President Donald Trump has signed an executive order directing the US to take steps to start developing a government-owned investment fund that he said could be used to profit off TikTok if he is successful at finding it an American buyer.
Mr Trump signed an order on his first day in office to give TikTok until early April to find an approved partner or buyer, but he’s said he’s looking for the US to take a 50% stake in the massive social media platform.
Speaking in the Oval Office, Mr Trump said that TikTok, which is owned by China-based ByteDance, was an example of what he could put in a new US sovereign wealth fund.
Sovereign wealth funds invest in assets, such as stocks, bonds and real estate. They are typically funded by a country’s budgetary surpluses, which the US currently does not have.
Mr Trump noted many other nations have such investment funds and predicted that the US could eventually top Saudi Arabia’s fund size.
“Eventually we’ll catch it,” he promised.
There are more than 90 sovereign wealth funds around the world that manage more than eight trillion dollars in assets, according to The International Forum of Sovereign Wealth Funds, a London-based organisation made up of roughly 50 of these entities.
In the US, more than 20 sovereign wealth funds exist at the state level, according to analysis from the Centre for Global Development, a Washington-based nonpartisan think-tank.
Though these funds are owned by governments, they tend to operate as standalone institutions with their own investment strategies and staff, the centre said.
The president put Treasury Secretary Scott Bessent and Howard Lutnick, Mr Trump’s pick for commerce secretary, in charge of laying the groundwork for creating the fund, which would likely require congressional approval.
The executive order says a plan for the fund — including recommendations for investment strategies and a governance model — has to be submitted to Mr Trump within 90 days.
Former President Joe Biden’s administration had studied the possibility of creating a sovereign wealth fund for national security investments, but the idea did not yield any concrete action before he left office last month.
Mr Bessent said the administration’s goal was to have the fund open within the next 12 months, while Mr Lutnick said another use of the fund could have been for the government to take a profit-earning stake in vaccine manufacturers.
“The extraordinary size and scale of the US government and the business it does with companies should create value for American citizens,” Mr Lutnick told reporters.
The law was passed in April with bipartisan support in Congress and signed by Mr Biden. The two companies and some users quickly took legal action against the statute, which was ultimately upheld by the Supreme Court last month.
After taking office, Mr Trump, who had attempted to ban the popular app during his first term, directed the Justice Department to pause enforcement of the law for 75 days. The reprieve has given the company more time to work out a deal with the administration.
Several investors — including billionaire Frank McCourt and Mr Trump’s former Treasury Secretary Steven Mnuchin — have spoken publicly about their desire to purchase TikTok’s US platform.
Mr Trump has said “many people” had also reached out to him privately about it. Last week, he said Microsoft was one of the US companies eyeing the social media platform.
