Dubai Launches New Fund to Manage Government Investments

In an effort to strategically oversee government investments, Dubai has set in motion a law to create the Dubai Investment Fund, described as an 'independent public entity.' The establishment of this fund serves as a pivotal step initiated by Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, to boost investment in projects of strategic importance.

The portfolio of the Dubai Investment Fund is set to include prominent stakes in notable enterprises such as the utility heavyweight DEWA, toll operations Salik, and the Dubai Taxi Company. These entities have undergone privatization processes in the past and now find a new oversight structure in the form of this investment fund.

Another significant enterprise, Dubai World, which has stakes in DP World, will come under the umbrella of the Dubai Investment Fund, although it will retain its legal identity. The sovereign fund is tasked with the investment of government funds, surpluses, and general reserves, both locally and internationally.

Apart from its power to create or participate in companies and investment entities, the Dubai Investment Fund holds the authority to engage in mergers and acquisitions. The objective is to mobilize robust financial reserves to improve the financial health of the emirate as well as to support government deficits.

Sheikh Maktoum bin Mohammed bin Rashid al-Maktoum will lead the fund as chairman, with Abdulrahman Saleh Al Saleh appointed as vice chairman of the board. The fund's managing director and CEO is Abdulaziz Mohammed Al Mulla.

With a focus on the investment market, the fund will actively seek out opportunities in stocks, bonds, and securities in pursuit of sustainable profits. Its activities will not be limited to investments, as it will also deal with asset management, mortgages, guarantees, and derivatives.

Dubai's New Wealth Fund: A Financial Juggernaut

The Dubai Investment Fund joins the ranks of the already-established sovereign fund, the Investment Corporation of Dubai (ICD), with an impressive $320 billion in assets. The ICD, as the main investment arm of the government, has seen a robust increase in half-year profits, propelled by strong economic momentum in the UAE, and holding stakes in the Emirates Group, Emaar Properties, and other significant companies.

Global Perspectives on Wealth Funds

Spotlighting global endeavors, Kuwait's recent announcement to establish a new wealth fund, aimed at developing its domestic economy, is part of a wider trend in the region. These initiatives are foundational in transforming the Gulf economies and securing foreign investment while enhancing private sector engagement.

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