Tale I – Norway
The Norwegian Oil Fund now owns 1.7% of all European shares – this for a country of 4.7 million people. It’s also known as the Petroleum Fund (Oljefondet in Norwegian) or The Government Pension Fund – Global.
The Fund is effectively a country pension fund – save up now during the “earning years” while the oil still flows and use this savings pool to supplement government revenues when the oil dries up.
Norway is transforming its current oil-based wealth into a sovereign fund based on the economic progress of the world.
It’s a more traditional approach to saving than Dubai’s transformational gamble to turn itself into a lasting financial centre. A few years ago it would have looked like the dull, conservative, less effective approach. Now, although stock market declines have hurt the fund, the higher risk nature of Dubai’s approach looks like speculation on a national scale.
This is not to say the citizens of Norway are entirely happy about this plan. Many want increased current spending so that they can have better, cheaper services now. Concerns have also been raised around the suitability of stock markets as an appropriate asset and how the enormous fund manages ethical decisions.