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Norway's sovereign wealth fund expects inflation and price losses


Norway's sovereign wealth fund is the largest in the world and has been generating good returns so far. But fund manager Tangen is cautious about the future. Above all, inflation will "have far more serious consequences."

Norwegian oil rig (archive picture): The sovereign wealth fund feeds on oil revenues

Photo: DPA / Norwegian Statoil

The head of the Norwegian oil fund expects a prolonged period of weakness in the international financial markets.

“We are preparing for a decade of lower returns.

Perhaps it will even be negative, "said Nicolai Tangen of the" Frankfurter Allgemeine Sonntagszeitung "(" FAS ") according to a previous announcement.

Norway's pension fund currently has a market value of around 1.2 trillion euros, making it the largest sovereign wealth fund in the world. It is fed with money from oil and gas production, administered by the central bank on behalf of the Treasury, and invests in thousands of companies worldwide, including large corporations such as Microsoft, Apple and Amazon. Around 70 percent of the assets are invested in shares, which also makes the Norwegians the largest single shareholder in the world.

According to the report, the fund has achieved an average return of 6 percent on its investments over the past 25 years.

"It will not go on like this," Tangen told the FAS. "The future will be less attractive to us than the past." The greatest danger for the stock and bond markets is inflation.

"I think this will have far more serious consequences than is currently assumed."

In Germany, the fund holds stakes in the Volkswagen car group, where it recently voted against the discharge of the board of directors and the supervisory board.

Tangen said: "We have clearly well-founded doubts about the actions of these bodies." The management of VW knows what it is about in detail;

in public, however, he does not want to discuss the criticism in detail.


Source: spiegel

All business articles on 2021-12-25

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