The optimal level of FX reserves 2.4 Future growth of FX reserves: Commodity versus non-commodity exporting countries 2.5 Size of SWFs by 2016 Appendix: How big could SWFs be by 2016? Chapter 3. SWFs as investors in global markets 3.1 Clustering of SWFs in terms of objectives and investment profiles 3.2 SWF as strategic investors in domestic and global markets 3.3 Geographical and sectoral distribution of SWF direct investments: the 2007-08's surge of investments in Western financials. 3.4 Investment Performance of SWFs and the impact of the financial crisis 3.5 Explicit and implicit liabilities of SWFs 3.6 Long term investments: SWFs as the ultimate risk bearers Chapter 4. Risk management for SWFs 4.1 The crisis in retrospect 4.2 The complex qualitative nature of risk: uncertainty, chaos, black swans and fat tail 4.3 Banking regulation, herd behaviour and contagion 4.4 The evolution of the regulatory framework 4.5 Sketches of Risk Management for SWFs 4.6 An unconventional dimension of risk management: shareholders vs stakeholders Chapter 5. SWFs in the geopolitics of the XXI century 5.1 The shift to East of the global economy: the New Silk Route 5.2 The law of unintended consequences? China's influence through financial muscle 5.3 SWFs investing in the less developed economies: Africa as the last investment frontier 5.4 The new financial geographic: the emerging multipolar financial architecture 5.5 The dominance of the USD in global financial markets: SWFs as USD diversifiers 5.6 SWFs and the new regulatory framework for financial institutions: the upcoming 'war for capital" Chapter 6. The politics of SWF engagement 6.1 National responses to the growing role of SWFs 6.2 International response to the growing role of SWFs 6.3 SWFs response to international pressure 6.4 Santiago principles: rationale, implementation and reality 6.5 A digression on public versus private role in the economy Chapter 7. Wrapping up 7.1 Towards a multipolar world 7.2 Governments' activism in economic and financial affairs 7.3 Barbarian at the gates or welcome partners? 7.4 The end of the saving glut and the coming era of capital scarcity 7.5 Towards a multicurrency regime 7.6 A proposal to allay fears over transparency 7.7 The new responsibilities on the global scene Bibliography Subject Index
