CNN Money – Government-controlled investment funds from China, Saudi Arabia and other countries will face pressure this week from finance ministers of the world’s richest countries concerned abouttheir lack of transparency and potential to gain stakes in companies linked to national security.
The prodding is expected to begin Friday evening at an “outreach dinner” hosted by Treasury Secretary Henry Paulson, who invited representatives from eight nations with so-called sovereign wealth funds.
“We look forward to a constructive discussion,” Treasury Undersecretary David McCormick said in a statement. “We seek … to emphasize our joint commitment to maintain openness to investment andto promote financial stability.”
These foreign funds have been around since the 1970s but have gotten much bigger in the last few years. They control an estimated $2.5 trillion in assets and play an expanding role in the global economy. Some experts say the funds – whose holdings are projected to reach $12 trillion by 2015 – could be used as instruments of foreign policy by the countries controlling them.
