Gordon Brown extended the welcome on his maiden visit to China as his nation's leader, in sharp contrast to a more guarded response in the United States and other nations to the rise of sovereign wealth funds.

"We want Britain to benefit from the 200 billion dollars of investment available through the Chinese Investment Corp.," he told a gathering of British and Chinese businesspeople in Beijing.

"The UK has benefited from our policy of open trade and investment and remains committed to it, so we would welcome the CIC setting up an office in London."

Britain, he said earlier after talks with Chinese Premier Wen Jiabao, should become "the first location for Chinese investment, in Europe and in the rest of the world."

The CIC, established in September last year, is charged with investing roughly 200 billion dollars of China's 1.5-trillion-dollar foreign exchange reserves.

According to some estimates, the funds under CIC management could triple within the next couple of years, as China seeks to shift a growing part of its forex reserves out of low-yield US Treasury bonds.

"London may wish to consolidate its position as a global financial centre," said Sun Mingchun, a Hong Kong-based economist with Lehman Brothers.

"If CIC accepts the invitation, a lot more Chinese investors in the private sector will probably follow suit and go to Britain," he said.

The CIC has already sealed a series of high-profile deals abroad, including a three-billion-dollar share in private equity firm Blackstone and five billion dollars in investment bank Morgan Stanley, both US-based.

Sovereign wealth funds are emerging as a new powerful class of institutional investors, often -- as is the case with nations such as Russia and Abu Dhabi -- financed with revenues from booming oil exports.

They are already believed to manage more funds combined than all hedge funds on the planet, and their close links to government have been a source of some concern, especially in the United States.

"When the government becomes both referee and player, the game changes rather dramatically for every other participant," Christopher Cox, chairman of the US Securities and Exchange Commission, said in a speech last month.

"When it comes to transparency, the track record to date of most sovereign wealth funds does not inspire confidence."

Independent analysts said the US position lacked consistency, given the acquisitions the CIC had been allowed to make so far.

"Hasn't the CIC bought (shares in) Morgan Stanley and Blackstone?" said Zuo Xiaolei, a Beijing-based analyst with Galaxy Securities.

"In a sense, what the Americans say is completely different from what they do."

A British government official told reporters later they were "quite surprised" at Chinese Prime Minister Web Jiabao's pledge "to enable the funds overseas to be transparent and open."

"It's probably the most forward public statement that the Chinese have made in relation to their sovereign wealth fund operating on a commercial basis," he said, speaking on condition of anonymity.

Even so, China signals awareness of the foreign concerns. On Friday, Wen pointed out that only part of the CIC's 200 billion dollars would be invested abroad, as one third had been spent on reforming domestic banks.

Meanwhile, Brown said he was keen to cooperate with China and others on improving transparency and corporate governance.

"I recognise in some countries it's controversial but having talked to Premier Wen... I think it's true that Britain will welcome the substantial investment from the Chinese in the years to come," Brown said.

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