SINGAPORE, July 10, 2008 (AFP) - Representatives of the world's sovereign wealth funds wrapped up two days of meetings in Singapore on Thursday, saying they had made progress towards drafting voluntary guidelines.

Sovereign wealth funds (SWFs) are government-created investment vehicles that have emerged as a potent force on global markets, leading to concerns over a lack of transparency and national security in recipient countries.

In a bid to develop 'generally accepted principles and practices' for the funds, the International Monetary Fund (IMF) had gathered 25 of its member states with SWFs on May 1 to form the International Working Group.

'We continue to make progress on drafting' the guidelines, the co-chairs of the working group meeting said in a statement, adding they remain committed to establishing the voluntary principles by October.

With direct SWF input through the working group, the principles aim 'to promote a clearer understanding of the institutional framework, governance, and investment operations of SWFs that continue to support the maintenance of an open and stable investment climate globally,' the statement said.

The group is co-chaired by the IMF and the Abu Dhabi Investment Authority (ADIA).

ADIA, of the United Arab Emirates, is the world's largest sovereign wealth fund.

Asia Pacific members of the working group are Australia, China, New Zealand, South Korea, East Timor, Singapore and Vietnam.

The group said it will next meet in Santiago, Chile, on September 1.

Sovereign wealth funds today manage between two and three trillion dollars in investments, according to the IMF, an amount that is projected to grow to up to 10 trillion dollars in the next five years.

Singapore's state-linked investment firm Temasek Holdings, and the Government of Singapore Investment Corporation (GIC), are among the largest sovereign wealth funds in the world.

They recently made multi-billion-dollar investments in global financial houses battered by a US housing slump.