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
Brookfield revives €7bn takeover talks with Grifols as shares surge 11%
Brookfield revives €7bn takeover talks with Grifols as shares surge 11% Brookfield has resumed takeover discussions with Spanish pharmaceutical group Grifols, according to Spanish news outlet El Confidencial, sparking an 11% surge in the company’s share price during...
Oaktree targets $4bn for Special Situations Fund IV amid global trade uncertainty
Oaktree targets $4bn for Special Situations Fund IV amid global trade uncertainty Oaktree Capital Management is raising capital for its fourth Special Situations Fund, aiming to secure around $4bn to invest in distressed debt, structured equity, and direct equity,...
IK Partners closes record €3.3bn Fund X amid surge in deal activity
IK Partners closes record €3.3bn Fund X amid surge in deal activity IK Partners closed its tenth midcap vehicle, IK X Fund, at its €3.3bn hard cap, marking the firm’s largest fundraise to date. The close comes on the heels of strong institutional demand, with...