The Qatar Investment Authority (QIA), one of the world’s most opaque sovereign wealth fund, has announced a $10 billion investment fund in Asia.
On Monday, the estimated-$170 billion organization signed a memorandum with CITIC Group, China’s largest conglomerate, to launch a 50/50 investment vehicle dedicated to the country’s assets.
According to QIA’s CEO Ahmad Al-Sayed, the fund plans to pledge as much as $15 billion to $20 billion in the next five years in Asian health care, infrastructure, and real estate.
“We see real long-term investment potential in companies here in China because of the increasing availability of interesting sustainable investment opportunities as the economy develops and diversifies, the growing brand and stature of large Chinese corporates, and the continuing emergence of an affluent and increasingly discerning middle class,” Al-Sayed said at an investment conference in Beijing.
He added the sovereign wealth fund would continue to invest in Europe—where it had aggressively acquired assets such as London’s Harrods department store—but felt the “need to diversify asset allocations and geographical location.”
“We are a financial investor focused on long-term investment performance and we invest internationally across all asset classes,” Al-Sayed said. He announced QIA will be expanding its office in Beijing and New Delhi, and plans to open a new office in New York.
QIA was recently criticized by Switzerland-based political risk consultancy GeoEconomica for falling significantly behind its peers in governance standards.
The firm identified QIA as the only fund that was non-compliant with the “good governance and financial disclosure standards” agreement laid out in 2008—known as the Santiago Principles—and said it “has yet to take any meaningful steps to meet some of the principles’ basic disclosure standards.”
Earlier this year, another GeoEconomica report said QIA has begun to shed its nickname “the deal hunter.” It said the Qatari fund’s asset allocation behaviors have become more conservative to better align with the nation’s economic development agenda and stronger regional presence.
“Given Qatar’s economic development agenda for the years ahead, any sensible sovereign wealth investment policy will necessarily have to factor in the uncertainties and risks that the country is and will be exposed to in a tense geo-economic space,” the report said. “Qatar’s more exposed international position today might result in QIA taking a more holistic investment approach in the future.”
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