Norway has always said its sovereign wealth fund belongs to the people. But recently, that’s needed a bit of clarification.
Since hitting a record 10 trillion kroner ($1.1 trillion) last month, the fund has noticed an uptick in inquiries from Norwegians wondering whether they can now withdraw their share. Requests range from people asking for their full pro-rata stake — which, given Norway’s population of about 5.3 million, comes to more than $200,000 per person — to less serious pleas for a few coins to buy a can of soda.
“It’s nice that people get involved and are aware that this fund belongs to everyone,” said Marthe Skaar, a spokeswoman for Norges Bank Investment Management, which manages the fund from Oslo.
Though some Norwegians may be disappointed to learn they can’t make withdrawals, Skaar says the sudden spike in public interest in the fund represents a good opportunity to explain it’s also supposed to benefit future generations. She said that such requests are nothing new and the fund doesn’t keep a precise tally, although there had been an “upswing” after the valuation milestone.
The Government Pension Fund Global, as it is officially known, isn’t really a pension fund. Its purpose is to ensure that Norway keeps profiting from its oil wealth long after the fossil-fuel era ends. It only invests outside Norway, to avoid overheating the domestic economy.
Fiscal Stimulus
The government also spends some of its oil wealth on present-day Norwegians. After a drop in crude prices, it was forced to tap the fund to pad its budget in a rare example of fiscal stimulus in Europe.
A lot of oil-producing countries have set up wealth funds, but Norway’s remains a unique experiment in natural-resource wealth management. The fund’s mandate is anchored in Parliament, and has evolved over time with ethical restrictions on tobacco, certain weapons and most coal producers.
Norway’s wealth fund holds roughly 1.5% of the world’s listed equities. The past decade has seen a steep increase in its value, after a buying spree on cheap stocks during the financial crisis resulted in a quadrupling of its size since 2008. More than half the investor’s value is from its returns.
Source: Bloomberg
Can’t stop reading? Read more
BP launches Castrol sale to meet $20bn divestment target, eyes private equity bids
BP launches Castrol sale to meet $20bn divestment target, eyes private equity bids BP has initiated the sale of its Castrol lubricants unit, aiming to raise up to $10bn as part of a broader $20bn divestment plan by 2027. The move comes as the British energy group...
KKR to sell up to $410m stake in HD Hyundai Marine Solution via block trade
KKR to sell up to $410m stake in HD Hyundai Marine Solution via block trade KKR is preparing to offload up to 8.5% of its stake in HD Hyundai Marine Solution through a block trade valued at up to KRW 560bn ($410m), according to sources in the investment banking...
GTCR to return over $5bn to LPs in 2024 following string of high-profile exits
GTCR to return over $5bn to LPs in 2024 following string of high-profile exits GTCR is on track to return more than $5bn to limited partners in 2024, positioning itself as one of the few private equity firms delivering substantial liquidity amid a subdued exit...