Business Environment in Norway
After fifteen years of a strong growth (more than 5% in average annually), Norway has been touched by the global economy recession; however, the decline in production was less severe than in other countries. In 2009, the growth was slightly negative (-1.4%), a limited contraction by the rebound of oil prices. The growth rate has slightly increased in 2010, stimulated by the relaunching measures, household consumption and private investment. This slow revival trend should continue in 2011.
Even though, Norway strongly depends of oil prices, the Norwegian economy is very solid and its perspectives are positive. The government has progressively suppressed the exceptional measures taken during the crisis in order to prevent overheating its economy. As it was announced on the budget 2011, the priority is to reduce the public deficit (without including oil). Confronting a long-term challenge, which is the ageing of the population, the government has also introduced a reform on the retirement insurance system.
Norway is a rich country, which has the second highest GNP per capita in the world (USD 55,600 in terms equivalent to purchasing power). The country also ranks second place in the UNDP's Human Development Index. Contrary to the initial fears, unemployment was controlled during the crisis and it has been stable at a very low rate (3.5% of the active population).
|GDP (billions USD)||378.61||414.46||478.96||494.24||504.90|
|GDP (Constant Prices, Annual % Change)||-1.4||0.4||2.9||2.5||2.2|
|GDP per Capita (USD)||78,183||84,444e||96,811||99,106||100,439e|
|General Government Balance (in % of GDP)||-6.0e||-6.5||-6.4||-6.4||-6.5|
|Inflation Rate (%)||2.2||2.4||1.8e||2.2||2.5|
|Unemployment Rate (% of the Labor Force)||3.2||3.6e||3.6e||3.5e||3.5e|
|Current Account (billions USD)||52.90||72.86||74.38||73.87e||-|
|Current Account (in % of GDP)||13.8e||16.8||16.7||16.2||-|
Source: IMF - World Economic Outlook Database
Note: (e) Estimated Data
Main Sectors of Industry
Agriculture contributes to about 2% of the GNP. Fishing is a very important activity, Norway is one of the biggest exporters of fish in the world. Government subsidies for agriculture are very considerable.
Norway's economy is essentially based upon the exploitation of its natural and energy resources (oil, gas, hydroelectric power, forests and minerals). Oil production dominates the economy, accounting for nearly a quarter of the GNP. Norway is also a major producer and exporter of natural gas. There is a consensus among the political parties to save oil and gas revenues for future generations, to the point where Norway has one of the largest sovereign wealth funds in the world. Shipbuilding, metals, pulp and paper, chemical industries, machinery and electrical equipment are Norway's main manufacturing industries. Norway has one of the biggest and most modern fleet in the world.
The services sector is highly developed and accounts for more than three-fourths of the GNP.
|Breakdown of Economic Activity By Sector||Agriculture||Industry||Services|
|Employment By Sector (in % of Total Employment)||2.8||21.1||76.0|
|Value Added (in % of GDP)||1.2||40.1||58.7|
|Value Added (Annual % Change)||-5.1||-2.5||-0.6|
Source: World Bank - Last Available Data.
|Norwegian Krone (NOK) - Average Annual Exchange Rate For 1 USD||6.44||6.41||5.86||5.64||6.29|
Source: World Bank
Indicator of Economic Freedom
- Mostly free
- World Rank:
- Regional Rank:
Foreign Trade in Figures
Norway has a widely open economy, trade represents almost 75% of the GDP (during the period 2007-2009).
Traditionally, the country exports energy-intensive products and imports technology-intensive products. Its main trade partners are the countries of the European Union.
The country is the third largest exporter of oil in the world, the largest supplier of natural gas to the the countries of Western Europe, the largest exporter of fish in the world. Overall, Norway is classified among the 30 largest exporters of the world. The industrial products (ships, oil platforms, etc.) constitute nearly 10% of total exports. Norway mainly imports manufactured merchandise (machines, transporters, information technology) which accounts for 40% of its total imports.
The surplus in the trade balance is enormous. The country's trade balance is structurally positive and this trend should continue during the next following years.
|Foreign Trade Indicators||2006||2007||2008||2009||2010|
|Imports of Goods (million USD)||64,261||80,297||90,293||69,292||76,902|
|Exports of Goods (million USD)||122,208||136,354||172,621||120,880||131,683|
|Imports of Services (million USD)||31,135||38,753||43,990||36,291||40,639|
|Exports of Services (million USD)||33,057||40,196||44,810||38,261||40,191|
|Imports of Goods and Services (Annual % Change)||8.4||8.6||4.3||-11.4||-|
|Exports of Goods and Services (Annual % Change)||0.4||2.8||-||-||-|
|Imports of Goods and Services (in % of GDP)||28.4||30.4||29.2||27.3||-|
|Exports of Goods and Services (in % of GDP)||46.4||45.8||48.1||42.0||-|
|Trade Balance (million USD)||59,856||60,271||86,472||54,405||-|
|Trade Balance (Including Service) (million USD)||61,227||61,105||88,749||-||-|
|Foreign Trade (in % of GDP)||74.8||76.2||77.3||69.4||-|
Source: WTO - World Trade Organization ; World Bank
Main Partner Countries
(% of Exports)
|Other partnersClose extended list||36.2%|
(% of Imports)
|Other partnersClose extended list||52.9%|
Sources of General Economic Information
Ministry of Agriculture and Food
Ministry of Trade and Industry
Ministry of Foreign Affairs
- Statistical Office
Central Office for Statistics
- Central Bank
Central Bank of Norway
- Stock Exchange
- Search Engines
- Economic Portals
Portals to the World: Norway
Bedin - Establishing and running business in Norway
- Executive Power
- The constitution grants executive powers to the King (the head of state), but these are exercised by the cabinet. King serves a ceremonial role with some reserve powers. After elections the majority leader is usually appointed Prime minister (the head of the cabinet) by the monarch with the approval of the parliament.
- Legislative Power
- A modified unicameral parliament or Storting. For certain purposes the parliament divides itself into two chambers called Lagting and Odelsting, but the practice will be abolished after the general elections in 2009 making Storting fully unicameral. Members are elected for four-year terms according to a system of proportional representation.
- Main Political Parties
DNA (Norwegian Labour Party) - Social democrats
- FrP (Progress Party) – Libertarian right-wing party
- Høyre (Conservative Party) - Conservatives
- Venstre (Liberal Party) – Social liberals
- KrF (Christian Democratic Party)
- SV(Socialist Left Party) - Socialists.
- SP (Centre Party) - Centrist and agrarian party.
Labour Party, Socialist Left and the Centre Party form the current cabinet. Coalition governments of several parties are typical in Norway.
- Current Political Leaders
- King: HARALD V (since January 1991) - hereditary
Prime Minister: Jens STOLTENBERG (since October 2005) – DNA
- Next Election Dates
- Parliamentary: September 2013
Indicator of Freedom of the Press
- World Rank:
- 1 place down compared to 2008
Indicator of Political Freedom
- Political Freedom:
- Civil Liberties:
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