Developed countries are now demanding that the promoters (read: governments) of these funds clarify their practices and intentions, as the growing clout of Sovereign Wealth Funds (SWFs) through ownership of major companies in the developed nations has the potential to invite political and popular backlash.

Sovereign wealth funds are fast becoming the new masters of global finance. In what kind of assets and countries are they mostly investing?

Andrew K P Leung: The more successful high-saving export-oriented countries in the East have accumulated massive foreign currency reserves which are channeled into investments through their Sovereign Wealth Funds (SWF). According to a study by Morgan Stanley, such funds—most notably those from East Asia, Russia and other oil-exporting countries—have US$2.8 tn in assets and are multiplying their acquisitions. The largest of such funds are in the Middle East, thanks to the world's insatiable demand for oil and rapidly rising oil prices. The Abu Dhabi Investment Authority (ADIA), for example, has recently bought a 4.9% stake at US$7.5 bn in Citigroup, becoming its biggest single shareholder. The ADIA was reported to have bought an undisclosed stake in Sony. Dubai Sovereign Funds also snapped up shares in big names such as MGM Mirage casinos, aerospace giant EADS and the Barneys department stores. The Singapore Investment Corporation has also been very proactive. After acquiring a 12% stake (US$4 bn) to become the largest shareholder of Standard Chartered Bank, it has bought 9% (US$9.75 bn) of UBS, a record single investment by a SWF.

Sovereign Wealth Funds, SWFs, Global Finance, Foreign exchange reserves, Abu Dhabi Investment Authority, ADIA, Metro-Goldwyn-Mayer Inc, MGM, Standard Chartered Bank, ICICI Bank, China National Offshore Oil Corporation's , CNOOC, Committee on Foreign Investments in the US, CFIUS, Singapore Investment Corporation, SIC.