The State Oil Fund of the Republic of Azerbaijan (SOFAZ) is shifting its investment strategy to focus on digital infrastructure and renewable energy projects. Israfil Mammadov, Executive Director of SOFAZ, attended the Canada Investment Summit 2026 in Toronto this September to discuss potential joint investments with global institutional partners.
SOFAZ currently manages more than $72 billion in assets. According to the fund, its existing portfolio is composed of approximately 55 percent fixed-income securities, 20 percent equities, 10 percent real estate, and 10 to 12 percent gold. Officials indicated that the fund is seeking to diversify into infrastructure projects that offer target annual returns of 8 to 12 percent to better hedge against global inflation and monetary policy uncertainty.
During the summit, Mammadov met with representatives from Brookfield Asset Management, which oversees more than $1 trillion in assets. Discussions centered on the growing intersection of digital infrastructure and energy production. As artificial intelligence development drives a surge in electricity demand for data centers, the fund is evaluating opportunities to invest in renewable energy generation and power transmission networks.
SOFAZ also held meetings with other major institutional investors, including the Canada Pension Plan Investment Board, PSP Investments, the Canada Development Fund, and Japan’s Government Pension Investment Fund (GPIF). These engagements are intended to establish co-investment mechanisms, allowing SOFAZ to participate in large-scale projects with stakes ranging from 5 to 15 percent. This model is designed to share capital requirements and mitigate risks associated with major infrastructure developments.
The fund stated that transitioning toward an active investment model in the energy and digital sectors aims to ensure the long-term growth of its capital reserves. By allocating a portion of its portfolio to these sectors, SOFAZ intends to maintain returns that exceed inflation rates for future generations.
Article source: www.azernews.az | Image credit: www.azernews.az