Norwegian industrial confidence dips

As Europe's debt crisis intensifies, Norwegian industry has admitted its lowest expectations since the dire months after the credit crunch of 2008 spilled into 2009.

Norwegian industrial confidence dips
Photo: Erik Söderström (File)

A key industrial activity indicator, the Norwegian Purchasing Manager Index, was said by Fokus Bank on Thursday to indicate a steep fall from October of 1.6 points to 48.6 points in November. A reading below 50 points indicates contraction.

“This is foremost a fall in staffing and the order index being pulled down,” Fokus chief economist, Frank Jullum, said in a statement.

He said the development wasn’t all bad, as production numbers were up in the third quarter. He did warn, however, that orders alone were down almost three points since the start of October, and were at their lowest levels since autumn 2009.

For the export-driven Norwegian economy, the drop in orders points squarely at crisis-hit Europe and the slowing economic engine, China.

Despite bank-funding action from Europe on Wednesday that energized markets in mixed economies, Oslo's stock exchange slumped and opened flat on Thursday. The order dip suggests European banks focused on buying local debt and supporting the euro are not lending to customers buying high-capital Norwegian items.

China, normally a big buyer of Norwegian farmed fish, has turned away since the Norwegian Nobel Committee handed the 2010 Nobel Peace Prize to a dissident. Now, Chinese production has fallen for the first time in 32 months, the bank’s PMI figures show.

Lower orders of big-ticket goods from Norway — like ship and rig gear — could also fall, although the Norwegian government has promised cheaper export finance to back such orders.

The government acted swiftly (and some say hastily) to shore up orders for Norwegian wares, but may be too late to stave off a spike in unemployment. The Fokus Bank numbers also show the staffing index was down nearly three points to 44.7 points, a number the lender’s analysts believe suggest falling employment numbers for the rest of the year.

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‘We agree to disagree’: Still no progress in marathon SAS strike talks

By lunchtime on Friday, talks between the Scandinavian airline SAS and unions representing striking pilots were still stuck on "difficult issues".

'We agree to disagree': Still no progress in marathon SAS strike talks

“We agree that we disagree,” Roger Klokset, from the Norwegian pilots’ union, said at lunchtime outside the headquarters of the Confederation of Swedish Enterprise in Stockholm, where talks are taking place. “We are still working to find a solution, and so long as there is still some point in continuing negotiations, we will do that.” 

Mats Ruland, a mediator for the Norwegian government, said that there were “still several difficult issues which need to be solved”. 

At 1pm on Friday, the two sides took a short break from the talks for lunch, after starting at 9am. On Thursday, they negotiated for 15 hours, breaking off at 1am on Friday morning. 

READ ALSO: What’s the latest on the SAS plane strike?

Marianne Hernæs, SAS’s negotiator on Friday told journalists she was tired after sitting at the negotiating table long into the night. 

“We need to find a model where we can meet in the middle and which can ensure that we pull in the income that we are dependent on,” she said. 

Klokset said that there was “a good atmosphere” in the talks, and that the unions were sticking together to represent their members.

“I think we’ve been extremely flexible so far. It’s ‘out of this world’,’ said Henrik Thyregod, with the Danish pilots’ union. 

“This could have been solved back in December if SAS had not made unreasonable demands on the pilots,” Klokset added. 

The strike, which is now in its 12th day, has cost SAS up to 130m kronor a day, with 2,550 flights cancelled by Thursday, affecting 270,000 passengers.