This contribution by CEME Research Affiliate Eliza Malathouni examines the nature of SWFs as both public and private bodies in an effort to more clearly delineate criteria that contribute to each characterization. From a procedural point of view, clarifying the nature of SWFs will determine the international courts and/or tribunals in which SWFs have standing. (April 2012)
In the past two decades, the use of bilateral investment treaties as vehicles to facilitate foreign direct investment has expanded significantly, creating an international investment framework so pervasive that it is now characterized as a "regime." This brief considers whether SWF investors can fit within the current investment regime from a jurisdictional perspective, what structural issues SWFs are likely to confront within that regime, the implications of SWF investment on the regime’s putatively "bilateral" structures, and how SWF investments are likely to be accommodated by the regime. The paper is an adaptation of the LLM thesis of David G. Fromm, Fletcher School of Law and Diplomacy, Tufts University 2011. (April 2012)
Much of the sovereign wealth fund debate has taken place in the international context, and understandably so. However, Jeremy Leong, Assistant Professor at Singapore Management University's School of Law, argues that pre-2008 concerns are no longer salient. Instead of focusing on the most effective way international and/or foreign regulations can discipline SWF investment activity, we need to take an inward analytical turn in the debate. Accordingly, it may be more useful for the debate to look at the domestic legal and structural constraints on SWFs. This article provides an analytical framework, which may be used to discuss domestic regulatory constraints on SWFs investments. (April 2012)
Sovereign wealth funds wield a staggering amount of financial influence. Given all the money at issue, U.S. prosecutors have expressed a clear concern about the risk of corruption in dealings with these funds. Indeed, both the U.S. Department of Justice and the U.S. Securities and Exchange Commission have indicated an interest in examining transactions involving sovereign wealth funds for possible violations of the U.S. Foreign Corrupt Practices Act (FCPA). This article, written by a team from K&L Gates LLP, addresses the potential liability that sovereign wealth funds face under three of the most significant antibribery laws: the U.S. FCPA, the U.K. Bribery Act, and the People’s Republic of China’s Antibribery Laws. (April 2012)
This article by K&L Gates LLP partners Fred M. Greguras and Michael J. O'Neil and associate Chenhao Zhu focuses on the legal and regulatory hurdles that Chinese companies face when investing in U.S. concerns. While it is not news that Chinese companies are stepping up investments in the U.S., recent developments have shown that at least some of these companies are receiving substantial support from the Chinese government in the form of commitments of foreign reserves. This is an outgrowth of China’s broader “going out” strategy announcing in July 2009 by Premier Wen Jiabao. Coupled with increased investment in clean technology, many Chinese companies can expect to run the gauntlet of the Exon-Florio review process. (April 2012)
In this edited transcript, SWFI co-heads Eliot Kalter and Patrick Schena discuss with Edwin M. Truman the proliferation of new sovereign wealth funds, current trends in investment decisions, and the future role of the IMF’s International Forum of Sovereign Wealth Funds. Dr. Truman is a noted voice among sovereign wealth fund watchers and scholars. His recent book, Sovereign Wealth Funds: Threat or Salvation? (Peterson Institute, 2010), explores the origins of SWFs and the buildup of international reserves, and unveils a “scoreboard” that ranks funds in 33 variables across four categories: structure, governance, transparency, and accountability. (March 2012)
Nigeria officially joined the global SWF fraternity in May 2011 when Nigeria’s President Goodluck Jonathan signed into law the Nigeria Sovereign Investment Authority Act of 2011. The Act establishes the Nigeria Sovereign Investment Authority as a vehicle for the actualization of Nigeria’s SWF aspirations to preserve savings of the Nigerian people, develop domestic infrastructure, and provide stabilization support in times of economic stress. In this paper, Fletcher alumnus John Ezeani analyses the "ring-fenced" structure of the fund, fund allocation and future sources, and the legal challenge the SWF posed. (March 2012)
Shuvam Dutta, CEME Research Assistant, examines the theoretical underpinnings that have guided the investment philosophy of sovereign wealth, compares how investment mandates have informed actual asset allocation decisions, and offers commentary on some special circumstances posed by funds established in the last ten years. (March 2012)
This analysis authored by SWFI co-head Patrick Schena examines the China Investment Corporation and the process of responding to changing global circumstances over its four years of operation. The article reviews CIC’s capital structure, identifies governance challenges stemming from its evolving relationship with China’s State Administration for Foreign Exchange, and an analysis of key issues which impact the optimization of the management of China’s foreign reserves. (March 2012)
In this working draft, SWFI Affiliates Asim Ali and Shatha Al-Aswad argue that “neighborly investment” by the Persian Gulf states and their SWFs would be a positive step towards their diversification and development objectives. (March 2012)
SWFI co-head Eliot Kalter delivered this presentation at the CFA Institute conference in March 2012. The slides cover the diversification of SWF asset allocation and political risk.
SWFI Affiliates Asim Ali and Shatha Al-Aswad analyze the competitive branding between Bahrain, Qatar, and UAE, from oil, finance, real estate, and automotive to entertainment. As Gulf SWFs pour money into the region, these countries have now turned towards promoting themselves as financial hubs of the regions. Will all succeed or must there be consolidation? (February 2012)
Dr.
David Glancy, SWFI Affiliate and Assistant Professor (contractor – Booz Allen Hamilton) with the War and Conflict Studies Department at the College of International Security Affairs (CISA) at National Defense University, examines the unique position of Sovereign Wealth Funds when it comes to political risk issues. (February 2012)
Dr. Eliot Kalter, senior fellow and co-head of The Fletcher School’s Sovereign Wealth Fund Initiative and president of EM Strategies, explores how SWFs are subjected to political risk both domestically and externally. (February 2012)
Elijah Reese, Research Assistant for the Sovereign Wealth Fund Initiative, contributed this thought piece on the role of sovereign wealth funds in contributing to social and economic development amidst civil unrest.
Patty Ye Cao, Research Assistant for the Sovereign Wealth Fund Initiative, contributed this thought piece on the questions surrounding the Libyan Investment Authority.
Luke Cadigan, a partner in the Government Enforcement Practice Group in K&L Gates' Boston office, and Laura Prieston, an associate in the Litigation Group in Boston, reflect on Libya's assets as restrictions and sactions ease post Gadhafi.
SWFI Senior Fellow Thomas Holt joins colleagues at K&L Gates, LLP, in this assessment of proposed tax regulations that would make it easier for foreign governments, their instrumentalities and controlled entities – including sovereign wealth funds – to invest in U.S. private funds without losing the U.S. tax exemption.
SWFI Senior Fellow Patrick Schena and Fletcher Master of International Business candidate Ravi Shankar Chaturvedi examine whether sovereign wealth funds promote the development of capital markets.
In this piece published by Islamic Finance news, K&L Gates Finance Partner Jonathan Lawrence looks at the benefits and disadvantages of the fund as an Islamic entity.
SWFI Senior Fellow Patrick Schena, Fletcher School professor Jonathan Brookfield, and Fletcher MIB candidate Ravi Shankar Chaturvedi contributed this piece to the Monitor Group's 2011 report on sovereign wealth funds.
In this presentation, CEME Senior Fellow Dr. Eliot Kalter explains the relevance of SWFs, outlines the key attributes of CEME’s Sovereign Wealth Fund Initiative, and explores in depth the issues of asset allocation diversification, socio-political risk, response to recipient country discriminatory practices, and context-appropriate transparency and accountability standards for SWFs.
Dr. Eliot Kalter, senior fellow at The Fletcher School’s Sovereign Wealth Fund Initiative and president of EM Strategies, along with Thomas F. Holt, adjunct professor of law at The Fletcher School and partner in the global law firm K&L Gates LLP, write for Reuters on the “Euro zone crisis and sovereign wealth funds.” (June 2010)
This report, a product of CEME’s Sovereign Wealth Fund Initiative (SWFI), is based on discussions with SWF senior decision makers and country authorities from the Gulf Cooperation Countries, Latin America, Singapore, and several industrial countries. From these discussions, SWFI researchers identified and analyzed key international issues from the SWF point of view.
This note describes the role of the CEME’s Sovereign Wealth Fund Initiative (SWFI) in the context of the International Forum and the Santiago Principles from which both take their roots. SWFI provides senior decision-makers with a value-neutral venue and world-class resources to identify key international issues and approaches for better management of external relationships.