Professor Stephen Kinsella:

It is a really good question. I talk about it a little in the paper with regard to investing in Irish equities. Basically, if there are two funds, ISIF and this new fund, both investing in Irish equities, then at the very minimum there will be a lower cost of funds for Irish businesses, which may lead to state aid rule issues, and we will almost certainly crowd out private sector investment in some areas, which I am almost certain is not what is wanted. That is one con. A second con with investing in land or private infrastructure such as wind farms is that while this will be a small sovereign wealth fund, it will be a large amount of money relative to the overall Irish economy. For example, if option 3 holds and the maximum invested amount is put in, which garners a return of 3% and there is €100 billion or €110 billion to spend, that is about as much money as the entire Government spends today. If that was thrown into anything Irish, it would basically explode whatever sector was being invested in. One would have to be very careful.