U.S. President Donald Trump signed an order on Monday to create a sovereign wealth fund for the United States within the next year. According to Reuters, Trump suggested this fund could even buy TikTok, the popular video app.
However, he didn’t explain how the fund would work or where the money would come from. Sovereign wealth funds are usually built using a country’s extra savings, but the U.S. currently spends more than it earns, making the idea unusual.
Trump told reporters, “We’re going to create a lot of wealth for the fund,” adding that it’s time for the U.S. to have its own sovereign wealth fund. He first proposed this idea during his 2016 campaign, saying it could fund big projects like highways, airports, and medical research.
Treasury Secretary Scott Bessent said the fund would be set up in 12 months and would use U.S. assets to benefit the American people. However, Reuters notes that creating such a fund would likely need approval from Congress, which could be a challenge.
The idea of a U.S. sovereign wealth fund isn’t entirely new. The Biden administration had also considered it before Trump’s election, according to reports from The New York Times and Financial Times. Still, investors were surprised by Trump’s announcement.
Colin Graham, an investment expert, told Reuters that sovereign wealth funds usually come from countries with extra savings, which the U.S. doesn’t have.
There are over 90 such funds worldwide, managing more than $8 trillion, but the U.S. has never had one.
In a surprising twist, Trump suggested the fund could buy TikTok, whose future has been uncertain since January. A U.S. law requires TikTok’s Chinese owner, ByteDance, to sell the app or face a ban due to national security concerns.
Trump delayed this decision by 75 days and said he’s talking to potential buyers. TikTok has about 170 million users in the U.S., making it a hot topic. Trump said, “We might put TikTok in the sovereign wealth fund if we make the right deal.”
Reuters highlights that Trump’s plan raises many questions, especially about how the fund would be funded. Trump mentioned using tariffs and other methods, but experts are skeptical.
The idea of a U.S. sovereign wealth fund is bold, but without clear details, it’s hard to say if it will happen. For now, the focus remains on TikTok’s fate and whether Trump’s fund will become a reality.
Credit : Reuters