Prime Minister Mark Carney of Canada said Monday that his country would establish a pool of money similar to those used by major oil exporters like Norway to make investments as he seeks to make the Canadian economy less dependent on the United States.
Known as a sovereign wealth fund, it will focus on investments in Canadian infrastructure and will be operated like a private company. Canadians will also be able to invest in the fund.
Sovereign wealth funds are large pots of investment money that are generally managed independently, though they sometimes receive broad direction from governments about where they can put their funds.
In creating one of it own, Canada is following the lead of other countries, among them oil-rich nations in the Middle Eastern.
“This will be a Government of Canada fund, but more importantly, it will be a people’s fund, it will be your fund,” Mr. Carney told reporters in Ottawa. “Many countries that are blessed with natural resources, like Norway, have them. Canada has not until now.”
Mr. Carney linked its creation to his plans for major infrastructure projects like pipelines, ports, new nuclear generation and a high-speed passenger rail line. They are intended to bolster the economy in the face of President Trump’s trade war with Canada.
“For the first time in the history of Canada,” Mr. Carney said, “Canadians will not just contribute to the realization of these projects, they will benefit directly from their return.”
With an initial infusion of 25 billion Canadian dollars — about $18 billion — Canada’s new fund will be a fraction the size of Norway’s, which at $2 trillion is the world’s largest sovereign wealth fund.
It will also differ in its source of cash. Norway puts all government oil revenues into its account. But in Canada, underground natural resources belong to the provinces, and they collect and keep royalties paid by oil companies.
Alberta, the center of Canada’s oil and gas industry, set up a sovereign wealth fund in 1976. But in the following decade, the province stopped transferring any oil royalties to the fund and governments began withdrawing money from it. The Alberta fund held about $32 billion at the end of last year.
While Mr. Carney said that the fund would focus on investing in Canada, he offered no specifics. He also did not provide details about the source of the fund’s initial 25 billion Canadian dollars.
Ian Austen reports on Canada for The Times. A Windsor, Ontario, native now based in Ottawa, he has reported on the country for two decades. He can be reached at [email protected].
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