Nationalizations Get Another Look: Nicholas Mulder

Nationalization has re‑emerged as governments confront heightened geopolitical risk and climate‑driven energy insecurity. Nicholas Mulder points to recent moves in Western Europe—Germany’s 2022 takeover of Uniper, France’s full ownership of EDF, and Belgium’s plan to nationalize nuclear plants—as well as Latin American actions in Chile and Mexico to place lithium under state control. These sectors are critical for the renewable‑energy transition, and the urgency of securing supply chains has made state ownership appear more acceptable than in the neoliberal era of the 1990s.

Mulder stresses that state ownership works best where natural monopolies exist and democratic oversight is strong. Norway’s oil fund illustrates how transparent institutions can turn public resources into long‑term prosperity, while many developing nations in the 1970s suffered debt crises after costly buy‑outs of private investors. Poor governance can turn nationalized assets into rent‑seeking liabilities, as seen in former oil‑rich states with corruption. Conversely, essential services that are unprofitable for private firms—such as remote broadband in Canada—often require government intervention to ensure universal access.

The new wave reshapes investment strategy. Governments are tightening foreign‑investment screening and favoring public‑private joint ventures, especially in sectors like manufacturing, pharmaceuticals, and advanced technology. While energy and food commodities remain vulnerable to further nationalization, consumer goods and digital services stay relatively open. Mulder advises investors to diversify across regions and to anticipate state security considerations when allocating capital. By partnering with sovereign entities or targeting markets with robust institutional frameworks, firms can navigate the evolving landscape while benefiting from the stability that state‑backed assets may provide.