In an executive order issued Monday, President Donald Trump instructed the United States to begin creating a government-owned investment fund that, if he is successful in finding an American buyer for TikTok, could be used to finance the company’s growth.
On his first day in office, Trump issued an order giving TikTok until early April to find a buyer or partner that he approves of, but he has stated that he wants the United States to own 50% of the huge social media site.
Laptops 1000He stated in the Oval Office on Monday that he could include TikTok, which is controlled by ByteDance, a Chinese company, in a new U.S. sovereign wealth fund.
Regarding TikTok, he stated, “We might put that in the sovereign wealth fund; whatever we make, or we do a partnership with very wealthy people, there are a lot of options.”
“But we could put that as an example in the fund. We could contribute a lot more items to the fund.
Real estate, stocks, and bonds are among the assets that sovereign wealth funds invest in.
Usually, they are financed by a nation’s budget surpluses, which the US does not currently have.
Trump noted many other nations have such investment funds and predicted that the U.S. could eventually top Saudi Arabia’s fund size. “Eventually we’ll catch it,” he promised.
The International Forum of Sovereign Wealth Funds, a London-based organization composed of over 50 sovereign wealth funds, estimates that there are over 90 sovereign wealth funds managing over $8 trillion in assets worldwide.
Analysis from the Center for Global Development, a nonpartisan think tank based in Washington, indicates that there are over 20 sovereign wealth funds at the state level in the United States.
The largest, which are situated in Alaska, New Mexico, and Texas, are funded by oil, gas, and mineral revenues and utilized to support in-state initiatives like education.
According to the center, despite being government-owned, these funds often function as independent organizations with their own personnel and investment plans.
The president assigned Howard Lutnick, Trump’s choice for commerce secretary, and Treasury Secretary Scott Bessent to set the foundation for the fund’s establishment, which would probably need congressional approval.
According to the executive order, Trump must receive a strategy for the fund within ninety days, which must include suggestions for investment methods and a governance mechanism.
Prior to his departure last month, former President Joe Biden’s administration had considered the notion of setting up a sovereign wealth fund for investments in national security, but no real progress had been made on the matter.
The administration’s objective, according to Bessent, was to launch the fund within the next 12 months. Lutnick stated that the government might have used the money to acquire a profitable stake in vaccine producers.
“American citizens ought to benefit from the exceptional size and scope of the U.S. government and the business it conducts with businesses,” Lutnick told reporters.
Last month, TikTok was set to be outlawed in the United States because of a federal statute that requires ByteDance to sell off its shares or risk being blacklisted.
Biden signed the legislation after it was enacted by Congress in April with bipartisan backing. The Supreme Court upheld the statute last month after the two corporations and a few consumers swiftly filed a lawsuit against it.
After taking office, Trump, who had tried to outlaw the well-known app during his first term, ordered the Justice Department to put the law on hold for seventy-five days.
This reprieve has allowed the business additional time to negotiate with the administration.
Trump’s former Treasury Secretary Steven Mnuchin and billionaire Frank McCourt are among the investors who have openly expressed their interest in acquiring TikTok’s U.S. platform.
According to Trump, “many people” had also contacted him personally about it.
He claimed last week that Microsoft was among the American businesses interested in the social media network.
Perplexity AI, an artificial intelligence startup based in San Francisco, submitted a proposal to ByteDance last month that would permit the U.S. government to own up to 50% of a company that merges Perplexity’s operations with TikTok’s U.S. platform.
If the plan is approved, the U.S. government would be able to own a significant portion of that company when it raises at least $300 billion through an IPO.
