GIC CEO Lim Chow Kiat held firmer hold on Singapore funds last year
After leading the world in state-funded investments for five consecutive years, Singapore’s GIC and Temasek Holdings both cut their commitments by more than half last year, with the companies injecting a combined $26.2 billion in new capital last year.
That total is less than half of the $53 billion they will spend in 2022, according to a ranking released this week by the sovereign wealth fund site GlobalSWF. GIC spending decreased 51% to $19.9 billion in 2023 from $40.3 billion in the same period last year. The sovereign wealth fund lost its top spot as the world’s most active state-owned investor for the first time since 2017, moving to second place.
After taking fourth place in 2022, Temasek reduced its investment in 2023 to $6.3 billion from $13.5 billion the previous year, placing it seventh on the list. Rising oil prices also helped, with Saudi Arabia’s Public Investment Fund (PIF) claiming the highest amount. Last year, it deployed $31.6 billion in capital, establishing itself as the world’s most active sovereign investor, an increase of 53 percent from $20.7 billion the year before.
“2023 will see significant market volatility and distress, and sovereign investors continue to exercise caution,” Global SWF said in a report released on Monday. “Gulf SWFs are increasing their control over global trading activity, to the detriment of Singapore and Canadian funds.”
look to emerging markets
GIC’s capital injection in 2023 was the fund’s lowest since the $17.7 billion it disbursed during the pandemic in 2020, while Temasek’s contribution last year was the group’s lowest since 2017. became.
Lim Bun Heng, Chairman of Temasek Holdings
With core market assets under pressure and leverage opportunities more limited last year, GIC nearly tripled its investments in developing markets compared to 2022. Among the fund’s major transactions was a joint venture with Brookfield India REIT, which acquired two commercial buildings in India. As of May, it was valued at approximately $1.4 billion.
Temasek has also focused on emerging markets in the last year, particularly in India, and its Maple Tree Investments unit formed a C$2.5 billion (then $1.86 billion) office joint venture with Canada’s Ivanhoe Cambridge in February. was established.
Top 5 replacement
Sovereign funds managed a total of $124.7 billion worldwide in 2023, down 20% from the previous year, while public pension funds reduced their investments by 26% to $80.4 billion over the same period. became.
In addition to Saudi Arabia’s PIF rising to the top spot, Abu Dhabi’s Mubadala Investment Company rose from sixth place in 2022 to third place last year with $17.5 billion in capital invested. Abu Dhabi Investment Authority fell from second to fourth place with $13.2 billion. For investment in 2023.
Canada Pension Plan Investment Board remained in fifth place after investing $9.4 billion last year.
In terms of assets under management, state-owned investors will benefit from financial market recovery and high oil prices in 2023, with total assets under management of sovereign wealth funds increasing by 7% year-on-year to $11.2 trillion at the end of the previous year. reached. Year. Public pension funds’ balances under management rose 3.6% over the same period to $23.1 trillion.
With assets under management estimated at $769 billion at the end of 2023, GIC ranks sixth among global sovereign wealth funds, while Temasek ranks 10th with $288 billion.
Norway’s Norges Bank Investment Management remains the world’s largest sovereign wealth fund with $1.4 trillion in assets under management, while China Investment Corporation leads Asia with $1.24 trillion.
Global SWF projects that GIC will be the seventh largest government investor in the world with $1.24 trillion in assets under management by 2030.
Featured data centers
In value terms, direct real estate investment by state-owned investors (SOIs) decreased by 40% to $32.8 billion last year, compared to $54.4 billion in 2022.
Despite the reduction in cash, state-owned investors last year raised the proportion of their commitments to invest in real estate assets for the first time since 2014, with 26% of new capital being directed to the real estate sector, the report showed. From 20% in 2022.
Last year, funds poured into data centers, among state-owned investors’ favorite real estate investments, surged 150% to a record $7.6 billion worldwide. This includes a $2 billion joint venture set up by India’s National Investment and Infrastructure Fund with Singapore-based operators Digital Edge and AGP. Sustainable Real Estate Assets January 2023.
Hotel investment last year also rose 8% to $4.7 billion, led by GIC’s purchase in October of a minority stake in Spanish hotel group Hotel Investment Partners.