United Kingdom Chancellor Rachel Reeves has announced a new $9.37 billion National Wealth Fund (NWF) to reduce greenhouse gas emissions from heavy industry by investing in areas like green steel and gigafactories, reported The Guardian.
The fund is part of a push by the new Labour government to raise billions in private sector funds for infrastructure projects.
Reeves said the NWF would be established “in less than a week” to assist projects like ports and hydrogen in attracting a combination of investments with the goal of raising approximately $3.85 in private monies for every $1.28 of taxpayer funds.
Reeves described the NWF as a “concierge service for investors and businesses that want to invest in Britain, so they know where to go.”
Management of the investments will be handled by the UK Infrastructure Bank, with support from the British Business Bank.
Reeves said the NWF will be distinct from GB Energy, another Labour-proposed, publicly owned company. The focus of GB Energy will be on the “production of clean, low carbon energy,” while NWF’s investments will aim to use $3.21 billion for green steel, $2.31 billion for ports, $1.93 billion for gigafactories — which includes electric vehicles — $1.28 billion for carbon capture and $642.3 million for green hydrogen.
“Our Mission to make Britain a clean energy superpower is about investing in Britain. Our National Wealth Fund will help create thousands of jobs in the clean energy industries of the future to boost our energy independence and tackle climate change,” said Ed Miliband, secretary of energy security and net zero, in a UK government press release.
Reeves said the UK was in a good position to attract investors, as other western economies — like the United States with its upcoming election and France with a currently hung parliament — are in the midst of political uncertainty, The Guardian reported.
“I think for the first time in a long time investors will look at Britain and say it’s a country with a stable government. It’s got a clear plan, but clear mandate in the election. And that’s different from some other countries around the world today,” Reeves told journalists, as reported by The Guardian.
The NWF will soon become UK law, according to the Treasury.
On a call with more than 170 UK business and trade leaders on Tuesday, business and trade secretary Jonathan Reynolds outlined four main priorities to become the foundation of the UK’s growth mission, according to a source from the department: support of small businesses, promoting British exports, resetting trade relations and making work pay.
“The National Wealth Fund will reshape the way we approach public, private risk-sharing, providing private investors with the confidence needed to fund the technologies and infrastructure needed to drive growth and create new jobs across the UK,” said Dr. Rhian-Mari Thomas, taskforce chair and Green Finance Institute CEO, in the press release.
Reynolds acknowledged that connectivity and the grid was a big challenge for businesses and explained that the decarbonization of industry did not translate to deindustrialization, The Guardian reported.
“Britain is open for business – and the work of change has begun,” Reeves said in the press release.
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