Bangkok: The Government Pension Fund (GPF) will deliver a 5.18% return to its members in 2025, aiding them in reaching their retirement objectives.
According to Thai News Agency, the GPF has announced this return rate amid ongoing legal adjustments and its offer to manage funds for government agencies. The fund has noted a growing interest from civil servants in gold investments and plans to enhance savings and investment options for members by 2026.
Mr. Songpol Cheevapanyaroj, Secretary-General of the GPF, highlighted that various volatility factors, including global economic uncertainty and geopolitical risks, have led the GPF to revise its investment strategy. Moving away from a binary classification of asset classes, the fund now employs a proactive and defensive asset grouping approach to boost investment management flexibility and efficiency. This strategic shift is expected to yield a 5.18% return for civil servant member funds in 2025, compared to a 3.91% return in 2024.
Investment returns have generally improved, with the gold plan achieving the highest return at 52.78%. Other notable returns include the foreign equity plan at 17.47%, Thai real estate fund plan at 9.38%, actively managed plan at 8.89%, age-balanced plan (for members under 55) at 8.74%, and the general basic investment plan at 4.31%. This diversification strategy has boosted potential returns for members, with significant interest shown in gold, bonds, foreign equities, and Thai equities.
The GPF is focused on enhancing the long-term quality of life for its members. By 2025, the fund aims to increase the proportion of members likely to achieve a sufficient retirement lump sum from 18% in 2024 to 25%. The GPF recognizes the demand for gold investment during times of high prices and underscores its role as a risk hedge.
Looking ahead to 2026, the GPF will explore new investment opportunities through initiatives like the Senior Housing Sandbox and investments in the aging economy. It will encourage continuous savings and age-appropriate investment plans. The GPF aims to develop strategies for long-term returns, targeting a performance that surpasses the 10-year average inflation rate by 2-3%.
The fund is also considering legal amendments to manage other government agencies' funds, such as the Social Security Office. Currently, only 1.2 million of the 3 million civil servants are GPF members, and many agencies have expressed interest in GPF's fund management capabilities.
Mr. Songpol announced his resignation to become Director of the Government Savings Bank, assuring that the GPF's management will remain unaffected due to a pre-established 5-year plan. The GPF's capable executives are expected to maintain effective management of member returns.