JapanÆs pension funds have grown their assets by 17% in the year 2005, the fastest-growing pension funds in the world after Mexico.

Watson Wyatt says the worldÆs largest pension funds grew by 12%, adding nearly $1 trillion, to reach $9.4 trillion. ItÆs clear that in Asia Pacific, Japan remains by far home to the biggest asset pools.

JapanÆs global market share in pension assets has actually fallen, though, as pension assets ballooned in the United States, South Korea, Canada and Norway. Japan now accounts for 17.6% of the global pensions market, versus 21% in 2004, but still well above 13.5% in 2003. Japanese corporate pensions have also been shedding some liabilities, although the daiko henjo process of returning liabilities to the state would not affect the data, as those assets would go to the public Pension Fund Association.

JapanÆs Government Pension Investment Fund remains the worldÆs biggest pension fund, with $870 billion of assets, followed by NorwayÆs Government Pension (formerly its oil reserve) at $236 billion, the NetherlandÆs ABP ($227 billion), KoreaÆs National Pension Corporation ($214 billion) and the California Public Employees Retirement Scheme ($196 billion).

JapanÆs PFA came sixth at $183 billion, while the Local Government Officials Pension Fund Association (Chikyoren) came in eighth, with $137 billion. JapanÆs Public Schools Employees Pension Fund ranked 19th with $85 billion.

Watson Wyatt says one difference between Asia and the rest of the world is that, while in America and Europe the very biggest funds are no longer the fastest growing, growth in Asia remains concentrated among the biggest state-sponsored entities.

The data is based on rankings jointly compiled out of London by Watson Wyatt and Pensions & Investments, but the long distance shows: the top-20 ranking confusingly includes Taiwan Post, which is indeed a large institution ($117 billion) but not a pension fund. This is why you read AsianInvestor magazine. Our ranking of the regionÆs top 200 institutional investors will be out in May, 2007.