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Norway sets plan to invest oil wealth ethically

The fund holding Norway's vast oil wealth would shun investments in some weapons makers and firms suspected of gross human rights violations under ethical guidelines proposed by the government on Tuesday.

The fund holding Norway's vast oil wealth would shun investments in some weapons makers and firms suspected of gross human rights violations under ethical guidelines proposed by the government on Tuesday.

The new guidelines for the Petroleum Fund, saving oil and gas wealth for future generations, would seek to ensure "respect for the fundamental rights" of people affected by the investments, the Finance Ministry said.

The Petroleum Fund, expected to top 1.01 trillion Norwegian crowns ($147.6 billion) by the end of 2004, is a giant pension plan for the nation's 4.5 million population and one of the world's biggest funds.

As part of the new guidelines, Norway would bar investments in makers of arms including chemical or biological weapons, anti-personnel mines, blinding laser weapons and cluster bombs.

It would also exclude companies which were judged to be at unacceptable risk of contributing to gross violations of human rights, gross corruption or severe environmental degradation.

The fund sold out of Singapore-based Singapore Technologies Engineering in 2001 after finding that it was involved in making anti-personnel mines.

Some opposition parties have urged Norway to go much further, for instance banning investments in tobacco companies or all arms makers.

The proposals by the minority centre-right government would be debated in parliament before entering into force, probably sometime in the second half of the year.

Under the plan, a five-member panel would be set up to review the more than 2,000 companies in which Norway invests and pull out of investments in any firms found to be breaching the guidelines.

The fund invests roughly 60 percent of its cash in foreign equities and 40 percent in bonds. Norway is the world's number three oil exporter behind Saudi Arabia and Russia.