As of June 2015, the system is composed of 65 financial entities with assets over 45% of GDP and a loan portfolio of 27% of GDP.3, 4 Most of the loans go to the commercial sector (58.7%), while the remainder is split between personal consumption loans (24%) and mortgage loans (17.3%).
By 2010, estimates the pension funds' regulator, the ratio of the funds' portfolios to GDP will double, and then double again by 2020.In this section Specialist help needed Shuffling the pack Safety first Clear for take-off Bulldozed McCurrencies ReprintsThere are good reasons why the Siefores' portfolios are skewed towards government debt.
A vulnerable economy was battered last year by the low price of oil, the country's main export, and the El Niño current, which caused damage equal to perhaps 12.5% of GDP (and wrecked banks' loan portfolios).Mr Mahuad is at least trying to push through reform.
For example, American pension funds, which hold assets worth about 107% of America's GDP, allocate just 31% of their portfolios to fixed income.
That rise of 14 percentage points implies an improvement in GDP of 5.6%.The evidence on whether portfolio investment affects growth is even more sparse than the evidence on FDI.
One of the most exposed is Turkey, which has low savings, a huge current-account deficit in the range of 6-8% of GDP and a high dependence on volatile inflows of portfolio capital.
An investor who tracks an index weighted by market value ends up with 29% of his portfolio in countries where the debt-to-GDP ratio is more than 120%, and only 1% in countries where the ratio is under 40%.
He found that, within the total of portfolio flows, equity flows have an even bigger positive effect on GDP than FDI, an admittedly strange result.
At the peak the mortgage portfolio was above €600bn or slightly below 60%% of Spain's annual GDP in 2007.
But portfolio outflows would dominate.Foreigners would buy Chinese securities worth a minimum of 2% of China's GDP and a maximum of 10%, the IMF authors estimate, adding greatly to China's foreign liabilities.
Yet it continues to issue bonds, with a gross debt of 34% of GDP, investing the proceeds in the so-called Petroleum Fund, which is allowed to hold up to 50% of its portfolio in domestic and foreign equities.
