Amidst the war in Europe, rampant inflation, and elevated interest rates, one of the world’s largest investors lost -14.1% last year. Norway’s Government Pension Fund Global reported a loss of 1.64 trillion Norwegian kroner—roughly $164 billion—for 2022, the biggest loss the fund has recorded in a single year, according to an article in CNBC.
The “very unusual” market conditions “negatively impacted both the equity market and bond market at the same time,” said Nicolai Tangen, CEO of Norges Bank Investment Management, in a statement about the loss, adding that every sector in the equity market garnered negative returns in 2022, save for the energy sector. The fund was created in the 1990s as a way to invest Norway’s surplus oil and gas revenues from the country’s large reserves that are the foundation of the fund’s wealth. But in the wake of Russia’s invasion into Ukraine, as Norway’s fossil fuel revenues soared, many lawmakers, economists, and even energy industry executives have argued that the Norwegian government should pour those huge profits into an international solidarity fund, setting an example that the rest of the world will hopefully follow, the article reports.
Over the years, the fund has invested in 9,300 companies across the globe, with current holdings worth $1.3 trillion. The biggest loss the fund had previously incurred was 633 billion kroner in 2008, according to CNBC.