SWF Activity on Ice in U.S.

A memo posted yesterday to the Harvard Law School Corporate Governance blog and written by Mark Gordon of Wachtell, Lipton Rosen & Katz explores the reasons for a dramatic slowdown in the U.S. of investments by sovereign wealth funds.

SWFs have continued to grow in size and new SWFs have been announced, including Russia's $32-billion National Wealth Fund, the $53-billion arm of Saudi Arabia's Public Investment Fund, and a planned $6-billion fund by the Chilean government.

Even so, the memo, titled "Sovereign Wealth Fund Investment in the U.S.," reports that there has been only one significant SWF investment in the U.S. since January.

The reason? Gordon and coauthors Adam Emmerich and Sabastian V. Niles suggest that "uncertain political receptivity to SWF investments and heightened regulatory activity have chilled SWF interest in the U.S. by increasing the risks and costs of investment."