Norway is exploring ways to significantly increase its financial and military support for Ukraine by leveraging its massive €1.7 trillion sovereign wealth fund, according to Euractiv.
The urgency for increased support follows a contentious meeting between former US President Donald Trump and Ukrainian President Volodymyr Zelensky, during which the Trump administration reportedly considered cutting off military supplies to Ukraine. With the US potentially scaling back its assistance, European nations are under pressure to fill the gap.
Norway, which has already committed €14.7 billion in support to Ukraine until 2030, is now being urged to do more. Political leaders are also pushing for a dramatic increase in support. Guri Melby, leader of the Liberal Party, emphasised that Norway is one of the few countries with significant financial resources at its disposal.
Norway is one of the few countries that has large amounts of money readily available, and we must therefore multiply our support for Ukraine immediately.
Former Prime Minister Erna Solberg, a Conservative, echoed this sentiment, saying that Norway’s support should be increased “significantly” and “fast.” She added that there is broad parliamentary support for such measures.
Meanwhile, Sylvi Listhaug, leader of the conservative Progress Party, suggested that Norway should increase its defence spending to 3% of GDP by 2030, up from the current 2%.
Norway’s sovereign wealth fund, fueled by profits from oil and gas exports, is a key resource for potential increased aid. The fund includes an estimated €109 billion in war-related profits from elevated gas prices in 2022 and 2023.
One proposal under discussion is to convert €300 billion of the fund’s €450 billion in liquid bonds into European defence bonds, with the condition that the funds be used exclusively to bolster Europe’s defence capabilities. The idea has gained traction as Norway seeks to play a more active role in ensuring regional security.
However, Finance Minister Jens Stoltenberg, a former NATO secretary general, has cautioned against breaking Norway’s long-standing budgetary rule, which limits annual spending from the sovereign fund to 3% of its total value.
It is a dangerous idea to break the budgetary rule to give more money to Ukraine.
The coming weeks will be critical as the government and parliament finalise their plans to address the escalating crisis.
