Fears about the unrestrained influence of sovereign wealth funds will likely stimulate wider protectionism anyway if effective regulation is not introduced. Protectionist politicians may exploit fears of foreigners to restrict any kind of foreign investment, and seek to build up national champions as a defensive measure. This risks losing all the economic benefits of globalisation, such as opportunities to unwind financial imbalances and to spread expertise, while directing capital to areas where it can have the greatest impact. Better to regulate SWFs now for fear of a greater backlash later.