Gulf sovereign fund assets set to hit $18 trillion by 2030
Spearheaded by the UAE's three major funds, Gulf Sovereign Wealth Funds (SWFs) are emerging as key players in the global investment arena.
With total assets under management projected to soar from $12 trillion at the end of 2024 to $18 trillion by 2030, these funds are set to redefine the global investment landscape.
At the forefront are five formidable entities: the Abu Dhabi Investment Authority (Adia), Mubadala, Abu Dhabi Developmental Holding Company, Saudi Arabia's Public Investment Fund (PIF), and the Qatar Investment Authority (QIA). Together, they dominate regional investment activities, showcasing the Gulf's growing influence on the global stage.
A remarkable trend accompanying this growth is the rise of Royal Private Offices (RPOs), which now control around $500 billion in assets. According to a Deloitte report, these RPOs have become essential in shaping the future of sovereign wealth funds in the region. They often mirror the activities of established funds, blurring the lines between state-controlled entities and private family offices. This trend has led to the creation of new funds linked to influential families, further diversifying the Gulf's investment portfolio.
The report highlights that Gulf SWFs have been on an aggressive investment spree, deploying $82 billion in 2023 alone and another $55 billion in the first nine months of 2024. With approximately 40 per cent of global SWF assets under their control, and six of the ten largest funds worldwide, these entities are not just participants — they are reshaping investment strategies amid intensifying competition.
Julie Kassab, Deloitte's sovereign wealth fund leader for the Middle East, underscores the Gulf region's pivotal role: 'We are witnessing these funds not only expand their geographical footprint but also significantly enhance their internal capabilities. They are setting new standards for performance and governance.'
A significant shift in focus is evident as Gulf funds increasingly invest in fast-growing markets outside traditional Western economies. With an eye on Asia, they are establishing offices in the Asia-Pacific region and ramping up allocations to burgeoning economies such as China, India, and Southeast Asia. Notably, Gulf SWFs have invested an estimated $9.5 billion in China in the year ending September 2024, positioning themselves as key players in a market where Western investors are pulling back.
Africa is another frontier of interest, particularly in the mining sector, as Gulf states look to capitalise on high-risk extractive ventures. The UAE and Saudi Arabia are actively investing in this area, both directly and through multinational mining firms, signaling their readiness to explore new opportunities.
As competition intensifies, Gulf SWFs are under pressure to enhance their performance and risk management practices. Many are adopting a more proactive stance, seeking better reporting from portfolio companies and asserting influence at the board level. This drive for excellence has also intensified the competition for talent, with Gulf funds employing around 9,000 professionals and offering attractive packages to lure seasoned experts from established global funds.
However, the global landscape is shifting towards protectionism, particularly in developing economies. Governments are reassessing their strategies regarding strategic assets, leading to the emergence of domestically focused funds that aim to co-invest alongside international partners rather than compete directly with Gulf players.
Deloitte also notes a growing trend toward protectionism globally, particularly in developing economies, where governments are reassessing their approach to strategic assets. This shift has led to the creation of new domestically focused funds, often designed to co-invest alongside international partners rather than compete directly with established Middle Eastern players.
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