Source: AFP
Norway’s sovereign wealth fund, the world’s largest, posted a profit of more than $100 billion in the first quarter amid a global stock market recovery, it said on Thursday.
The fund — fueled by Norwegian state oil and gas revenues — returned 6.3 percent in the first three months of the year.
The $107 billion gain brought the fund’s total value to a staggering 17.7 trillion kroner ($1.6 trillion) at the end of March, or nearly $291,000 for each of Norway’s 5.5 million residents.
“Our equity investments performed very strongly in the first quarter, driven primarily by the technology sector,” the fund’s deputy managing director Trod Grande said in a statement.
The shares, which accounted for 72.1% of the fund’s portfolio, returned 9.1% in the first quarter, boosted by the stock market’s rally amid the prospect of lower interest rates.
![](https://images.yen.com.gh/images/d7166d68f5f4fd8b.jpg?impolicy=cropped-image&imwidth=256)
![](https://images.yen.com.gh/images/d7166d68f5f4fd8b.jpg?impolicy=cropped-image&imwidth=256)
Read also
Taiwanese chip giant TSMC’s earnings rise on artificial intelligence demand
The fund is the world’s largest single investor, with stakes in around 9,000 companies worldwide and representing 1.5 percent of the total market capitalization.
Investments in bonds, which account for 26% of assets, meanwhile fell 0.4% in the first quarter. Holdings in real estate and those in unlisted renewable energy projects also fell, by 0.5% and 11.4% respectively.
Weaker currency
Norway’s currency, the krona, weakened against several major currencies during the quarter, adding $59 billion to the fund’s value.
According to a ranking by the Sovereign Wealth Fund Institute (SWFI), the Norwegian fund is the largest in the world, just ahead of the China Investment Corporation.
The fund was created in the early 1990s and aims to finance future spending in Norway’s generous welfare state, as revenues from oil and gas exports are expected to decline in the long term.
![](https://images.yen.com.gh/images/3e8349e118d2e182.jpg?impolicy=cropped-image&imwidth=256)
![](https://images.yen.com.gh/images/3e8349e118d2e182.jpg?impolicy=cropped-image&imwidth=256)
Read also
The EU is seeking to take on China and the US to reverse economic decline
All of the state’s oil revenue goes into the fund: taxes, profits from state stakes in oil and gas fields, and dividends from oil company Equinor, which is 67 percent state-owned.
It is managed by the country’s central bank.
Norwegian governments are allowed to draw on the fund to balance the budget, but within a strictly defined framework.
They are only allowed to use the fund’s estimated returns, not the capital itself, to prevent capital depletion.
All investments are made outside Norway to avoid destabilizing the country’s economy.
The fund also follows strict ethical guidelines set by the Ministry of Finance.
For example, it is prohibited from investing in companies accused of serious human rights abuses, child labor or serious environmental damage, as well as manufacturers of “particularly inhumane” arms and tobacco businesses and companies that derive much of their business from coal.
![](https://images.yen.com.gh/images/564f91a9c84faea6.jpg?impolicy=cropped-image&imwidth=256)
![](https://images.yen.com.gh/images/564f91a9c84faea6.jpg?impolicy=cropped-image&imwidth=256)
Read also
ASML shares fall on lower earnings, orders
As a result, dozens of conglomerates, including giants such as Airbus, Boeing, British American Tobacco and Walmart, have been blacklisted by the fund.
Source: AFP