Arguing that “sovereign wealth funds are not the big bad wolf at the door, “the European Commission has proposed that European Union leaders endorse a common approach to increasing the “transparency, predictability and accountability of SWFs.”
A common approach, the EC contends, will strengthen Europe’s voice in international discussions aiming to establish a code of conduct including standards in areas of transparency and governance. The EC is the executive arm of the EU which is scheduled to meet March 13th. On financial stability, the Commission wants the European Council to confirm the principles which will guide the EU’s efforts to improve financial market transparency and reinforce prudential control and risk management, and to set out the broad lines of the action to be taken.
“Europe must remain open to inward investments,” said Commission President José Manuel Barroso in a statement. “Sovereign wealth funds are not a big bad wolf at the door. They have injected liquidity and helped stabilize financial markets. They can offer reliable long-term investments our companies need. To ensure this, we need global agreement on a voluntary code of conduct.”