A report released by the Norwegian government encourages the country’s pension funds to increase their investments in domestic private equity; the country is looking to boost the financing of its more innovative companies.
According to the report, interest in domestic private equity has fallen rapidly in the last eight years.
From Investments and Pensions Europe:
Norwegian pension providers should increase their exposure to domestic private equity to improve the country’s growth prospects, an in-depth government report has suggested.
According to the productivity commission, the state should also recognise that regulation has acted as a barrier to competition in the provision of public sector pensions, with the report pointing to the departure of DNB and Storebrand, leaving only KLP to bid for local authority provision.
The commission’s initial, 542-page report will now be examined by the government before a second paper puts forward concrete reform proposals on how the Norwegian economy should adapt as the role played by the oil industry declines.
It noted that there had been a marked fall in interest from domestic private equity funds since 2007, when the industry agreed to 160 first commitments.
The figure fell to just 15 a year by the end of 2013.
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It concluded that there was room for long-term investors, including pension providers, to increase their role in funding start-ups and small and medium enterprises (SMEs).
Read IPE’s interview with the chief executive of Norges Bank Investment Management here.