Norway’s Sovereign Wealth Fund

Abstract

Norway’s sovereign wealth fund (SWF), the Government Pension Fund Global (GPFG), has become the largest in the world. But size is not the most unique or interesting feature of Norway’s petroleum fund. This contribution describes how the Norwegian authorities took their time before committing to a SWF, deciding instead to spend the country’s first oil revenues on developing its welfare state and paying down its debts. Once established, the GPFG developed several unique characteristics. What is perhaps most remarkable about the GPFG is the way that its funds can (and cannot) be accessed by political officials. In this way, the GPFG plays an important role in protecting the Norwegian economy from some of the curses we often associate with resource wealth. Finally, this contribution examines the unique way in which Norway manages the GPFG, by including strong political and ethical components when determining where it will place its investments.