But the invasion of the sovereign wealth funds – the global investment issue of the decade - is another issue altogether. So far they have operated almost invisibly, working through the stock exchanges, private equity, pension funds and other mediums for large-scale transactions. According to some governments such as successive French administrations, the ‘sovs’ have operated by stealth. The IMF’s senior economist Simon Johnson has referred to the funds distributing their investments through ‘black boxes.’ Indeed presidents and prime ministers have woken up to find some of their country’s plum assets have been acquired without even a how-do-you-do by the investment arms of countries they might never have even visited.

Blocked funds
The US Senate was so shocked by an overnight $35bn worth of investments by the funds in its financial services industry that it recently ordered the Government Accountability Office to find out more about them. And that was after the Senate blocked the Dubai fund, which is controlled by the royal family, from taking control over some of America’s ports in 2006. France has established a sovereign fund with the sole purpose of blocking raids by foreign funds. Germany’s chancellor Angela Merkel has expressed her nervousness of the funds’ long-term intentions, especially that of Russia’s harmless-sounding Future Generation Fund that has been gobbling up energy assets. And resources-dependent Australia is more than interested in the intentions of China’s state-owned aluminium producer Chinalco after it paid $14.2bn for nine percent of Rio Tinto.

It is the unbridled purchasing power of the sovereign funds that worries governments. Singapore’s Government Investment Corporation has splashed well over $20bn on buying up large chunks of Wall Street and Zurich, and has perhaps another $330bn at its disposal. (Nobody knows exactly.) At the current rate of growth, the funds – most of which have grown fat on petrodollars – could have a combined war chest of $27trn within 15 years, according to Morgan Stanley.

Worried about its steel industry, Japan has called for a ‘global rule book’ in the way these generally government-led funds operate. Clearly something has to be done, if only to clear the air. Thus rather than having economies quietly bought up by shadowy exponents of territorial acquisition, moves are belatedly afoot – the sovereign funds have been around since the fifties – to draw up rules of engagement by which we can all abide. The IMF, EU, Britain’s Treasury and other organisations have engaged in a dialogue with the funds to talk them around to desired levels of transparency.

Given the reaction of people like Tony Tan, deputy chairman of Singapore’s GIC, this seems certain to happen. Indeed Mr. Tan claims to have initiated discussions with the IMF on the subject – and he should probably have done some much earlier. The Singapore funds were established more than 30 years ago. The model he should study is Norway’s global government pension fund, existing purely for financial reasons and regarded as a model of good behaviour.

Huge implications
However, it should be remembered that most countries aren’t too bothered. While the presence of an empire-building foreign army on a nation’s soil is clearly a matter with huge implications, the arrival of a large dollop of capital from abroad boosts the economy, just like a plane-load of tourists.

That is certainly the view of Britain’s Treasury which does not feel menaced by the funds. In fact, quite the contrary. Provided one hasn’t surreptitiously acquired BuckinghamPalace or the Royal Navy, it is okay. Anyway, the funds have so far invested in purely business-driven ways. Had they acted otherwise, there is no doubt governments would have found the means to repel them.

The required next steps in the management of what will anyway be an unstoppable wave of investment are obvious. Governments must decide exactly which assets are strategic and therefore off-limits, asking themselves the essential question: Can this investment be used against the national interest? And the sovereign funds must be prepared to tell the world more about themselves.

If those measures are taken, nobody should get hurt.