Athira Sethu
Kochi, 4 February 2025
U.S. President Donald Trump signed an executive order to start forming a U.S. sovereign wealth fund. Such a fund might save TikTok from being banned in the United States. Smaller countries have sovereign wealth funds, Trump explained, and it is time that the U.S. also should have one.
A sovereign wealth fund is a government investment fund that pools extra money from somewhere like natural resources or trade surpluses. Such funds are then invested and yield profitable returns in the future. Some of the countries that have the most massive sovereign wealth funds include Norway, Abu Dhabi, China, and Saudi Arabia. For instance, Norway has the world’s biggest sovereign wealth fund with $1.75 trillion after presenting a 13% return in 2024.
Trump thinks that the U.S. government’s size and business transactions should yield advantages for American citizens. The fund will be beneficial to the American people, according to Commerce Secretary Howard Lutnick. The U.S. Treasury Secretary Scott Bessent said that the fund will be established in the next 12 months.
For instance, one of the ways this new sovereign wealth fund can be utilized is in assisting in buying the TikTok application. This is because U.S. law has ordered TikTok to sever its relationships with its Chinese owner, ByteDance, or risk being banned from using the U.S. markets. This is on the account that U.S. activists feel this Chinese-owned app can go ahead and spy on Americans or influence U.S. public opinion. Trump has given TikTok until April 2025 to comply with this law.
Trump said that he may fund the acquisition by using the sovereign wealth fund. He even thinks of collaborating with rich investors and purchasing the platform. He said that he had talks with quite a few, including Elon Musk, Larry Ellison, and even Microsoft, concerning the purchase of the app. If the price is reasonable enough, then according to Trump the deal will see the light, otherwise, it won’t.
