The Monitor’s Editorial Board
Christian Science Monitor

As more nations set up funds for the money earned from natural resources or exports, many also adopt principles of transparency and accountability – and a concern for future generations. They should look to Norway, which runs the largest ‘sovereign wealth fund.’

FEBRUARY 28, 2017 —In about 20 countries, revenue from oil drilling accounts for more than 10 percent of the economy. This natural wealth has long been a tempting source of easy cash for a government’s short-term needs or budgetary holes. Yet as oil prices have fallen, more petroleum-producing nations are taking the long view. They are saving or investing the money to benefit future generations – and to prepare for the day the oil wells run dry.

In recent years, the world has seen a rapid rise in the number of government-run kitties, or “sovereign wealth funds.” In all, more than 75 of these funds now hold $7.4 trillion. Most sock away money earned from natural resources. Others are set up by big exporters, such as Singapore, to keep their foreign earnings for future needs.

With so much money, the funds can be easy targets for politicians. Yet even as the funds have multiplied, many have adopted principles, set down nearly a decade ago by the International Monetary Fund, to be transparent and accountable in how the money is invested and spent.

It also helps that the world’s largest sovereign wealth fund is also a model. Norway, which is Western Europe’s largest oil producer and one of the world’s largest natural gas exporters, has put aside more than $900 billion in its fund since the 1990s. To put that in perspective, the fund owns more than 1 percent of the world’s traded equity shares. Its purpose is to shield the country’s economy from price fluctuations in oil and to support government savings. Read the rest of this entry »