JPMorgan: Africa Has Solid Strength in Sovereign Wealth Funds
According to JPMorgan Asset Management Inc., Africa is experiencing a strong growth in new sovereign wealth funds globally. This was after the continents nations' buildup commodity revenues and foreign exchange reserves.
Fifteen state funds have been set up in Africa in the past two years. The region is to see more of the investments to occur in the coming years.
Angola set up US$5 billion state fund in October. Uganda stated that in April, it plans to create sovereign fund. Eight months ago, Nigeria also inaugurated US$1 billion.
As the commodity prices increase, countries in Africa are getting their surpluses into funds owned by the government. These funds are designed for wealth management to be used in the future generations.
According to an interview in June 6, Patrick Thomson, global head for sovereigns at JPMorgan, stated that there are two main reasons for more sovereign wealth funds being set up in Africa.
Like countries in the Middle-East and Asia, Africa is also catching up with state funds.