Norway: Siltanews – News Desk
Asset owners have identified that one of the long-term consequences of the Trump administration’s tariff policy and market fallout could manifest with investors retreating from a US-concentrated portfolio. It makes a timely moment for Norway to launch a new sovereign wealth fund specifically designed to plough investment into local companies.
The Norwegian Parliament has approved seed funding to invest NOK 15 billion ($1.4 billion) in a specialist Nordic small-cap equity fund with the potential to double the allocation over time. Three portfolio managers have started work in unlikely headquarters in the remote town of Tromso in northern Norway above the Arctic Circle, thousands of kilometers from Oslo.
The fund will be overseen by Norway’s domestic pension fund, Oslo-based NOK 381 billion ($35 billion) Government Pension Fund Norway (Folketrygdfondet) – Government Pension Fund Global’s smaller sibling – but has a delegated investment strategy.
Government Pension Fund Norway CEO Kjetil Houg has played a pivotal role in creating the new fund and believes its birth chimes with emerging themes of investors putting more capital to work at home.
“Large investors should consider their geographical location; there is no reason to send money far away in the current climate,” he told Top1000funds.com in an interview.
The new pool of domestic investment could help boost liquidity in the local market and encourage Nordic companies like Sweden’s Spotify and payments Fintech Klarna, which has just delayed listing in New York because of market volatility, to list locally rather than in the US, he suggests.