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NATO chief and former PM Stoltenberg eyes Norway central bank top job

NATO chief Jens Stoltenberg, whose contract expires next year, is in the running to take over as head of the Norwegian central bank, the country's finance ministry said on Tuesday.

Published: 14 December 2021 14:50 CET

Pictured is NATO chief Jens Stoltenberg.

Jens Stoltenberg, Norway's former PM and NATO's chief, pictured above, has thrown his hat in the ring for the top job at Norway's central bank. Photo by Bertrand Guay / POOL / AFP

Stoltenberg, a former Norwegian prime minister and finance minister, is one of a list of 22 candidates for the position, which becomes vacant in February, the ministry said in a statement.

“The finance ministry contacted me in November to see if I’d apply for the job. I did it, it’s a position that motivates me hugely,” the 62-year-old told AFP via his press office.

Stoltenberg has headed the North Atlantic Treaty Organization since 2014 and his contract expires on September 30, 2022.

The current governor of Norges Bank, Oystein Olsen, steps down in February.

“I made it clear to the finance ministry that if I get the job, I wouldn’t be able to start work until the end of my NATO mandate on October 1st,”
Stoltenberg said.

Also in the running is the central bank’s vice president, Ida Wolden Bache, another candidate asked to apply by the finance ministry with a background in economics and finance. But a number of students, a plumber, pensioners, a baker and a bus driver have all thrown their hats in the ring too.

The finance ministry will announce its decision at the beginning of next year. The Norwegian central bank sets monetary policy for the Nordic country and also manages its massive sovereign fund, the world’s biggest. The governor is appointed for a six-year term.

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Norway's trillion dollar wealth fund posts 107 billion dollar first quarter gain

The fund — fuelled by the Norwegian state’s oil and gas revenues — saw a return of 6.3 percent in the first three months of the year.

The $107 billion gain brought the fund’s total value to a dizzying 17.7 trillion kroner ($1.6 trillion) at the end of March, or almost $291,000 for each of Norway’s 5.5 million inhabitants.

“Our equity investments had a very strong return in the first quarter, particularly driven by the tech sector,” the fund’s deputy chief executive Trond Grande said in a statement.

Shares, which accounted for 72.1 percent of the fund’s portfolio, saw a 9.1 percent return in the first quarter, buoyed by a stock market rally amid the prospect of falling interest rates.

The fund is the world’s biggest single investor, with stakes in some 9,000 companies around the globe and representing 1.5 percent of the total market capitalisation.

Its bond investments, representing 26 percent of assets, meanwhile fell by 0.4 percent in the first quarter. Real estate holdings and those in unlisted renewable energy projects also fell, by 0.5 percent and 11.4 percent respectively.

Weaker currency

Norway’s currency, the krone, weakened against several main currencies during the quarter, contributing $59 billion to the increase in the fund’s value.

According to a ranking by the Sovereign Wealth Fund Institute (SWFI), the Norwegian fund is the biggest in the world, just ahead of the China Investment Corporation.

Created in the early 1990s, the fund is aimed at financing future spending in Norway’s generous welfare state, as revenue from oil and gas exports are expected to decline over the long term.

All of the state’s oil revenues are placed in the fund: taxes, profits from the state’s holdings in oil and gas fields, and dividends from oil firm Equinor, owned 67 percent by the state.

It is managed by the country’s central bank.

Norwegian governments are allowed to tap the fund to balance the budget, but within a strictly-defined framework.

They are only allowed to use the fund’s estimated returns, not the capital itself, to prevent the fund from being depleted.

All investments are made outside Norway to avoid destabilising the country’s economy.

The fund also follows strict ethical guidelines set by the finance ministry.

It is, for instance, barred from investing in companies accused of serious violations of human rights, child labour or serious environmental damage, as well as manufacturers of “particularly inhumane” arms and tobacco firms, and companies which derive a large part of their activities from coal.

Dozens of groups, including giants like Airbus, Boeing, British American Tobacco and Walmart, have therefore been blacklisted by the fund.

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