AFRICAN SOVEREIGN WEALTH FUNDS AND GOVERNMENT INFLUENCE: A CLOG IN THE WHEEL OF ECONOMIC DEVELOPMENT

Abstract

Sovereign Wealth Funds have in recent times gained unprecedented popularity largely because of the role it has come to play as the engine of economic development. In fact, every resource rich African country now wants to establish a SWF or some sort of fund to manage their surplus revenue. Although this appears to be bold and commendable step, it is imperative that caution should not be thrown to the wind in a bid to establish a wealth fund especially in countries with weak governance and institutions. Given that SWFs are creation of the government and some resource rich African countries have government that are at best opaque in their administration there are concerns how these funds will be accurately and prudently managed to benefit their economy and welfare of the citizen. This paper examines the role of African SWFs as the engine of development, the negative impacts of political interference in the management of some African SWFs, some African SWFs management skills. It finally concludes and provides some recommendations.