Abang Johari: Sarawak keen to engage with Norway on forming sovereign fund

Abang Johari (centre) and the Sarawak delegation in a group photo following a visit to Norges Bank.

KUCHING, May 13: Sarawak will engage with Norway in an earnest effort toward successfully forming and managing its own sovereign wealth fund.

Given the widely acclaimed success of Norway’s sovereign wealth fund, which had been managed with the highest standard of governance since its inception in 1996, Premier of Sarawak Datuk Patinggi Tan Sri Abang Johari Tun Openg pointed out that it was a standard Sarawak needed to benchmark on.

“Given the many parallels between Sarawak and Norway, Sarawak is particularly interested in the lessons to be learnt from Norway as they have around 25 years of experience in developing the fund,” he said in a statement issued from Oslo, Norway today.

Abang Johari raised this during a meeting with officials from a ministry and the Norges Bank Investment Management at the bank’s headquarters in Oslo.

During the meeting, he was informed that the Norges Bank Investment Management had been appointed to manage the sovereign wealth fund called the Government Pension Fund Global, which was formed to manage the country’s oil revenue.

He also took note that the fund received its first injection of oil money of two billion Norwegian kroner from Norway’s government in 1996 and 2021, and it reported a total value of US$1.34 trillion with all investments in equities and real estate outside the country.

“(As) Sarawak developed a thinking around creating a sovereign fund, the government had benchmarked many similar funds around the world. Therefore, of great interest to Sarawak, you (Norwegians) have the largest global sovereign fund (with) renowned good governance practices and clear policies in fund management,” he told the officials present.

The Premier highlighted that Norway and Sarawak shared many common attributes. Both are large and sparsely populated and blessed with considerable natural resources, particularly oil and gas and hydropower.

“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 added.

Acknowledging that Norway is leading Europe in energy transition with virtually all its electricity being generated by renewable sources and has one of the highest proportions of electric vehicles in the world, Abang Johari emphasised that Sarawak also aims to be the leading territory in Malaysia in energy transition and to move away from dependency on fossil fuels.

“Sarawak has been a significant producer of oil and gas since 1910 but had only recently experienced a significant increase in revenue from the source.

“Given the energy transition (towards green fuel), we expect this will be a temporary increase, lasting for at most the next generation or around 25 years.

“As such, I believe that aligned to our desire to develop a multi-generational 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.

With Sarawakians responding positively to the Sarawak government’s plan to set up the sovereign fund, the Premier expressed its seriousness to deepen dialogues with Norway to understand better the lessons learnt from developing the fund, structure, and governance of the fund well as to get recommendations.

“We would also like to hear from you what your parameters are for investing in places like Sarawak and what we can do to ensure that we are high up in your list of attractive and ethically sound places to invest part of your fund,” he said.

Abang Johari’s two-day visit to Norway was 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 in the Netherlands on Monday (May 9).

Those present included Deputy Premier Datuk Amar Douglas Uggah Embas, Deputy Minister of Energy and Environmental Sustainability Dr Hazland Abang Hipni, State Attorney General Dato Sri Talat Mahmood Abdul Rashid and State Financial Secretary Dato Sri Dr Wan Lizozman Wan Omar. — DayakDaily