Chinese Sovereign Wealth Fund's Policy Recommendations

In recent years, as the global oil price sharply rose and Asian countries'accumulation of foreign exchange reserves accelerated, Sovereign Wealth Funds (SWFs) eventually drew close attention from the international community under the circumstance of global economic imbalance. SWFs, who manages sovereign wealth, brings certain influences to the international financial market for every investment it undertakes. Such phenomenon becomes more prominent after the breakout of Subprime Crisis in 2007, when many SWFs injected capital to world's famed financial institutions and objectively maintained global financial stability.As China's sovereign wealth fund, CIC has already made a number of diversified investments globally since inception in 2007, aiming to seek innovated management for China's foreign exchange reserves. At the same time, most SWFs (including CIC) are being closely concerned and strictly supervised by developed countries, due to the origin of capital and low transparency of investments.Based on reviewing the prosperity and development of SWFs, this thesis focuses on analyzing the positive effects that SWFs brings to international financial market, from the perspectives of international capital market, international reserve currency, foreign exchange reserve management, emerging countries'status and so on. Finally come the conclusions and suggestions for China to further develop sovereign wealth fund.