Kuwait Names Al-Ghunaiman to Head $700 Billion Wealth

Kuwait completed an overdue management reshuffle and named Ghanem Al-Ghunaiman as the new managing director of its $700 billion sovereign wealth fund, according to a statement on state-run KUNA news agency on Thursday.

Al-Ghunaiman, an official with the Kuwait Fund for Arab Economic Development, replaces Farouk Bastaki, who helped to propel the Kuwait Investment Authority to rank among the world’s biggest wealth funds.

The KIA manages the Future Generations Fund, which is designed to reduce dependence on oil-related investments. It gained a record 33% during the last fiscal year ended March 31.

Kuwait appointed a new board to its $700 billion sovereign wealth fund after a delay of more than three months due to disagreement over the make up the nine-member body.

The formation of a new management team ends a period of limbo at the world’s third-largest sovereign wealth fund following the completion of the former board’s tenure on April 20. The conflict had complicated the Kuwait Investment Authority’s ability to make major decisions, even though the finance minister – as its chairman – can decide on important issues.

In his new role, Al-Ghunaiman takes on the much-scrutinized challenge of helping to ease the country’s liquidity crisis.

Energy-rich Kuwait has been forced to tap into the wealth fund to cover its budget deficit, in part because the cabinet and parliament haven’t been able to agree on a proposed law that would let the country cover the gap by borrowing in overseas markets.