CASTRIES, ST. Lucia – The St. Lucia government Monday said it has approved the creation of the Sovereign Wealth Fund, describing the move as a “forward-thinking public investment fund designed not only to secure sustainable economic development but also to bolster our climate resilience”.
Prime Minister Phillip J PierreIn a statement, the Phillip J Pierre administration said that the key characteristics of the fund will be to support investments in climate adaptation and mitigation in addition to sustainable economic development as well as e a public fund managed by a board, which shall be a corporate body.
It said that the board shall devise investment guidelines that bind the performance of the investment manager, and that these guidelines should prioritize the following principles, namey a ‘high’ return target be the primary motivator prior to the attainment of set thresholds as well as thresholds to trigger non-investment withdrawals be defined, with these triggers being tied to portfolio size relative to gross domestic product (GDP).
In addition, the board shall ensure that the fund be invested according to the Environmental, Social, and Governance (ESG) principles and that derivatives and similar instruments be used only for hedging purposes as well as the resources of the fund shall consist of such funds as may be allocated by the Minister to the fund on its commencement.
“As the government of St. Lucia establishes this vehicle for national development, it’s crucial to recognize the transformative power of savings. The Sovereign Wealth Fund of St. Lucia sets an example for St. Lucians to develop a habit of saving and investing in the future,” the statement said.
