Government-Linked Corporations (GLCs) and Sovereign Wealth Funds (SWFs)?

In many countries in Asia, Government-Linked Corporations (GLCs) and Sovereign Wealth Funds (SWFs) feature conspicuously in their economic framework. Are these institutions a boon or a bane to the economics of these nations and to the world?

Government-Linked Corporations (GLCs) and Sovereign Wealth Funds (SWFs)?
Generally speaking, a recipe for disaster.





The rest of the world doesn't have it as bad because they get to sell assets for far more than they are worth, but the economies of the nations involved lose and so the world as a whole does too.





The most obvious effect is what happens whenever anyone has more than s/he knows what to do with. many have written about it, so there is little for me to add.





However, another effect is that with a major source of income, everyone is focused on getting a (bigger) share rather than creating other sources. As a lovely example, look at the island nation of Nauru, which boomed on sale of phosphates and busted once the phosphates were gone:


http://en.wikipedia.org/wiki/Nauru





So many of the Middle East petro dollars have gone to pay for free universities, but with no other economic activity in the countries, the university graduates can't find jobs worth doing. What do you think that does to the long term viability of a society and its economy?

summer soles