Trillion dollar baby : how tiny Norway beat the oil giants and won a lasting fortune

"For most of its history, Norway eked out a marginal existence from fishing, forestry and shipping. But things changed in 1969, when the country found one of the world's biggest offshore oilfields. As the revenue started to flow, Norway began to create the world's best system for developing mineral resources - and for extracting the maximum possible share of the profits. From the outset, Norway decided that it was the master and not the servant of Big Oil. Twenty years after it began stashing its cash, this country of just five million people has amassed the world's largest sovereign wealth fund, with assets of more than US$850 billion - and it's on track to exceed $1 trillion in 2020. Unlike many other countries, Norway has taken a non-renewable resource and turned it into a financial asset that can last for generations to come. This is the story of how the Norwegians did it."-- back cover For most of its history, the remote and near-Arctic nation of Norway has eked out a marginal existence from fishing, forestry and shipping . The most famous artwork to emerge from the country attests to its harsh and formidable existence: The Scream, painted by Edvard Munch in the mid-1890s. By the time of Munch's death in 1944 the country had not changed much, and it remained a relatively poor and isolated part of Scandinavia for the next three decades, with per capita income about 20-30 per cent lower than that of neighbouring Sweden. But things began to change after Christmas Eve 1969, which was the day when Phillips Petroleum discovered oil off the southern coast. As the revenue began flowing , Norway began having a long and serious debate about what it should do with this money. Over time its leaders began to put in place the most robust and visionary framework for extracting maximum benefit from non-renewable resources found anywhere in the world. Less than 20 years after the country began investing in what is now called the Government Pension Fund, Norway has the largest sovereign wealth fund in the world with assets of $940 billion. All of this money has been saved in just 18 years by a country with the population the size of Sydney. What's more, the fund is on track to hit the US$1 trillion mark within the next 2-3 years. Norway's savings strategy means that it has taken a non-renewable resource and turned it into a financial asset that can last forever. The current generation of Norwegians now enjoy the highest standard of living in the world, but this has been achieved by a policy that will also hand on generations to come an endowment that will maintain this high standard of living long after the oil wealth has been completely exhausted. This is the story of how they did it. For most of its history, the near-Arctic nation of Norway eked out a marginal existence from fishing, forestry and shipping. But things began to change in 1969, when the country confirmed it had found one of the world’s biggest offshore oilfields. As the revenue from this field and many others started to flow, Norway began to create the world’s best system for developing mineral resources, and for managing the revenue.

From the outset, Norway decided that it was the master and not the servant of Big Oil. Through trial and error it introduced policies to develop industry and know-how, and gained the maximum possible share of the profits. Twenty years after Norway began stashing its cash, the country of just five million people has amassed the world’s largest sovereign wealth fund, with assets of more than US$850 billion – and it’s on track to exceed $1 trillion in 2019.

Unlike many other countries, Norway has taken a non-renewable resource and turned it into a financial asset that can last for generations to come. This is the story of how they did it.

Paul Cleary is the author of Mine-Field: The Dark Side of Australia's Resource Rush. He is a senior writer with the Australian and a researcher in public policy at the Australian National University. For most of its history, the remote and near-Arctic nation of Norway has eked out a marginal existence from fishing, forestry and shipping. That is, until Christmas Eve 1969, when oil was discovered off its southern coast. Rather than squandering the profits (as the UK did with its North Sea oil), when the revenue began flowing, Norway put in place the most robust and visionary framework for extracting maximum benefit from non-renewable resources found anywhere in the world. Less than twenty years after the country began investing in what is now called the Government Pension Fund, Norway has the largest sovereign wealth fund in the world, with assets of USD70 billion. What's more, the fund is on track to hit the USD trillion mark by 2020. Not only is every Norwegian now a (krone) millionaire and enjoying the highest standard of living in the world, they will be able to hand down this endowment to their children and grandchildren. Norway's savings strategy means that it has taken a non-renewable resource and turned it into a financial asset that can last long after the oil wealth has been completely exhausted. This is the story of how they did it AFor most of its history, the near-Arctic nation of Norway eked out a marginal existence from fishing, forestry and shipping. But things began to change in 1969, when the country confirmed it had found one of the world's biggest offshore oilfields. As the revenue from this field and many others started to flow, Norway began to create the world's best system for developing mineral resources, and for managing the revenue.----Paul Cleary is the author of Mine-Field: The Dark Side of Australia's Resource Rush and a researcher in public policy at the Australian National University Titel Page; Copyright; Contents; Chronology; Map of Norway and its Maritime Territory; Prologue; 1. Out of the Darkness; 2. Into the Deep; 3. Command and Control; 4. The Price of Prosperity; 5. Seabed Soldiers; 6. Planning and Failing; 7. Trolling the Soviets; 8. Cash Cow; 9. The New North; 10. Nordic Rules for Riches; Afterword; Appendices; Acknowledgements; Bibliography; Notes; Index; Back Cover. An fascinating account of how Norway reinvested its oil revenue to ensure for the benefit of future generations.