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Sunday, April 21, 2024

Political waves roll over the oil fund

A decision by the Norwegian finance ministry’s council that makes ethical reviews of investments by the country’s huge sovereign wealth fund has created some political backlash. The council’s recommendation that the fund sell off and ban investments in two Israeli companies is sparking criticism from within both the government’s Progress Party and the opposition.

Popularly known as the “oil fund,” its investments are reviewed by the ethical council (Etikkrådet) within the finance ministry, which now is under the political control of the Progress Party with its leader, Siv Jensen, as finance minister. Jensen has accepted the council’s latest recommendations that the fund ban three companies: Africa Israel Investments and Danya Cebus of Israel and Sesa Sterlite of India.

The recommendations actually were made back in September and November, shortly after the Conservative and Progress parties won the parliamentary election and later formed a government in October. The council advised that Africa Israel Investments and Danya Cebus had contributed to “serious violations of individual’s rights in war or conflicts” through their construction of Israeli settlements in East Jerusalem. Sesa Sterlite of India, meanwhile, is a new subsidiary of a firm banned earlier, Vedanta Resources Ltd,  and is now responsible for what the council claims is an “unacceptable risk for serious environmental damage and violations of human rights.”

For details of the exclusions from what’s officially called the Government’s Pension Fund Global, click here (external link to the ministry’s website).

The political controversy has arisen over Jensen’s acceptance of the recommendations. Her effective approval of the ban on the two Israeli companies surprised some party members, since their Progress Party is viewed as Israel’s best friend in Norway. Christian Tybring-Gjedde, a Member of Parliament for the Progress Party from its most conservative side, said he “very much disagreed” with the government’s decision. He told state broadcaster NRK that the party is “still Israel’s best friend” and he thinks the party simply had to bow to the wishes of its majority partner in the government coalition.

Israel’s ambassador to Norway, Naim Araidi, told NRK he was also disappointed over the government’s decision to ban the two Israeli companies, “because we believed in a new era in the relations between Israel and Norway.” He added that the ban was “a surprise, and we hope it was based on a mistake.” The finance ministry noted, however, that the two companies were also banned from the fund from August 2010 until August 2013.

‘Interesting turnaround’
Opposition politicians, meanwhile, seized on the opportunity to catch the Progress Party in a political compromise, since Jensen herself had criticized earlier bans on Israeli companies from the oil fund, which invests the state’s oil revenues to cover future pension demands. “This is an interesting turnaround from her side,” Marianne Martinsen, a Member of Parliament for the Labour Party, told NRK. “The last time Israeli companies were thrown out of the fund, Siv Jensen said it was an expression of anti-Israeli attitudes. She clearly doesn’t think that way anymore.”

Martinsen’s party actually supports the ban and thus Jensen’s decision, but she nonetheless noted that the oil fund’s ethics council only makes recommendations to the ministry, and that Jensen could have rejected them. “This shows how demanding it is for Frp (the Progress Party) to be in the government,” Martinsen claimed. “The Israel-friendly voters for Frp are probably disappointed by Siv Jensen.”

Jensen herself was traveling abroad and unavailable for comment. Berglund



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