Singapore’s GIC investments rakes in 9.5% annual returns

The Government of Singapore Investment Corporation (GIC) disclosed yesterday that its portfolio of investments have yielded an average annual 9.5 percent, in US dollar terms, for the past 25 years to March this year.

Lee Kuan Yew, GIC’s chairman, said in a speech delivered on Tuesday, 11 July that the rate of return was made from nine asset classes including private equity.

Ng Kok Song, managing director for public markets at GIC, said it was planning to raise its exposure to private equity and hedge funds, according to a number of reports. He said in addition to emerging markets, they have been among the best performing asset classes for GIC.

There is no detail on how much GIC is investing, or how much more it plans to invest in private equity.

Established in 1981, GIC is a government investment vehicle that manages well over $100 billion of Singapore financial reserves, a jump from assets worth S$6.4 billion under management in 1981.

GIC Special Investment has been a keen in acquiring European infrastructure. It is in the consortium led by Goldman Sachs that is acquiring UK’s Associated British Port Holdings for £2.5 billion, and a member of Spanish-led consortium that last month agreed to buy BAA, owner of London’s Heathrow Airport for £10.1 billion.

GIC expects to make more investments in emerging markets in Asia, Europe and the Middle East. China, India, South Korea and Taiwan were identified as areas GIC plans to inject more funds into.

Calls to GIC were not returned.