"Less than 20 years after they started producing oil, the Norwegians realized
their geological good luck would only be temporary. In 1990, the nation's
parliament set up the Petroleum Fund of Norway to function as a fiscal shock
absorber. Run under the auspices of the country's central bank, the
fund, like the Alaska Fund, converts petrodollars into stocks and bonds. But
instead of paying dividends, it uses revenues and appreciation to ensure the
equitable distribution of wealth across generations."
Now, their fund is worth "about $311 billion—or about $67,000 per Norwegian. With a 40 percent allocation in stocks, the fund owns more than $120 billion in shares around the globe".
Let's learn from the mistake made by the Saudis:
"the richest oil nation on earth still resembles a garden-variety poor
country: a 25 percent unemployment rate, tremendous inequality of wealth and
assets, a massive public debt, and an undiversified economy dependent on
commodity exports."
And let's pray that Brunei oil NEVER runs dry....
Salaam.
2 comments:
Surely, the Bruneian equivalent of the Norway fund is the BIA? And everybody's oil, even the Saudis', is going to run out in a few decades.
I am also hoping that it is what the BIA is doing. If they are doing what we think they are doing, I think I would like to get some 'sign' from them that they are doing well and we have got nothing to worry about our future, at least in the short term.
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