Burned by foolish bets on Western financial institutions, sovereign wealth funds are looking elsewhere for new opportunities. The latest example: Singapore’s Temasek Holdings will reduce its exposure to countries within the Organization for Economic Co-operation and Development to 20% of its portfolio from 30%. This from Ho Ching, Temasek’s departing chief executive officer and wife of Singapore Prime Minister Lee Hsien Loong. Shying away from the OECD’s Western members, Temasek will put money into Latin America, Russia and Africa, where its collective exposure will be 10%. Asia (not including Singapore) will stay at 40% and Singapore at 30%, AFP reports. My two cents: build up Latin America big-time, especially Brazil, where durable political stability, rich natural resources, and a robustly rising standard of living provide remarkable investing opportunities – although it may already be too late (pricey) in some sectors. Avoid Russia – any potential gains are offset by vast political risk. Africa’s interesting: Temasek’s incoming boss, Chip Goodyear, has heaps of mining and resources experience from prior corporate gigs. Political risk is subsiding in a few intriguing sub-Saharan African countries. An interesting time to play there, especially with Singapore’s ally, China, entrenched across the continent.
Archive for May 17th, 2009
Investing, Singapore, Sovereign Wealth Funds / Comments Off
How optimistic should one be about India in the wake of the Congress Party-led government coalition’s electoral success? Very, I say. But DJN colleague Ros Mathieson argues the United Progressive Alliance coalition has been “patchy when it comes to acting on promised reforms.” Among the UPA’s “unfulfilled promises ” Ros includes failure to open the banking sector to foreign direct investment or to allow pension funds to invest in the stock market. Fair enough. Have a look at her “Money Talks” column this morning for more: “MONEY TALKS: India Govt May Not Capitalize On Reformist Mood” Continue reading…