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Commentary

Wed 8 Aug 2018 / Global

Pension funds for infrastructure

A gigantic problem bedevils efforts to harness development funds for much-needed infrastructure investment in emerging markets. Massive volumes of financial resources controlled by pension funds and other long-term financial institutions around the world are held back from investment in developing countries because of fears of unmanageable political risk. But improvements could be on the way if the precepts of an 'eminent persons group' assembled by the G20, due to report in coming weeks, are properly implemented.

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Wed 4 Jul 2018 / Asia Pacific,Europe

Tale of two creditors

Germany has advanced to the position of the world's No.2 net creditor, taking over the position during the past 12 months from China, which has been moving its foreign surpluses into strategic equity holdings and away from holdings of other governments' debt. Much of Germany's build-up is in non-interest-bearing, unconditional advances within economic and monetary union – much of which will probably never be fully repaid. In this tale of two creditors, China's system of state control and long-term planning is displaying some ostensible benefits.

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Wed 23 May 2018 / Asia Pacific,North America,Latin America Caribbean,Middle East,Africa,Europe

Economic recovery and equity rally swell public sector assets by $2.5tn

The global economic recovery and upturn in equity markets boosted central bank, sovereign fund and public pension fund assets by $2.5tn in 2017 according to Global Public Investor 2018. The surge is the largest increase in the five years since OMFIF began tracking the assets of the 750 institutions covered in the GPI.

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Mon 21 May 2018 / Asia Pacific,North America,Europe

Flexibility in allocation strategy

Bonds have been one of the worst-performing asset classes over five, 10 and 20 years, and oil prices have declined dramatically since 2014. This combination of forces, exacerbated by a decade of quantitative easing, low interest rates, slow productivity growth and aging populations in advanced economies, has led to heated debate over which asset classes and strategies public investors should pursue. It has also helped to intensify the shift into alternative assets, particularly real estate and infrastructure.

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Mon 9 Apr 2018 / Europe

Chinese investment divides EU

Views on Chinese investment into the EU are dividing core and peripheral member states. Moves by the Commission to strengthen screening of foreign investment have found support in France and Germany, whose governments worry about the move of assets considered important for public security into Chinese hands. Businesses also fear the transfer of know-how and its ability to transform China into a competitive tech hub. But they are at odds with Europe's crisis-hit south, which views China as a source of much-needed foreign funds.

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Fri 23 Mar 2018 / Asia Pacific,North America,Latin America Caribbean,Middle East,Africa,Europe

G20 debates 'hot' cryptocurrencies

The G20 meeting of finance ministers and central bank governors in Buenos Aires was good for cryptocurrencies. Representatives commented that they were a 'hot topic', but that governments were 'far behind' when it comes to understanding them. Care was taken to label cryptocurrencies as crypto-assets to make sure there is no mix-up with fiat currencies. Central banks are accustomed to having the right to issue sovereign currencies that are the sole legal tender in their countries and several appeared highly defensive of their privileges.

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Tue 20 Mar 2018 / Asia Pacific

What China's new governor should do

Yi Gang, the new governor of the People's Bank of China, takes over at a time when Beijing is placing far greater emphasis on controlling risk in a Chinese financial system that even leading officials admit contains dangers of implosion. At the same time, in view of a leadership vacuum in world politics and economics stemming from US unilateralism, opportunities for China from its own brand of targeted monetary internationalism are greater than ever.

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Tue 6 Feb 2018 / Asia Pacific,North America,Europe

Gold's sovereign fund appeal

A low interest rate environment over the past decade has led sovereign funds to search for higher yields and, in the process, turn towards alternatives. Gold has a negative correlation with equities and performs well during downturns. Principal preservation is attained while the value of investments is protected from possible decreases in the purchasing power of the currency the asset class is expressed in. Only gold can rival traditional investments with regards to liquidity.

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Fri 13 Oct 2017 / Africa

Six pillars of African growth

In the light of the post-2014 commodity cycle downturn, many African countries have prioritised initiatives to improve their economic governance, increase their fiscal sustainability, and diversify their economies. One essential consideration for the next stage of Africa’s development is the expansion of its financial markets, which will provide additional growth and funding opportunities to local businesses. A new OMFIF report launched today – the Barclays Africa Group Financial Markets Index 2017 – provides a valuable tool for tracking the development of financial markets across the continent.

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Wed 11 Oct 2017 / Africa

Barclays Africa Group Financial Markets Index 2017

Africa’s large, youthful and dynamic markets present opportunities for growth on the continent. However, foreign and local investment prospects are hampered by several factors, including underdeveloped financial markets and unclear legal and regulatory frameworks. These are some of the conclusions drawn from the Africa Financial Markets Index - a newly released index produced by think tank OMFIF and sponsored by Barclays Africa Group Limited (BAGL).

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