President Donald Trump’s plan to create a sovereign wealth fund that’s the world’s envy remains undefined.
In the meantime, Norway’s Government Pension Fund Global is among the largest in the world, with more than $1.8 trillion in assets.
In February, Trump told Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick they had 90 days to present him with a plan for a sovereign wealth fund. That time has passed and no plans have been released.
“Treasury and Commerce Departments have formulated plans for a Sovereign Wealth Fund, but no final decisions have yet been made,” White House spokesperson Kush Desai said.
Ana Nacvalovaite, a sovereign wealth funds research fellow at the University of Oxford’s Kellogg College, said the fund’s appearance depends on the details, including funding mechanisms, investment strategies, fund structure, and governance.
Nacvalovaite noted that relatively little information is known about the U.S. plans for a sovereign wealth fund. However, she said many other countries have established funds that the U.S. could follow, but the U.S. will likely face challenges.
Saudi Arabia’s Public Investment Fund, with $925 billion in assets, was established by royal decree in 1971. That could be one roadmap, but America has a different culture and government.
“There is a huge difference between a fund run by a country … where the Royals rule everything, versus an American system where it doesn’t quite work that way,” Nacvalovaite said.
Another question that remains unanswered is how the administration would seed the fund and whether it would need help from Congress, which traditionally allocates federal revenue. The U.S. has $36.2 trillion in debt and hasn’t had a surplus budget since 2001. The White House noted in February that the U.S. government holds about $5.7 trillion in assets. The administration said the U.S. holds far more in natural resources.
Trump also is bringing in new revenue through tariffs. Just how much that generates could vary based on the final terms of trade deals the White House initially hoped to complete by July 9. Tariffs are taxes on imported goods paid to the federal government by the company that imports the goods.
In Norway, the government declared it owned all offshore oil in the North Sea in 1963. Much of the money in the Government Pension Fund Global now comes from a mix of investments, including stocks and real estate. The fund reports it owns nearly 1.5% of total shares in the world’s publicly listed companies.
Most SWFs don’t report everything, which could raise concerns in the U.S.
“Any state-owned investment vehicle must have a focused mandate and a highly transparent and accountable governance structure,” Adnan Mazarei, Anna Gelpern and Edwin M. Truman wrote in a report for the Peterson Institute for International Economics after Trump’s executive order.
Nacvalovaite said some SWFs share more information publicly than others.
“Let’s not forget that there are some sovereign wealth funds which are not transparent,” she told The Center Square.
Four months ago, Bessent said the U.S. would have a fund “within the next 12 months.” That timeline could prove challenging.
Control in the U.S. would almost certainly be an issue. Some nations assign the task to a central bank or government agency.
Norway’s Ministry of Finance has overall responsibility for the fund. It also issues management guidelines. Norges Bank manages the fund.
Norway’s government gets some of the money to spend.
“The Norwegian government can spend only a small part of the fund, but this still amounts to almost 20% of the government budget,” according to the bank.
On average, the Norwegian government spends only the returns – estimated to be around 3% per year – not the fund’s capital.
The report from Peterson Institute for International Economics said the proposal carries risks, especially in absence of more information
“Without much greater clarity and a broadly shared understanding on these issues, a US SWF risks becoming a misplaced fiscal gimmick and an inefficient and potentially corrupt diversion of public resources that could do long-term damage to the US and global economy and financial markets,” it concluded.
