CEO of Kuwait Investment warns against exaggerated market growth

Bader Mohammad Al-Saad said current circumstances which led to the raise in assets will not align again

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Mr. Bader Mohammad Al-Saad, the Chief Executive Officer, Managing Director, and Director of Kuwait Investment Authority ,warned of trusting the growth of the capital and real estate markets, saying that, “It is difficult for this growth to continue because the actual circumstances aren’t likely to align again.”

Al-Saad expressed his concern over “the high level of cash in many markets in the U.S., Europe, Japan and some developing countries that have contributed to the abnormal raise in the values of assets.”

“This caused the Japanese stock market to grow by more than 50 percent last year and American stock market to grow by 27 percent, in addition to the growth of the European markets,” he said.

He described the optimism in the market as exaggerated and expressed his doubt that the current circumstances which led to the raise in assets will align again, especially considering that some interest rates have plummeted to zero in some countries.

Al-Saad said that this leads people to buy assets, be it in the form of stocks or real estate, which results in an abnormal price hike, which he says, doesn’t reflect the present world economic growth.

The Kuwait Investment Authority CEO doubted the genuine growth of the American stock market and says that “it is very difficult to continue at this pace.”

Discussing the future of the the Kuwait Investment Authority, Al-Saad told Al Arabiya's presenter Fatima Zahra Daoui that it will focus on increasing its investments in the infrastructure sector which guarantees direct cash income into developed countries such as the UK, U.S. and European Union countries. He added that they will also invest in international real estate, noting that it’s unlikely for the Authority to increase its investment in stocks.

Asked about the Kuwait market, Al-Saad said that national portfolio is there and the authority will keep on investing in the Kuwaiti Stock Market.