Compared to the sovereign wealth funds in North America, Asia and the Middle East, the SWFs in South America are lesser in asset size.
Topping the list, the Social and Economic Stabilization Fund (SESF) of Chile, started since 2007, manages close to US$15 billion in assets. Copper exports stands for more than one third of the Chilean government's income. Thus, the SESF acts as a stabilizer to the variability of global copper prices. Whenever the price of copper increased, the government would direct a proportion of the increased revenues into the SESF. However, when the price of copper fellow below its expected level, the fund will then be tapped to make up for the shortfall in government income due to the drop in copper prices.
The Pension Reserve Fund is another SWF of Chile. Started since 2006 with US$604.5 million, it has grown to close to US$9.4 billion in assets. The Pension Reserve Fund was was established to prepare for and support future government expenditures for Chile’s new demographic scenario of increased life expectancy and elderly population.
Check out the rest of the largest sovereign wealth funds (SWFs) by region:The Largest SWFs in Europe