State Oil Fund of Azerbaijan to diversify investment portfolio
Baku, Azerbaijan, Feb. 25
By Maksim Tsurkov - Trend:
The State Oil Fund of Azerbaijan (SOFAZ) is considering the possibility of further diversification of the investment portfolio, SOFAZ head Shahmar Movsumov told Trend Feb. 24.
He said that SOFAZ has already started preparing for investing in the Chinese yuan.
"In this regard, a permission of the People's Bank of China has been already received to invest in the amount of three billion yuan (around $ 500 million)," he said. "At the moment, the preparation is underway to sign a contract with the bank. After the contract is signed, it will be possible to start investing in the Chinese yuan. At the first stage, the investments are planned to be made in the Chinese state bonds."
"SOFAZ bought the real estate in the capital of South Korea - Seoul in 2014," he said.
SOFAZ is also considering the possibility of investing in real estate of other countries in Asia to diversify the investment portfolio.
The total volume of SOFAZ's investment portfolio stood at $36.740 billion, or 98.9 percent of the total volume of its assets as of January 1, 2015.
Some 54.1 percent of the investment portfolio of the Azerbaijani State Oil Fund (SOFAZ) is concentrated in US dollars (around $19.87 billion) as of 2014.
Some 33.9 percent of SOFAZ's investment portfolio is concentrated in euro (10.25 billion euro), 4.8 percent - in British pounds (1.16 billion pounds), 1.2 percent - in Turkish lira, 0.5 percent - Australian dollars, 1.2 percent - Russian rubles, 1.2 percent - Korean Won.
The remaining part of the portfolio (3.1 percent, or about $1.15 million) is concentrated in gold.
As of January 1, 2015, SOFAZ assets increased by 3.42 percent and hit $37.104 billion compared to early 2014 ($35.878 billion).
SOFAZ was established in 1999 with assets of $271 million.
Based on SOFAZ's regulations, its funds may be used for the construction and reconstruction of strategically important infrastructure facilities, as well as solving important national problems.
The main goals of the State Oil Fund include: accumulation of resources and the placement of the fund's assets abroad in order to minimize the negative affect on the economy, the prevention of "Dutch disease" to some extent, promotion of resource accumulation for future generations and support of current social and economic processes in Azerbaijan.
Edited by CN
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