State-sponsored money and the new market order

Sovereigns are making more investments in Asia than ever before, resulting in service providers building up teams to cater for the expanded needs of sovereigns, supranationals and agencies. What impact do state-backed entities have on regional markets? And how do sovereign funds manage their risks?

Asia has emerged during the past decade with many of the world's largest state funds. These funds include central bank reserves, social security funds, state pension funds, investment authorities and stabilisation funds. Indeed, the size of many state funds has continued to grow despite the onset of the recent global financial crisis, with countries such as China and South Korea increasing their foreign currency reserves.

China, Hong Kong, Japan, Singapore, South Korea and Taiwan each hold more