Korea investment corporation: its origin and evolution

초록

This paper provides a detailed account of the creation and the evolution of Korea Investment Corporation (KIC) - a sovereign wealth fund (SWF) established in 2005 by the Korean government. It highlights three features of KIC. First, the case of KIC effectively shows the problem of having an unclear mission statement, which allows the mission to evolve over time and multiple missions to coexist, which may contradict each other. Second, it effectively reveals the typical conflicts that may arise between the central bank and the ministry involved when setting up a reserve-based SWF. Third, it effectively shows how an SWF can be operated in a way that favors the bureaucrats and the politicians.

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