The Natural Resource Fund (NRF) which held 740 million US dollars at the end of April, has yet to receive an investment mandate. Without that mandate, the fund cannot invest the money saved and this makes the fund unable to grow through interest on its investments.
In 2021 the National Pension Fund of Norway grew by 14.5% on interest earned from its investments. Index funds tied to the Dow Jones industrial index grew by 18.7% in 2021 while the Standard and Poor’s 500 indexes grew by 26.89%.
The Sovereign Wealth funds and investment funds worldwide enjoy these respectable growth rates. Guyana’s Natural Resources Fund has received a total of 0% interest from investments since it cannot make investments without an investment mandate.
The Investment mandate of the NRF is to be developed based on the work of the Investment Committee outlined in the NRF act. However, the Investment Committee is yet to be constituted. Additionally, the Investment Mandate would need to be published by the Board of Directors, which has only very recently been appointed.
Before the NRF Act was amended in late 2021, the Minister of Finance had the authority to produce the investment mandate but the PPP refused to do so. Growth is a primary objective of all SWFs, including the NRF. The PPP regime’s failure to do the necessary task of giving the NRF an investment mandate has cost Guyana billions.
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