KUCHING (May 13): Sarawak will engage seriously with Norway in an earnest effort towards the successful formation and management of its own sovereign wealth fund, Sarawak Premier Tan Sri Abang Johari Tun Openg said.
Given the widely acclaimed success of Norway’s sovereign wealth fund that had been managed with the highest standard of governance since its inception in 1996, it is a standard Sarawak needs to benchmark on, he pointed out.
“Given the many parallels between Sarawak and Norway, Sarawak is particularly interested in the lessons to be learnt from Norway, given that it has around 25 years of experience in developing the fund,” he said in a statement issued from Oslo on Friday (May 13).
Abang Johari is on a two-day visit to Norway as part of his week-long itinerary to Europe that saw him being given the honour to deliver a keynote address at the World Hydrogen 2022 Summit and Exhibition in Rotterdam, Holland on Monday.
When meeting officials of the Norges Bank Investment Management which had been appointed to manage the Norwegian wealth fund, he was informed that the fund called The Government Pension Fund Global received its first injection of oil money of two billion kroner from Norway’s government in 1996.
“In 2021, it reported a total value of US$1.34 trillion (about RM5.89 trillion) with all investments in equities and real estate outside the country,” he said.
Abang Johari said as Sarawak develops a thinking around creating a sovereign fund, the government had benchmarked many similar funds around the world and found the Norwegians' the largest, with renowned good governance practices and clear policies in fund management.
He said Norway and Sarawak that are both large and sparsely populated and blessed with considerable natural resources, particularly oil and gas and hydropower, share many common attributes.
“Sarawak, as the largest constituent territory of Malaysia, is around one-third the size of Norway, with around half the population. We also share a common desire to move towards sustainable development, preserving the world for future generations,” he said.
Acknowledging that Norway is leading Europe in energy transition with virtually all its electricity being generated by renewable sources and has one of the world’s highest proportions of electric vehicles, Abang Johari said Sarawak aims to become Malaysia’s leading territory in energy transition, moving away from fossil fuel dependence as it had been a significant oil and gas producer since 1910.
However, only recently it experienced a significant increase in revenue from oil and gas and given the energy transition towards green fuel, this increment is expected to last up to one generation or around 25 years.
“As such, I believe that, aligned to our desire to develop a multigenerational sustainability strategy for Sarawak, we should not consume all the increased revenue now, but rather put some aside for the benefit of future generations in the form of a sovereign fund,” he added.