By Ukumbi Afrika Sovereign wealth funds and central banks managing an estimated US$29 trillion are increasing investments in energy infrastructure and real assets while reassessing their exposure to the U.S. dollar, reflecting a changing global investment landscape shaped by geopolitical uncertainty and economic fragmentation.
The world’s largest sovereign investors are rebalancing their portfolios in response to mounting geopolitical and economic risks, with energy infrastructure emerging as one of the most attractive long-term investment themes.
According to a new survey by global investment manager Invesco, sovereign wealth funds and central banks overseeing approximately US$29 trillion in assets are placing greater emphasis on resilience, diversification and investments capable of withstanding prolonged periods of market uncertainty.
The survey, which gathered responses from 90 sovereign wealth funds and 54 central banks, found that 80% of participants consider investments in energy security and energy transition infrastructure among the most effective ways to strengthen portfolio resilience.
Infrastructure investments continue to gain prominence, accounting for approximately 9% of sovereign wealth fund assets in 2026, while growing demand for artificial intelligence (AI) infrastructure is further increasing the attractiveness of long-term energy investments.
Benjamin Jones, Head of Research at Invesco, said investors are fundamentally reassessing traditional portfolio construction in response to persistent inflation, geopolitical fragmentation and increasingly concentrated financial markets.
“In a world of inflation shocks, geopolitical fragmentation and more concentrated markets, investors are rethinking old assumptions about diversification and redesigning portfolios to withstand a wider range of outcomes,” Jones said. “Resilience is becoming a hard requirement, not a nice-to-have.”
Dollar Faces Growing Scrutiny
The survey also points to mounting concerns over the long-term role of the U.S. dollar as the world’s principal reserve currency.
Approximately 61% of central banks surveyed said rising U.S. debt levels pose a long-term risk to the dollar’s status as a reserve asset, compared with just 20% who held that view in 2024.
Nearly 29% of respondents expect the dollar’s reserve currency status to diminish within the next five years—more than double the proportion recorded in 2022.
Several central banks also reported reviewing their reliance on U.S.-based custodians, counterparties and financial market infrastructure as geopolitical tensions reshape global financial relationships. Some institutions have already diversified their custodial arrangements beyond the United States, while others are preparing contingency plans to reduce operational concentration risks.
Gold Regains Strategic Importance
The search for portfolio resilience is also driving renewed interest in precious metals.
Around one-third of respondents indicated plans to increase their gold holdings as part of broader diversification strategies, reinforcing the metal’s traditional role as a store of value during periods of geopolitical and financial uncertainty.
The survey suggests that sovereign investors are increasingly favouring real assets—including energy infrastructure, logistics and strategic commodities—as they seek to navigate a more fragmented and unpredictable global economy.
Why It Matters
The investment priorities of sovereign wealth funds and central banks often signal emerging global capital trends. Growing allocations to energy infrastructure, critical assets and gold could influence investment flows into sectors that are increasingly important to Africa, including renewable energy, critical minerals, transport infrastructure and digital connectivity. At the same time, continued debate over the future role of the U.S. dollar highlights the broader restructuring of the international financial system that African policymakers, central banks and institutional investors will need to navigate.
Source: Reuters
Reporting: Libby George.
Editing:Dhara Ranasinghe and Tomasz Janowski.