The skyrocketing of the price of crude oil makes the Middle East countries' forex earnings increase fast. Most of these countries have established their sovereign wealth fund, as a way to increase the earnings of their forex deposit.
For example, sovereign wealth fund of the United Arab Emirates totally amounts to US$900 billion. However, this record will be broken soon. The Kingdom of Saudi Arabia, who oringinally set up the sovereign wealth fund, has decided to establish a new one of an even larger scale. Kuwait is not a big country, whereas its sovereign wealth fund amounts to US$300 billion, which put it on the list of the ten biggest sovereign wealth fund countries.
Sovereign wealth fund is mainly used to invest in the internatinal market. The Kingdom of Saudi Arabia, United Arab Emirates, and Egypt all have many overseas programes. Except the international market, the sovereign wealth fund of the United Arab Emirates has been used to the investment of public utilities , and energy exploration by the international corporations.
In addition, Arab countries sovereign wealth fund has been popular in Africa, Europe and Asia, and has good influence. An economist from Egypt said Abian countries sovereign wealth fund has not only played a key role in theirselves economy and social construction, but also will change the global investment structure, promote the global economic growth. The sovereign wealth fund has become a new force in the global capital market.
The economist from egypt said that the skyrocketing oil price, the rise of forex reserves, the performance of the the sovereign wealth fund are the main factors causing the increase of the Arabian countries' sovereign wealth fund.
However, some westerners, including political leaders, are in opposition to the sovereign wealth fund. They deam that it lacks transparency, and there exist black case work, and it is used for political ends. This made the Arabiancountries puzzled.
By People's Daily Online
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