Sovereign Wealth Fund
Definition
A sovereign wealth fund is a state-owned investment fund that manages national savings for the purposes of investment, fiscal stabilisation, and intergenerational wealth transfer. These funds are typically financed by revenues from natural resources, particularly oil and gas.
Context
Oman’s sovereign wealth is managed by the Oman Investment Authority, formed in 2020 through the merger of the State General Reserve Fund and the Oman Investment Fund. The authority manages domestic and international investments to generate returns that supplement government revenues and build reserves for future generations.
Example
The Oman Investment Authority holds diversified investments including real estate, equities, fixed income, and private equity positions across global markets, generating returns that help fund government expenditure when oil revenues decline.