The CEO of Djibouti’s sovereign wealth fund says the fund wants to double its holdings in ten years

In order to assist the government’s ambitions for economic development, the chief executive of Djibouti’s sovereign wealth fund stated that the fund intends to engage in high-yield projects and increase its assets under administration to over $1 billion over the next ten years.

By establishing the Fonds Souverain de Djibouti (FSD) in 2020, the Horn of Africa nation aimed to adopt a strategy that has been effectively implemented by Asian and Gulf nations, such as Singapore and Qatar, to finance economic development and diversification while providing a safety net in times of crisis.

“If everything else stays the same, including dividends, etc., I think we can definitely double the size of the assets under management within the next ten years,” FSD CEO Slim Feriani told Reuters in an interview.

“The wealth fund owns a 40% stake in GHIH, the holding company for many of Djibouti’s maritime and logistical assets, including its port,” Feriani claimed, in addition to the national telecommunications monopoly Djibouti Telecom.

It also receives roughly $25 million annually in cash, which is 20% of the money the government makes from leasing bases to foreign armies.

With military installations for the US, China, Japan, and European countries like Italy and France, Djibouti is a strategically significant nation, according to Feriani.

At the southern gateway to the Red Sea, Djibouti is home to just over a million people, making it one of Africa’s smallest nations.

Global maritime transportation and its cutting-edge deepwater port, which also serves neighboring landlocked Ethiopia, a rapidly expanding market with a population of over 100 million, are major drivers of its economy.

With the help of logistics export revenue and re-exports to Ethiopia, the World Bank projects average economic growth of 5.4% in 2024–2026.

“We are a hub for ports and logistics, but we should be a hub for manufacturing industry for the rest of the region,” Feriani stated.

Feriani, a former minister in Tunisia and investment bank Nomura in London, stated that FSD has an investment pipeline worth over $50 million that includes data centers, renewable energy, and logistics in the nation, as well as a stake in a solar energy project in the Grand Bara area.

Without providing a timeline, Feriani stated that the fund would eventually also make investments in assets outside the nation.

“Our inspiration is Temasek,” he remarked, alluding to the state wealth fund of Singapore.