Singapore wealth fund GIC says US will remain prime destination
SINGAPORE Feb 24 (Reuters) - The Singapore government's $200 billion sovereign wealth fund said the United States, which accounts for more than a third of its investments, will continue to be a prime destination for years to come.
Tony Tan, the Government of Singapore Investment Corp's (GIC) deputy chairman, said in New York on Wednesday that despite global economic rebalancing and rapid growth in China and other emerging economies, the United States would remain the "single most important source of global prosperity."
"Despite the shift in economic power, and GIC's desire to take advantage of opportunities in the emerging world, the U.S. will continue to be a prime destination for GIC's investments for years to come," he said.
"More than a third of GIC's investments are in the U.S."
A copy of his speech was made available in Singapore.
GIC does not disclose the size of its fund or detail its investments. It says on its website that it manages "well over" $100 billion in over 40 countries but most analysts estimate the fund's assets are between $200 billion and $300 billion.
GIC's key investments include a substantial stake in Citigroup , which it helped rescue in the aftermath of the financial crisis. According to Reuters data, it is the biggest shareholder in the U.S. bank with a 3.86 percent stake.
According to GIC's last annual report issued in September, the United States accounts for 36 percent of its investments, the highest of any country.
Tan said the U.S. economy was showing signs of recovery following the government's stimulus package, the Fed's second round of quantitative easing and increased bank lending.
"Economists are becoming more confident that a self-sustaining recovery in consumer and business spending is beginning to take hold in the United States," he said.
"This year, U.S. growth may reach 4 percent, a substantial improvement over what was expected even two months ago."
However, unemployment, housing sector weakness and the prospect of high inflation remain risks, Tan said. In addition, the ouster of Egyptian President Hosni Mubarak and unrest across the Arab world had escalated geopolitical and global policy risk, he said. (Reporting by Raju Gopalakrishnan; Editing by Vinu Pilakkott)
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