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Norway to tap more oil fund as growth slows

Norway’s right-wing government has decided to tap more of its gigantic oil fund this year, predicting that the ongoing slump in the oil industry will mean lower tax revenues and higher spending on unemployment benefit.

Norway to tap more oil fund as growth slows
Statoil's Oseberg A facility. Photo: Harald Pettersen/Statoil
It’s out-take, at just 2.6 percent of the value of the $890bn fund, is nonetheless well within the country’s self-imposed limit of 4 percent.   
 
In an announcement on Tuesday the government said that money drawn from the oil fund would now contribute 168.8bn kroner ($22.4bn) to the budget in 2015, a 5bn kroner ($600m) increase on the amount announced last year. 
 
The country’s finance minister, Siv Jensen, said that while the economy was slowing, it was still healthy. 
 
“There is no crisis in the Norwegian economy, but we estimate slightly lower growth than we did in the budget for 2015.” 
 
According to the finance ministry’s latest estimates, Norway’s GDP (with the offshore oil sector excluded) will slow to 1.3 percent this year from last year's 2.3 percent. 
 
The government estimates that the slow down will lose it some $10bn in tax revenues. 
 
But Jensen stressed that she would not resort to fiscal stimulus to counteract the slow down. 
 
“Competitive businesses must adapt to lower demand from the Norwegian petroleum sector,” she said. “These adjustments are likely to happen earlier than previously anticipated due to the oil price decline.”
 

OSLO

Today in Norway: A roundup of the latest news on Wednesday

Find out what's going on in Norway on Wednesday with The Local's short roundup of important news.

Today in Norway: A roundup of the latest news on Wednesday
Trondheim harbour. Photo by Carlo Alberto Burato on Unsplash

Norway passes 2 million vaccines administered
Norway has now administered more than 2 million vaccines in total, health authorities have announced.

According to the Norwegian Institute of Public Health, the Nordic country passed the landmark on Tuesday evening.

Since the first vaccine dose was given on December 27th, 2020, Norway has administered 2,019,546 doses of a coronavirus vaccine.

READ MORE: Norway to offer everyone second Covid-19 vaccine by end of August

So far, 1,503,794 people have received their first dose, and 515,752 people have received their second dose.

“I want to say a big thank you to all those who are out in the municipalities and who ensure such good progress is being made. I am delighted that the vaccination program in Norway continues at a good pace,” Health Minister, Bent Høie, told news agency NTB.

Number of gambling addicts seeking help during the pandemic rises sharply
The number of people who contacted Gambling Addiction Norway for the first time rose sharply in 2020.

792 people contacted Gambling Addiction Norway compared to 436 the year before, an increase of 82 percent.

Furthermore, the organisation says that numbers this year compare similarly with last year.

“We have never such high numbers before,” Lill-Tove Bergmo, leader of the organisation.

Current Coronavirus restrictions in Oslo extended until end of May
Oslo’s local Covid-19 restrictions will not be relaxed until May 27th t at the earliest.

Next week, the city council will decide whether the city will have more measures lifted at the end of May.

The city has adopted a phased approach to the second step of its five-step plan to reopen.

READ MORE: Oslo relaxes Covid restrictions with shops and malls to reopen 

The next set of measures that will be lifted will see bar’s and restaurants reopen and serve alcohol, along with gyms reopening.

“I understand that the hospitality industry and owners and users of gyms are getting impatient. The first part of step two of the reopening plan seems to have gone well, but we must still be careful. If infections stay low, then it should be possible to open restaurants, gyms, museums and more before may is over,” the city’s mayor, Raymond Johansen, said.

Decline in Norwegian economy in the first quarter
GDP for mainland Norway fell by one percent in the first quarter, according to seasonally adjusted figures.

There was an economic decline in each of the first three months of the year due to increased coronavirus infections and stricter infection control measures that sure retail and hospitality close in parts of the country.

READ MORE: Explained: What Norway’s revised budget means for you 

Total GDP, which accounts for offshore oil and gas extraction, and foreign shipping, fell by 0.6 percent.

Mainland Norway’s GDP was two percent lower in March 2021 compared to when the pandemic began.

473 new Covid-19 infections recorded
On Tuesday, 473 coronavirus infections were registered, a decrease of 36 on the seven-day average.

In Oslo, 86 cases were recorded on Tuesday, 23 less than the seven-day average.

The R-number or reproduction rate in Norway is currently 0.7. This means that the pandemic is receding in Norway as for every ten people that are infected, they will, on average, only infect another seven people.

Total number of Covid-19 cases. Source: NIPH
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