Foreign Wealth Funds Defend U.S. Investments

"There are certain opportunities which do not come every day," he said. "We consider the recent crisis as creating some opportunities in certain sectors. I look at history, such as the savings-and-loan problem. It created golden opportunities."

But even as Saad mentions, without naming names, that some deals in the United States are in the works and may be announced soon, it's clear that he has moved on. "I think Vietnam is a coming star," he said. He is also looking at Turkey, which he predicted will be the hub for the Balkans region.

Another big interest of Saad's is Africa, with its seemingly infinite supplies of copper, iron, gold and other minerals. "I think Asia's growth will be history in the coming years and Africa will be next," he says. "I don't know how soon, but I think in two to three years."

Emotional Issues

But as sovereign wealth funds like Kuwait's expand their investments around the world, they are acutely aware that they must address the concerns of countries where their money goes.

Saad said the Kuwaiti fund's investments in any given region are roughly proportional to that region's share of worldwide production. There are exceptions, he said: Because of the recent acquisitions of financial firms, its holdings in the United States are significantly higher.

Saad said that all the stakeholders who need to know the inner workings of the fund -- the Kuwaiti parliament -- have all the information they need and that he does not expect any changes in what it discloses.

Officials of several other funds, however, said they were moving toward making changes to appease a public that isn't sure whether to be concerned about their expansion.

For example, Singapore's pioneering Temasek fund said in November that as a result of rising nationalism it would seek to work with local partners and back away from seeking controlling interests in overseas firms. Its chairman, S. Dhanabalan, said the $108 billion fund would take into account "emotional sentiments" when considering acquisitions.

Bahrain's Zain said his country's fund -- whose most prominent holding is a 30 percent stake in the Formula One auto racing company McLaren Racing -- will stay away from "industries that can create tension," and that it hopes to put out its first annual report this year.

But even Norway's fund, which is considered among the world's most transparent and publishes a full list of its investments once a year, said there are limits to what sovereign wealth funds should be expected to reveal.

"There may be very real and valid business reasons why you wouldn't want to be totally transparent about everything," said Martin Skancke, director general of the asset management department of Norway's Finance Ministry, which oversees Norway's $322 billion investment fund.

Saad recognizes that to achieve his goal of being able to invest freely all over the world, it's important to convince other countries that sovereign wealth funds are not a threat. That campaign, he said, begins with Washington.

"There is a real risk to global capital flow if they tighten on sovereign wealth funds. And it's a risk when it comes from the capital of capitalists," Saad said. "When you are the leader, the pioneer of bylaws, the largest economy in the world . . . if you even start to think of these things, it is a risk in itself."