The figure represents the first time since 1994 that the Norwegian state has been in the red in its quarterly accounts, according to Statistics Norway (SSB).
“The numbers are uncertain and may be revised. But as things stand now, we are probably looking at a quarter with a loss in public administration,” SSB section director Pål Sletten said in a statement.
“In such case, this would be the first time (a quarterly deficit has occurred) since 1994,” Sletten said.
A deficit in Norway’s public finances is measured by net investments using state funds. The first quarter of 2020 saw a surplus of 22 billion kroner.
Reasons for the drastic downturn include a drop in oil and tax revenues and increased spending in response to the coronavirus crisis.
“State revenues have fallen and expenses have increased. The public sector has thereby protected the private sector from most of the decline in national income,” Sletten said.
“The counterweight to that is that the state has gone from saving to deficit for the first time in very a long time,” he added.
Norway averaged a surplus of 10.7 percent of GDP in its public finances from 2002 to 2019.