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WORLD / Europe |
Russia says fears of Sovereign Wealth Funds unjustified(Xinhua)
Updated: 2008-01-24 20:32 Davos -- Fears of some western countries about rising Sovereign Wealth Funds (SWFs) are not justified, Russian Deputy Prime Minister Aleksey Kudrin said on Thursday, rejecting suggestions for restriction. "They (SWFs) play a very positive role on the global market. Any concern about the political underlining of these funds is exaggerated," Kudrin told a panel discussion on the role of the SWFs at the World Economic Forum. The funds, now estimated to be as large as US$2.5 trillion globally, are pools of money derived from a country's foreign reserves, which are set aside for investment purposes to benefit the country's economy and citizens. Currently 36 countries or regions have their SWFs, notably Russia and some Middle East countries, which accumulate huge foreign reserves from oil revenue. However, some Western countries led by the United States have been concerned about increasing involvement of those funds in their domestic economy, calling for more vigilant regulation to be introduced. Kudrin warned that some of the concerns and fears might create another problem by restricting the movement of capital. "This is the risk today that we face," he said, adding the SWFs are actually required and welcomed on the markets, which were hit by severe credit crunch in the aftermath of the US sub-prime mortgage market crisis. |
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