Posted by meb at January 15th, 2008

Turkey is seeking a share of the world’s largest sovereign wealth fund, which is being established by Saudi Arabia.

The Saudi Arabian fund will top all other rapidly growing sovereign wealth funds with a commitment exceeding $1 trillion, due to surpass even Abu Dhabi, which will become the runner-up at $900 billion.

In the wake of these developments, Economy Minister Mehmet ÅžimÅŸek traveled to Dubai yesterday to encourage the Saudi Arabia Public Investment Fund and other sovereign wealth funds to increase their investments in Turkey. During his visit the minister will present information on the Turkish economy and the plans of the Turkish government for attracting continuous capital inflow from investors around the world. ÅžimÅŸek will also provide details on fiscal policy, the disinflation trend and key macro targets. Metin Kilci, president of the Privatization Administration (ÖİB), will share an overall assessment of privatizations in 2008 in Turkey and information about current attractive sectors for investment.  The Turkish delegation along with ÅžimÅŸek will also emphasize the improvements in investment conditions and will point out Turkey’s advantage as a hub for transporting energy resources in the Middle East to the energy-hungry Western countries.

Government officials had previously said Turkey could attract around $10 billion in investment from the Gulf countries, excluding the new Saudi Arabia Public Investment Fund, to the real estate, tourism and financial sectors as well as to privatizations.

But this new fund will become a formidable rival for other government-owned investment funds in the Middle East and Asia, which are playing an increasingly active role in channeling capital to Western companies, particularly financial institutions hard hit by America’s mortgage meltdown.

Super seven over $2 trillion in assets

Currently 36 countries or regions have sovereign wealth funds, with some $2.5 trillion in assets under their management — more than the sums invested in hedge funds and private equity funds, according to a report by the Standard Chartered Group.

There are seven large sovereign wealth funds, which are named the “Super Seven,” all of which have assets over $100 billion and make up 80 percent of the revenues of the 36 now in existence. The super seven are: Abu Dhabi Investment Authority (ADIA, $900 billion), The Government Pension Fund of Norway (GPF, $322 billion); Government of Singapore Investment Corporation (GIC, $330 billion), Kuwait Investment Authority (KIA, $213 billion), China Investment Corporation (CIC, $200 billion), The Stabilization Fund of the Russian Federation (SFRF, $127.5 billion) and Singapore’s Temasek Holdings ($108 billion).

source: Today’s Zaman