Page last updated at 12:56 GMT, Friday, 29 February 2008

Dubai fund hits back at criticism

Dubai skyline
Dubai World is owned by the Dubai government

The boss of one of the Middle East's best-known investment funds has warned against any European Union (EU) moves to increase their regulation.

State-run investment vehicles, Chinese and Middle East sovereign wealth funds have recently bought stakes in a number of Western banks and other businesses.

Sultan Ahmed Bin Sulayem, chairman of Dubai World, said such funds might choose not to invest in Europe.

He was responding to EU criticism that the funds are too "opaque".

If you put a politician in charge of an investment, believe me, that investment fund will not last for a very long time
Sultan Ahmed Bin Sulayem

The comments came earlier this week from EU Monetary Affairs Commissioner Joaquin Almunia and EU Internal Market Commissioner Charlie McCreevy.

Raising the prospect of EU moves to control sovereign wealth funds, Mr Almunia said the investment vehicles needed to be aware of their "responsibilities".

While Mr McCreevy added that the EU had no plans to limit investment by such funds, he said all business "should follow some common principles on transparency and governance".

'Move elsewhere'

Mr Bin Sulayem, whose Dubai World owns UK ports group P&O, said he was "surprised" that people were concerned about such funds.

"If somebody comes with regulations that make it difficult for someone from certain geographical locations to invest in Europe or the west, people will take their investment somewhere else," he said.

Mr Bin Sulayem also denied that the funds had too much political inference from their government owners.

"If you put a politician in charge of an investment, believe me, that investment fund will not last for a very long time," he said.

Dubai is one of the seven self-governing emirates that make up the United Arab Emirates.

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