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Is the Erecting of Barriers against Sovereign Wealth Funds Compatible with International Investment Law?

Is the Erecting of Barriers against... I. INTRODUCTION In the 1990's, no one could have foreseen that state-owned companies would become major players of globalization. Following the fall of the Berlin wall, their presence in international business transactions had been steadily decreasing. However, this trend has changed since the beginning of the Second Millennium. Since then, some states are again playing a role in the international economy. However, unlike during the Cold War era, these are not socialist states engaged in international trade with Western companies. Instead, we are seeing a genuine form of state capitalism by which some of them are using specific investment vehicles to invest assets in North American and European markets. Sovereign Wealth Funds (SWFS) represent this not-so-new trend of states involved in globalization. Historically, the first SwFs are supposed to be the Kuwait Investment Authority and the Kiribati Revenue Equalisation Reserve Fund, which started in the 1950's. But it is clear that the major impact of SWFS on global economy is much more recent. Firstly, twenty new SWFs have been established since 2000, including twelve since 2005. Amongst the recent SWF owners are some major countries like Russia and China, whose geopolitical interests are much greater than those of http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of World Investment and Trade Brill

Is the Erecting of Barriers against Sovereign Wealth Funds Compatible with International Investment Law?

Journal of World Investment and Trade , Volume 10 (4): 11 – Jan 1, 2009

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Publisher
Brill
Copyright
Copyright © Koninklijke Brill NV, Leiden, The Netherlands
ISSN
1660-7112
eISSN
2211-9000
DOI
10.1163/221190009X00330
Publisher site
See Article on Publisher Site

Abstract

I. INTRODUCTION In the 1990's, no one could have foreseen that state-owned companies would become major players of globalization. Following the fall of the Berlin wall, their presence in international business transactions had been steadily decreasing. However, this trend has changed since the beginning of the Second Millennium. Since then, some states are again playing a role in the international economy. However, unlike during the Cold War era, these are not socialist states engaged in international trade with Western companies. Instead, we are seeing a genuine form of state capitalism by which some of them are using specific investment vehicles to invest assets in North American and European markets. Sovereign Wealth Funds (SWFS) represent this not-so-new trend of states involved in globalization. Historically, the first SwFs are supposed to be the Kuwait Investment Authority and the Kiribati Revenue Equalisation Reserve Fund, which started in the 1950's. But it is clear that the major impact of SWFS on global economy is much more recent. Firstly, twenty new SWFs have been established since 2000, including twelve since 2005. Amongst the recent SWF owners are some major countries like Russia and China, whose geopolitical interests are much greater than those of

Journal

Journal of World Investment and TradeBrill

Published: Jan 1, 2009

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