{
  "title": "IMF Survey: Wealth Funds Group Publishes 24-Point Voluntary Principles",
  "publication": "IMF News, October 15, 2008",
  "sourceUrl": "https://www.imf.org/en/news/articles/2015/09/28/04/53/sonew101508b",
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  "summary": "The International Working Group of Sovereign Wealth Funds (IWG) publishes a set of 24 voluntary principles designed to ensure an open international investment environment.",
  "authors": [
    "Simon Willson IMF Survey"
  ],
  "publishDate": "2008-10-15",
  "sections": [
    {
      "heading": "Santiago Principles and purpose",
      "content": "- The International Working Group of Sovereign Wealth Funds (IWG) published a set of 24 voluntary principles (the Santiago Principles) designed to ensure an open international investment environment.\n- Purpose of the Santiago Principles (IWG statement):\n  - Establish a transparent and sound governance structure that provides for adequate operational controls, risk management and accountability\n  - Ensure compliance with applicable regulatory and disclosure requirements in the countries in which SWFs invest\n  - Ensure SWFs invest on the basis of economic and financial risk and return-related considerations\n  - Help maintain a stable global financial system and free flow of capital and investment\n- The Santiago Principles specifically commit wealth funds to make a series of public disclosures while aiming to avoid placing SWFs at a competitive disadvantage in the marketplace."
    },
    {
      "heading": "Definition, origins, and growth of SWFs",
      "content": "- SWFs are defined as special purpose investment funds or arrangements, owned by the general government, created by the general government for macroeconomic purposes; they hold, manage, or administer assets to achieve financial objectives and employ investment strategies including investing in foreign financial assets.\n- Common sources for SWFs: balance of payments surpluses, official foreign currency operations, proceeds of privatizations, fiscal surpluses, and/or receipts from commodity exports.\n- Historical and projected asset size:\n  - SWFs have operated at least since the 1950s.\n  - Market estimates suggest assets may rise further from $2-3 trillion today to about $6-10 trillion within five years.\n- Countries with the world's largest SWFs at present include China, Kuwait, Norway, Russia, Singapore, and the United Arab Emirates.\n- SWFs also exist in several middle-income countries, including Botswana and Trinidad and Tobago."
    },
    {
      "heading": "IWG composition, governance, and next steps",
      "content": "- IWG membership (member countries):\n  - Australia, Azerbaijan, Bahrain, Botswana, Canada, Chile, China, Equatorial Guinea, Iran, Ireland, South Korea, Kuwait, Libya, Mexico, New Zealand, Norway, Qatar, Russia, Singapore, Timor-Leste, Trinidad and Tobago, United Arab Emirates, United States\n- IWG permanent observers:\n  - Oman, Saudi Arabia, Vietnam, Organization for Economic Cooperation and Development, World Bank\n- IWG co-chairs and facilitation:\n  - Co-chaired by Hamad Al Suwaidi (Undersecretary of Abu Dhabi's Finance Department) and Jaime Caruana (Director of the IMF's Monetary and Capital Markets Department).\n  - IMF staff facilitated and coordinated the work and provided technical support to the IWG.\n- Work on a permanent international sovereign wealth funds body:\n  - Consideration of a permanent body to represent SWFs would commence in early 2009.\n  - Potential roles: help SWFs build capacity, work together, adapt the Santiago Principles as necessary, and conduct outreach to improve global understanding of SWFs."
    },
    {
      "heading": "Policy messages, international reception, and context",
      "content": "- Free flow of capital and investment:\n  - IWG co-Chair Hamad al Suwaidi: implementation of the Santiago Principles seeks to ensure the international investment environment will remain open.\n  - The Principles include expectations that recipient countries will not subject SWFs to discriminatory measures to which other foreign or domestic investors in similar circumstances are not subjected.\n- International endorsements and dialogue:\n  - OECD Secretary General Angel Gurría: OECD provided inputs and observed the IWG work; OECD guidance to recipient countries combined with the Santiago Principles provides a robust framework to promote mutual trust and confidence.\n  - Joaquin Almunia, European Commissioner for Economic and Monetary Affairs: Santiago Principles amount to a global public good needed in \"these turbulent times\" to enhance mutual trust and preserve an open investment environment.\n- Role during global financial crisis:\n  - Jaime Caruana: SWFs' long-term horizons can contribute to financial stability; the Santiago Principles are more important because of the global financial crisis.\n  - David Murray (IWG drafting Chair): development and publication of the Santiago Principles was \"all about trust\"; convincing the world of commitment to openness was a core task.\n\nIMF Survey online — October 15, 2008\n\n---\n\n Content in this bundle\n\n- 022908pdf (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\n References\n\n- https://www.imf.org/en/News/country-focus\n- PRESS CENTER\n- In The News\n- Pact on voluntary principles\n- IMF work on wealth funds\n- IMF Board on wealth funds\n- Norway's model wealth fund\n- Rise of sovereign funds\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2015/09/28/04/53/sonew101508b"
    }
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    "Authors: Simon Willson IMF Survey",
    "Published: October 15, 2008",
    "The International Working Group of Sovereign Wealth Funds (IWG) published a set of 24 voluntary principles (the Santiago Principles) designed to ensure an open international investment environment.",
    "Purpose of the Santiago Principles (IWG statement):",
    "The Santiago Principles specifically commit wealth funds to make a series of public disclosures while aiming to avoid placing SWFs at a competitive disadvantage in the marketplace.",
    "SWFs are defined as special purpose investment funds or arrangements, owned by the general government, created by the general government for macroeconomic purposes; they hold, manage, or administer assets to achieve financial objectives and employ investment strategies including investing in foreign financial assets.",
    "Common sources for SWFs: balance of payments surpluses, official foreign currency operations, proceeds of privatizations, fiscal surpluses, and/or receipts from commodity exports.",
    "Historical and projected asset size:",
    "Countries with the world's largest SWFs at present include China, Kuwait, Norway, Russia, Singapore, and the United Arab Emirates.",
    "SWFs also exist in several middle-income countries, including Botswana and Trinidad and Tobago.",
    "IWG membership (member countries):",
    "IWG permanent observers:",
    "IWG co-chairs and facilitation:",
    "Work on a permanent international sovereign wealth funds body:",
    "Free flow of capital and investment:",
    "International endorsements and dialogue:",
    "Role during global financial crisis:",
    "[022908pdf (PDF)](/-/media/websites/imf/imported/external/np/pp/eng/2008/_022908pdf.pdf){rel=\"external\" type=\"application/pdf\"}",
    "[https://www.imf.org/en/News/country-focus](https://www.imf.org/en/News/country-focus)",
    "[PRESS CENTER](http://presscenter.imf.org/)",
    "[In The News](https://www.imf.org/en/news/search)",
    "[Pact on voluntary principles](https://www.imf.org/external/pubs/ft/survey/so/2008/NEW090308B.htm)",
    "[IMF work on wealth funds](https://www.imf.org/external/pubs/ft/survey/so/2008/POL03408A.htm)",
    "[IMF Board on wealth funds](https://www.imf.org/external/pubs/ft/survey/so/2008/NEW032108A.htm)",
    "[Norway's model wealth fund](https://www.imf.org/external/pubs/ft/survey/so/2008/POL070908A.htm)",
    "[Rise of sovereign funds](https://www.imf.org/external/pubs/ft/fandd/2007/09/straight.htm)",
    "[https://www.imf.org/en/home](https://www.imf.org/en/home)"
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