Revenue Equalization Reserve Fund
Encyclopedia
The Revenue Equalization Reserve Fund (RERF) is the sovereign wealth fund
of the Pacific island republic of Kiribati
.
The RERF was created in 1956 to act as a store of wealth for the country's earnings from phosphate
mining, which at one time accounted for 50% of government revenue.
In 2009 the RERF was valued at A$570.5 million. The RERF assets declined from A$637 million (420 percent of GDP) in 2007 to A$570.5 million (350 percent of GDP) in 2009. As the result of the Global Financial Crisis (GFC) the RERF was exposure to failed Icelandic banks, as well drawdowns were made by the government of Kiribati to finance budgetary shortfalls.
Sovereign wealth fund
A sovereign wealth fund is a state-owned investment fund composed of financial assets such as stocks, bonds, property, precious metals or other financial instruments. Sovereign wealth funds invest globally. Some of them have grabbed attention making bad investments in several Wall Street financial...
of the Pacific island republic of Kiribati
Kiribati
Kiribati , officially the Republic of Kiribati, is an island nation located in the central tropical Pacific Ocean. The permanent population exceeds just over 100,000 , and is composed of 32 atolls and one raised coral island, dispersed over 3.5 million square kilometres, straddling the...
.
The RERF was created in 1956 to act as a store of wealth for the country's earnings from phosphate
Phosphate
A phosphate, an inorganic chemical, is a salt of phosphoric acid. In organic chemistry, a phosphate, or organophosphate, is an ester of phosphoric acid. Organic phosphates are important in biochemistry and biogeochemistry or ecology. Inorganic phosphates are mined to obtain phosphorus for use in...
mining, which at one time accounted for 50% of government revenue.
In 2009 the RERF was valued at A$570.5 million. The RERF assets declined from A$637 million (420 percent of GDP) in 2007 to A$570.5 million (350 percent of GDP) in 2009. As the result of the Global Financial Crisis (GFC) the RERF was exposure to failed Icelandic banks, as well drawdowns were made by the government of Kiribati to finance budgetary shortfalls.