President Trump signs an executive order to create a sovereign wealth fund that may be utilized for governmental projects and investments, including a potential acquisition of TikTok.
On Monday, President
Donald Trump issued an executive order instructing the U.S. Treasury and Commerce departments to take steps toward establishing a sovereign wealth fund.
Treasury Secretary Scott Bessent anticipates that the fund could be operational within a year. Its objective is to finance significant government projects and strategic investments, particularly in essential areas like supply chains.
Trump indicated that the fund could support substantial infrastructure initiatives, such as highways and airports, as well as contribute to advancements in defense capabilities and medical research.
The president proposed that the fund might aid in the acquisition of TikTok, suggesting it could involve either a direct purchase or collaboration with affluent individuals.
Although he did not provide specific details, he highlighted that the arrangement would need to be favorable.
Trump has previously mentioned a possible joint venture in which the U.S. might acquire a 50 percent share of TikTok, although this idea has raised legal concerns.
In addition to these potential investments, Trump's nominee for Commerce Secretary, Howard Lutnick, indicated that the sovereign wealth fund could also invest in companies with significant government contracts, including those involved in producing
COVID-19
vaccines.
This initiative comes on the heels of similar discussions among Democrats, who have also contemplated establishing a sovereign wealth fund.
Sovereign wealth funds are substantial capital pools owned by governments and have played a crucial role in global investments, especially in the Middle East and Europe.
However, uncertainties persist regarding how the timeline for the new U.S. fund aligns with the ongoing efforts to resolve the situation surrounding TikTok, which faces national security scrutiny.
The White House has yet to provide additional information about the executive order.