Norway’s deputy central bank governor with responsibility for the world’s largest sovereign wealth fund has been forced to resign due to security concerns over his Chinese wife.
Jon Nicolaisen, who has had special responsibility for Norway’s $1.2tn oil fund at the central bank for the past eight months but has been deputy governor since 2014, resigned on Friday as he was declined a renewed security clearance.
“The Norwegian Civil Security Clearance Authority informs me that the reason that I will not receive a renewed security clearance is that my wife is a Chinese citizen and resides in China, where I support her financially,” Mr Nicolaisen said.
Mr Nicolaisen married his wife in 2010. Norges Bank did not immediately comment on when he last received a security clearance.
The resignation is significant because Mr Nicolaisen only just took over supervision of the world’s largest sovereign wealth fund, which on average owns 1.5 per cent of every listed company in the world. His first months in charge were dominated by a heated political debate over the decision of Norges Bank to hire ex-hedge fund manager Nicolai Tangen as chief executive of the manager of the oil fund.
Relationships between Norway and China have also been tense since Chinese dissident Liu Xiaobo won the Nobel Peace Prize in 2010. Commercial and diplomatic ties were cut, and the current centre-right government in Oslo worked hard to restore links to China, culminating in a deal in late 2016.
Mr Nicolaisen said that Norwegian authorities “have determined that there are no circumstances regarding me personally that give rise to doubt about my suitability for obtaining a security clearance, but that this does not carry sufficient weight”.
His resignation was accepted by Norway’s finance ministry, which will now search for a new deputy governor.
Some experts on the oil fund had grumbled privately in April that Mr Nicolaisen had no asset management experience and thus was ill-suited to overseeing such a large investor.
The job of deputy governor with special responsibility for the oil fund was only created in 2015. Egil Matsen, the first to have the job title, unexpectedly resigned after only four years of his six-year tenure last December.
Governor Oystein Olsen said he would miss Mr Nicolaisen, and added: “He performed his duties superbly as a close colleague and competent professional. In his key positions at the bank, he has over the years made an essential contribution to the development of Norges Bank”.
Norway’s intelligence services singled out China and Russia as the two biggest threats to the Scandinavian country this February in its annual assessment of security challenges.