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President Donald Trump on Monday signed an executive order directing the Treasury and Commerce departments to take steps to form a sovereign wealth fund that could be used to fund new government projects and investments — including a possible acquisition of TikTok.
“Other countries have sovereign wealth funds. They’re much smaller countries. They’re not the United States,” Trump said in the Oval Office. “We’re going to be doing something perhaps with TikTok. Perhaps not. if we make the right deal we’ll do it … Or if we make a partnership with very wealthy people.”
The new wealth fund, which Treasury Secretary Scott Bessent told reporters could be formed in the next 12 months, could be used to finance major government projects and fund strategic investments in critical areas like supply chains. Sovereign wealth funds in the Middle East and Europe are among the largest institutional investors in the world, providing massive pools of capital for Wall Street firms and the U.S. tech industry.
Text of the order was not immediately available. The White House did not respond to a request for comment.
During the campaign, Trump said a U.S. fund could be used to fund highways, airports and other transportation infrastructure. He also said in an Economic Club of New York speech that the vehicle could be invested in “state-of-the-art manufacturing hubs, advanced defense capabilities, cutting edge medical research and help save billions of dollars in preventing disease in the first place.”
Trump’s nominee for Commerce Secretary Howard Lutnick told reporters at the signing that the sovereign wealth fund could be used to hold securities in companies that have large contracts with the U.S. — citing the mass purchases of Covid-19 vaccines as an example.
“Maybe we should have some warrants and some equity in these companies,” Lutnick said.
Democrats have also floated the creation of a sovereign wealth fund in the past as well. Biden administration officials were reportedly exploring the creation of a vehicle last year.
Trump’s idea of using the fund to buy TikTok built off his earlier mention of a joint venture that gives the U.S. a 50 percent stake in the app. That proposal left lawmakers baffled and worried about its legality.
Bessent’s 12-month timeline raised questions about how it would fit with Trump’s executive order giving TikTok a 75-day reprieve while he tries to broker a deal for the app’s sale. Trump has said he’d like billionaire allies including Elon Musk and Oracle cofounder Larry Ellison to purchase TikTok, and he has told reporters that Microsoft is in talks about an acquisition.
