Tuvalu Trust Fund

The Tuvalu Trust Fund is an international sovereign wealth fund developed by Tuvalu, a small, central Pacific island nation, as a supplement to cover shortfalls in the national budget.

Establishment

In 1987, the Trust fund was established by international agreements between the government of Tuvalu and the international donors of Australia, New Zealand, and the United Kingdom. The initial amount ivested by the latter three nations amounted to AU$27.1 million.

Development of the Fund

The amount of the fund was, as stated previous, an amount of AU$27.1 million. Through successful investment abroad, this grew to AU$66 million in 2000. This amount was achieved with the help of other international donors of Japan and South Korea. The government of the Republic of Tuvalu has set an "informal target" of AU$100 million before it will stop reinvesting in the fund.

tructure

In order to avoid mismanagement and corruption that has plagued many other Pacific trust funds, the government established a management structure that includes:
* Board of Directors, with each appointed by an original donor
* Professional fund management
* International, external auditors
* Advisory committee (each original donor has a memeber on the committee)

Domestic uses

The fund was established for the intended purpose of helping to supplement national deficits, underpin economic development, and help the nation achieve greater financial autonomy.

Key element

One important element of the fund in order to avoid overdrawing to fund unauthorized projects, is the "separation of fund capital from fund proceeds available for distribution."

ee also

* Economy of Tuvalu
* Tuvalu
* Nauru Phosphate Royalties Trust

External links

* [http://hansard.millbanksystems.com/written_answers/1987/jun/30/tuvalu-trust-fund]
* [http://www.tpub.com/content/cg2001/d01808/d018080044.htm]
* [http://www.pacificmagazine.net/news/2007/05/25/tuvalu-trust-fund-pleased-with-performance]
* [http://books.google.com/books?id=iLiuZEYRfaEC&pg=PA40&lpg=PA40&dq=Tuvalu+Trust+Fund&source=web&ots=0jJ5LAonLI&sig=aLM700batQvTRxtFiEH7nH034wY&hl=en&sa=X&oi=book_result&resnum=4&ct=result]