Qatar’s Busy SWF

Ashby Monk

Is there a more active SWF in the world today than the Qatar Investment Authority? I’m not sure. It definitely rivals the China Investment Corporation. Stories about the QIA — and its various subsidiaries — seem to pop up on an almost daily basis.

For example, Qatar just bought Harrod’s. It just set up a billion dollar infrastructure fund in Indonesia. It recently bought the US Embassy building in London. It’s a large shareholder in VW. It’s launching a hotel in Cuba. The list of deals and strategic investments is a long one. In fact, one source puts the Qatari investment spree to date at around 45 billion pounds! This is pretty darn remarkable given that the fund was only set up in 2005.

And I’m not the only one who’s noticed. Cahal Milmo of The Independent has a nice article outlining the recent history of the Qatari wealth fund:

“By an accident of geography, this one-time impoverished British protectorate, whose earnings once came largely from pearl fishing, now finds itself sitting on 26 trillion cubic metres of gas – the world’s third largest reserve – and, as a consequence, a per capita income of $83,000 that is second on the planet only to the banking enclave of Liechtenstein

The advent of sovereign wealth funds – those seemingly bottomless reserves of state-owned money available for investment by cash-rich countries – has been one of the more dramatic developments on the world’s stock exchanges in recent years. But none can match the speed and scale with which Qatar has set about spending its surplus cash to acquire, either in whole or in part, some of the oldest and biggest companies in markets from Britain and France to Morocco, Sudan, the Seychelles and Indonesia.

After securing a sizable stake in the London Stock Exchange three years ago, the QIA has moved with almost breathtaking speed to buy shares in the Sainsbury’s supermarket chain, the Barclays and Credit Suisse banks and the third-largest stake in Volkswagen. There has even been a deal between the country and Fidel Castro’s Communist Cuba to build a 250-bedroom luxury hotel on the island’s Cayo Largo…”

It’s interesting. I’ve actually come to see how active the QIA has been indirectly. Indeed, a large proportion of the information requests we receive from the private sector — and we do field quite a lot of queries from asset managers and businesses leaders looking for information on SWFs — are about the Qatar Investment Authority. In fact, I’d say we get more questions about the QIA than even the CIC.

Now, I’m guessing this stems from the fact that the QIA is extremely opaque (even compared to the CIC, which has actually become increasingly transparent). Nonetheless, the widespread interest in the QIA likely reflects its status as a global investor. The QIA seems to be everywhere right now.

5 Responses to “Qatar’s Busy SWF”

  1. 1 Victoria Barbary May 13, 2010 at 11:36 am

    Absolutely Ashby. I’ve been fascinated by QIA since I started on SWFs. I think it’s worth noting that QIA has always been fascinated by London; surprisingly the Chairman is an Anglophile and will own the most expensive penthouse in the world when it’s finished at No. 1 Hyde Park. Could there possibly be a connection?

  2. 2 Ashby Monk May 14, 2010 at 10:34 am

    An interesting theory, Victoria! There has to be something to the notion that the QIA is investing in “prestige” as much as anything else. That being said, today’s news of a $5 billion (!) joint effort with 1MDB in Malaysia is quite intriguing. Anyway, thanks for reading…

  1. 1 SWFs “Back on Course” « Oxford SWF Project Trackback on May 17, 2010 at 11:00 am
  2. 2 QIA: The Emirate’s Intriguing Wealth Fund « Oxford SWF Project Trackback on October 25, 2010 at 10:28 am
  3. 3 Qatar Investment Authority Wikileaked « Oxford SWF Project Trackback on July 12, 2011 at 11:24 am

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This website is a project of Professor Gordon L. Clark and Dr. Ashby Monk of the School of Geography and the Environment at the University of Oxford. Their research on sovereign wealth funds is funded by the Leverhulme Trust and The Rotman International Centre for Pension Management.

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