RDIF to set up joint fund to implement BRICS infrastructure projects

Private Equity Wire, 16.07.2014

Kirill Dmitriev, chief executive of the Russian Direct Investment Fund (RDIF), is launching an initiative to form a joint fund to invest in the equity capital of BRICS infrastructure projects.

Dmitriev made the announcement at the BRICS summit in Fortaleza. Representatives of leading financial institutions, BRICS sovereign wealth funds and RDIF's international partners have given their support to the initiative.

Should the negotiations be successful, the joint fund will become operational by the next BRICS summit which is scheduled to take place in Ufa (Russia) in 2015.

Since its inception in 2011, the RDIF has raised in excess of USD12 billion in foreign capital by building long-term strategic partnerships with leading sovereign funds and state financial institutions of China, Japan, Korea, Qatar, Kuwait, the UAE, Bahrain, Italy and France.

Dmitriev led the B20 Taskforce on Investments and Infrastructure as part of Russia's G20 Presidency. The Taskforce worked closely with a range of partners, including major investment banks, sovereign funds, pension funds, leading global companies, international financial institutions and corporate consultants, to develop a package of proposals to encourage investment and create new jobs. The recommendations formed part of the White Book presented to the Group of Twenty heads of state during the 2013 G20 St Petersburg summit.

Dmitriev says: “Every BRICS nation has huge potential to develop infrastructure projects, as well as a great need to attract large volumes of equity financing from foreign investors. The establishment of such a fund would do much to address the challenge of insufficient financing for infrastructure projects in BRICS countries, which each present a huge opportunity and experience similar issues in the delivery of infrastructure projects. The exchange of best practice and expertise will enable us to structure infrastructure projects on both a national and international scale in a way that makes them equally appealing to leading sovereign wealth funds, institutional investors and private investors. Indeed, many such investors have already voiced their support for the idea of establishing a new BRICS infrastructure fund.”