Introduction Øystein Olsen

The fund is a tool for ensuring that future generations also benefit from Norway’s petroleum wealth. The government only spends the expected return on the fund in its budget each year.

At the end of 2010, the fund’s market value was 3,077 billion kroner. Under the government’s fiscal rule, petroleum revenue spending must not exceed 4 percent of the fund’s value. This corresponds to 123 billion kroner, or 13 percent of the government’s total non-oil expenditure, in 2011. The fund therefore plays an important role as a source of revenue in fiscal policy.

It is easier to win support for this fiscal policy strategy whenthe political authorities and the public are confident that Norges Bank is managing the fund in a professional and ethical manner. Not least, such confidence depends on disclosure of key information about how the fund is managed.

The fund is entirely invested outside Norway. As a foreign investor, we are guests at another’s table. When a representative of the Norwegian government becomes a major investor in another country, this can create uncertainty. It is important for the fund’s investment opportunities that our capital continues to be welcome. Openness about rules and strategies will help reassure our hosts of our intentions. The perception of the fund is important for the fulfilment of our mandate in global capital markets.

The larger the fund grows, the greater the demands for transparency will be, from both Norwegian and foreign stakeholders. It is therefore natural for us to publish more and more information. Last year, we began to publish a continuously updated market value for the fund on our website, www.nbim.no.

With this annual report, we are taking further steps in the direction of increased transparency. Greater detail is being provided in the accounts, which will be prepared in accordance with International Financial Reporting Standards (IFRS) from the first quarter of 2011. There is more extensive and in-depth risk analysis than before. NBIM’s strategy plan is also being published and a number of other policy documents will follow during the spring.

The fund produced good results again in 2010, with a return of 13.3 percent in global equity markets and 4.1 percent for fixed income. As in 2009, the results demonstrate the value of the fund’s owners adhering to the long-term strategy even in times of financial crises and major declines in securities markets.

Oslo, 2 March 2011

Øystein Olsen

Chairman of the Executive Board