Abu Dhabi Wealth Fund Sees U-Shaped Global Rebound Next Year - Bloomberg:
The global economy is likely to recover from this year’s virus-driven recession with 5% growth in 2021, according to Abu Dhabi’s $220 billion wealth fund.
The most likely outcome following the economic crisis sparked by the coronavirus is a U-shaped rebound, meaning there will be some stagnation before things get better, said Musabbeh Al Kaabi, chief executive officer of the Petroleum & Petrochemicals division of Mubadala Investment Co. The fund -- with holdings across healthcare, technology, aerospace and energy -- gives that scenario a 70% probability and sees a 30% chance of a longer economic slump, Al Kaabi said.
As the pandemic forced factories all over the world to shutter and people to stay home, the global economy has plummeted and oil prices have dropped by almost half since the start of the year. Though they’ve risen in the past month as activity resumes in nations such as China, demand for crude is likely to peak within 10 years at most with the growing adoption of cleaner energy, Al Kaabi said.
“We are not in a state of denial, we understand the energy transition,” Al Kaabi said Wednesday, in a virtual energy forum hosted by the Atlantic Council, a Washington-based think tank. Energy markets will see stronger demand for natural gas and Mubadala is skewing its investments in that direction, he said.
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