LONDON: Sovereign Wealth Funds’ (SWFs) redemptions from global stock and bond markets fell by about a third year-on-year to $38.1 billion in 2017, preliminary data from research firm eVestment showed on Wednesday.
Fourth quarter outflows slowed to $2.5 billion, the lowest level since SWF redemptions from third-party asset managers began in the third quarter of 2014, suggesting the high watermark of selling has passed.
The figures from eVestment, which collates data from about 4,400 firms managing money on behalf of institutional investors, are preliminary as fund managers holding about a fifth of the prior quarter’s assets have still not reported, but the directional trend is not expected to change, the firm said.
Oil-backed sovereign funds were put under pressure when oil prices tumbled from their mid-2014 highs of $115 a barrel to below $30 in January 2016, forcing governments to dig into their rainy-day SWFs to fill budget gaps.
In 2015 redemptions topped a whopping $80.1 billion as SWFs liquidated stocks and bonds to raise cash. The selling continued throughout 2016 with some $58.8 billion of outflows.
But with oil prices rising in 2017 to trade at around $65 a barrel by year-end, the level of redemptions has slowed.
Fourth quarter redemptions were down from a revised $5.5 billion in the third quarter, and from $7.6 billion in the second quarter.
However Peter Laurelli, global head of research at eVestment, noted that 66 percent of investment products still experienced net outflows, with only a third registering inflows.
Among those with net inflows were passively-managed non-US equity strategies, which pulled in $1.4 billion in the fourth quarter, and passive US equity, with $823.5 million.
Global equity markets rallied hard in 2017, with the MSCI World Index gaining around 20 percent and US equities 19 percent.
Actively-managed strategies continued to suffer sizeable outflows, with non-US. equity products losing $2.2 billion.
Low-yielding bond products also remained out of favor, with non-US fixed income losing $1.7 billion.
Since the global financial crisis, the $6 trillion SWF sector has cut its allocation to government bonds and ramped up its exposure to unlisted assets such as private equity, property and infrastructure in pursuit of higher returns.
Sovereign fund redemptions from global markets fall 35% in 2017
Sovereign fund redemptions from global markets fall 35% in 2017
Gulf-EU value chain integration signals shift toward long-term economic partnership: GCC secretary general
RIYADH: Value chains between the Gulf and Europe are poised to become deeper and more resilient as economic ties shift beyond traditional trade toward long-term industrial and investment integration, according to the secretary general of the Gulf Cooperation Council.
Speaking on the sidelines of the World Governments Summit 2026 in Dubai, Jasem Al-Budaiwi said Gulf-European economic relations are shifting from simple commodity trade toward the joint development of sustainable value chains, reflecting a more strategic and lasting partnership.
His remarks were made during a dialogue session titled “The next investment and trade race,” held with Luigi Di Maio, the EU’s special representative for external affairs.
Al-Budaiwi said relations between the GCC and the EU are among the bloc’s most established partnerships, built on decades of institutional collaboration that began with the signing of the 1988 cooperation agreement.
He noted that the deal laid a solid foundation for political and economic dialogue and opened broad avenues for collaboration in trade, investment, and energy, as well as development and education.
The secretary general added that the partnership has undergone a qualitative shift in recent years, particularly following the adoption of the joint action program for the 2022–2027 period and the convening of the Gulf–European summit in Brussels.
Subsequent ministerial meetings, he said, have focused on implementing agreed outcomes, enhancing trade and investment cooperation, improving market access, and supporting supply chains and sustainable development.
According to Al-Budaiwi, merchandise trade between the two sides has reached around $197 billion, positioning the EU as one of the GCC’s most important trading partners.
He also pointed to the continued growth of European foreign direct investment into Gulf countries, which he said reflects the depth of economic interdependence and rising confidence in the Gulf business environment.
Looking ahead, Al-Budaiwi emphasized that the economic transformation across GCC states, driven by ambitious national visions, is creating broad opportunities for expanded cooperation with Europe.
He highlighted clean energy, green hydrogen, and digital transformation, as well as artificial intelligence, smart infrastructure, and cybersecurity, as priority areas for future partnership.
He added that the success of Gulf-European cooperation should not be measured solely by trade volumes or investment flows, but by its ability to evolve into an integrated model based on trust, risk-sharing, and the joint creation of economic value, contributing to stability and growth in the global economy.
GCC–EU plans to build shared value chains look well-timed as trade policy volatility rises.
In recent weeks, Washington’s renewed push over Greenland has been tied to tariff threats against European countries, prompting the EU to keep a €93 billion ($109.7 billion) retaliation package on standby.
At the same time, tighter US sanctions on Iran are increasing compliance risks for energy and shipping-related finance. Meanwhile, the World Trade Organization and UNCTAD warn that higher tariffs and ongoing uncertainty could weaken trade and investment across both regions in 2026.
