ABU DHABI — The U.N. recently announced that Gulf sovereign wealth funds have lost up to US$350 billion in 2008 as a result of the global economic crisis. Sovereign wealth funds were among the most proactive investment bodies in the world over recent years, and tended to undertake riskier investments, aimed at acquiring strategic holdings in multinational companies.
Funds from Saudi Arabia, Kuwait, Qatar and Abu Dhabi managed to maintain their total asset value at the end of 2008, but only after their governments had injected huge amounts from oil revenues into the funds.
According to the 2009 World Investment Report, assets held by the four Gulf States fell to $1.11 trillion last year, down from $1.16 trillion at the end of 2007. Government injections of $300 billion helped to limit the losses, however.
The Abu Dhabi Investment Authority suffered the greatest loss, with a decline in value of $183 billion, down from $453 billion in 2007. The government invested $57 billion into the fund, increasing its value to $329 billion at the end of last year.
The Kuwait Investment Authority, which owns assets in both Daimler and Citigroup, lost $94 billion, from a high of $262 billion in 2007. After the Kuwaiti government invested $59 billion, the fund finished 2008 at $228 billion.
The Qatar Investment Authority lost $27 billion and ended up with a value of $66 billion at the end of 2008.
The Saudi fund, with assets managed by the Saudi Arabian Monetary Agency, lost $46 billion in 2008 and ended the year valued at $501 billion.