USA to Set Up Sovereign Wealth Fund Under Trump

On Monday 3 January 2025, President Trump signed an Executive Order to create a Sovereign Wealth Fund (#SWF). The measure is part the package to leverage ‘dormant assets’ in order to ‘make America great again.’

Americans are perhaps more familiar with Public Pensions Funds which has been investing retirements savings for state, city, and county public employees. Some of the largest Pension Funds work for the benefit of American teachers.

The SWF will invest on behalf of the country on a grander national scale. Alaska has somewhat of a state-level Sovereign Wealth Fund managing some USD 80 billion in assets. In 2024, it paid out more than USD 900 million in dividends to Alaskans.

Some of the most famous and successful SWF in the world include Norway’s Government Pension Fund Global (GPFG) and the Singapore’s Government Investment Corporation (GIC). The Norwegian Sovereign Wealth Fund GPFG is managed by Norges Bank Investment Management (NBIM) and has over USD 1.7 trillion of assets under management (AUM). As for GIC of Singapore, it has over USD 700 billion of AUM with investments spread across 40 countries.

Given the weight of the US economy, the American Sovereign Wealth Fund is expected to grow to several trillions of dollars within a relatively short time. The Departments of Treasury and Commerce will work in close coordination to operationalize the SWF.

Managing large sums of money, the goal tend to be more conservative and a return little over inflation is usually considered as a satisfactory performance for SWF, as opposed to a private investment firm with a more aggressive risk profile which manages smaller amounts and aims for higher returns. Singapore’s Temasek Holdings, despite being state-owned investment fund, is considered to act more like a private investment firm.

President Trump alluded to some USD 5.7 trillion in assets which could be put to work. The Federal Government is the largest landowner in the USA and possesses nearly 30% of all land. Since the advent of shale extraction technology, the US has evolved from an importer to become an exporter of oil and gas. Therefore, these assets could be put to good use in order to generate more wealth for the USA.