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Robust growth in Norwegian economy

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Christian Fernsby |
Robust growth in Norwegian economy
Europe   The positive developments are expected to continue

The Norwegian economy is performing well.

Employment growth is high and unemployment has declined across the country.

Non-oil business investment is at a 10-year high.

The positive developments are expected to continue.

In the Revised national budget the Government continues an economic policy that facilitates structural adjustment, innovation and growth in the Norwegian economy.

“Unemployment has come down across the country, and an increasing share of the population is in work.

“I am pleased to see that four out of five new jobs have been created in the private sector.

“This improves the sustainability of our welfare state,” says Finance Minister Siv Jensen.

Growth in the Norwegian economy is robust.

In the Revised budget for 2019 GDP for Mainland Norway is projected to increase by 2.7 per cent this year and 2.5 per cent next year, which is higher than the long-term trend estimate of around 2 per cent, see table 1.

Given the robust growth in the Norwegian economy, the government has held back public expenditure in recent years.

“The fiscal policy stance has facilitated growth in the economy and new jobs in the private sector,” says Finance Minister Siv Jensen.

In the 2019 budget, the Government continued its emphasis on transport, research and education, and growth-enhancing tax reductions, within responsible limits.

These policies will allow the positive developments in the Norwegian economy to continue.

The revision of the budget includes increased expenses for defence related to the sinking of the frigate KMN Helge Ingstad, additional funds to the police as well as the Norwegian Police Security Service in order to prevent and combat crime, and increased spending on measures to reduce the effects of climate change.

The budgetary impulse for 2019, which in the autumn of last year was estimated at close to zero, is now estimated at 0.5 per cent of non-oil GDP.

The upward revision is primarily due to expenditure being lower than expected in the previous year, and consequently a substantial negative revision of the impulse for 2018.

“If we consider 2018 and 2019 as a whole, the fiscal policy stance is broadly neutral,” says Finance Minister Siv Jensen.


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