Softbank Group Corp founder Masayoshi Son has proposed setting up a US-Japan sovereign wealth fund aimed at making large investments in technology and infrastructure, the Financial Times reported, citing three unidentified people close to the situation.
Son has discussed the plan with US Secretary of the Treasury Scott Bessent, although it has not been formally proposed, the report said.
The joint fund would likely need about US$300 billion in initial capital, with significant leverage, to be effective, one person told the Financial Times.
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The fund would be jointly owned and run by the US Department of the Treasury and the Japanese Ministry of Finance, with each holding a significant stake, the report said.
The fund could also be opened to limited partner investors, potentially offering retail investors in Japan and the US a chance to participate.
Bessent has been looking for revenue streams for the US Treasury that do not involve raising taxes, and the fund could potentially provide a solution, a person briefed on the situation told the newspaper.
However, Bessent on Friday said US President Donald Trump paused plans to create a sovereign wealth fund as the president prioritizes paying down the national debt.
“I think the president has decided it’s on pause while we work on everything else that we’re doing now,” Bessent said in an interview on Bloomberg Television’s Wall Street Week with David Westin. “He said the other day that we’ll probably spend more time paying down debt. He is laser-focused on paying down debt.”
Trump in February ordered a plan to create one of the biggest such funds in the world, suggesting it could be backed by monetizing government assets and used for strategic investments including critical minerals projects or stakes in companies such as TikTok.
Bessent at the time said that the fund could be up and running in 12 months.
However, the ambition has slid down the list of priorities after running into legal, financial and political realities. Instead, the administration is pivoting to a potentially simpler and limited investment vehicle using existing agencies that would not need congressional approval.
Bessent and US Secretary of Commerce Howard Lutnick, who Trump tasked with coming up with the proposal within 90 days, submitted their ideas earlier this month, but White House officials were not satisfied and a final plan was not presented to Trump for approval, people familiar with the situation said.
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