The Qatar Investment Authority has announced that it has created a new investment fund, PME Infrastructure Management Limited Fund, to invest in African transportation, communication and energy sectors. This fund was announced on the eve of a trip by South African President Thabo Mbeki to Qatar. This fund will have $400 million and be listed on the London Securities Market. This is considered to be the first investment by the QIA in South Africa. According to the Government of Qatar, the fund gives priority to investments in South Africa, as it is the most suitable country to invest in compared to other African countries. This investment follows the trend by the QIA to create investment funds that focus on specific countries or regions, including its most recent fund focusing on Vietnam.

My first thought is that this fund is probably going to start a trend of Sovereign Wealth Funds investing in Africa. Sovereign Wealth Funds are always looking at each other to see what other SWFs are doing and for the most part, they try to do the same (for more details on investments, see Investments in the Financial Sector). Our recent report on SWF investments in Africa found only a few so far but we noted that SWFs will be increasing their investments starting this year. There are heavy rumors out there that some SWFs are targeting several African companies including financial banks. So I wouldn't be surprised if Abu Dhabi Investment Authority, Temasek Holding , Government of Singapore Investment Corporation, and Qatar Investment Authority start making more investments in Africa within the next few months. I can easily see that investments in Africa will top $5 billion during this year and possibly go over $10 billion.