For those investment planning in Cheshire and elsewhere in the UK, the Government’s National Wealth Fund (NWF) may be of interest.
First announced in July, it is now a major component in the drive to push economic growth, increase foreign investment and create further employment opportunities.
The initial capital target is £27.8 billion, and this will be accompanied by legislation permitting the NWF to invest in asset classes beyond the infrastructure sphere.
The NWF announced last month that is providing financial guarantees to Lloyds Banking Group and Barclays UK Corporate Bank to the funding tune of £1 billion, in order to retrofit social housing across the UK.
Unlike the sovereign funds driven by natural resources, surpluses and other reserves in countries such as Norway or Saudi Arabia, the NWF is operating as a policy bank. This means that it invests to help deliver government goals, financed by borrowing or taxation.
The Government has been inspired by similar schemes in France, Germany and Canada, where governments are ready to step in to share the risk of investment in longer-term infrastructure projects, thus reassuring investors.
According to the New Economics Foundation, the NWF’s business model could generate £100 billion of private finance to support investment projects, with a heavy focus on green tech industries and gigafactories. In conjunction with investments from pension funds, it is hoped that this money will help rectify the regional and structural disparities in the UK, enabling political leaders at all levels to deploy capital effectively in major investment projects.
