Norway 2016 Country Review
2016 Country Review
Table of Contents
Chapter 1 1
Country Overview 1
Country Overview 2
Key Data 3
Norway 4
Europe 5
Chapter 2 7
Political Overview 7
History 8
Political Risk Index 21
Political Conditions 9
Political Stability 36
Freedom Rankings 51
Human Rights 63
Government Functions 65
Government Structure 67
Principal Government Officials 72
Leader Biography 73
Leader Biography 73
Foreign Relations 74
National Security 79
Defense Forces 80
Chapter 3 83
Economic Overview 83
Economic Overview 84
Nominal GDP and Components 90
Population and GDP Per Capita 92
Real GDP and Inflation 93
Government Spending and Taxation 94
Money Supply, Interest Rates and Unemployment 95
Foreign Trade and the Exchange Rate 96
Data in US Dollars 97
Energy Consumption and Production Standard Units 98 Energy Consumption and Production QUADS 100
World Energy Price Summary 101
CO2 Emissions 102
Agriculture Consumption and Production 103
World Agriculture Pricing Summary 106
Metals Consumption and Production 107
World Metals Pricing Summary 110
Economic Performance Index 111
Chapter 4 123
Investment Overview 123
Foreign Investment Climate 124
Foreign Investment Index 127
Corruption Perceptions Index 140
Competitiveness Ranking 151
Taxation 160
Stock Market 161
Partner Links 161
Chapter 5 163
Social Overview 163
People 164
Human Development Index 165
Life Satisfaction Index 169
Happy Planet Index 180
Status of Women 189
Global Gender Gap Index 192
Culture and Arts 201
Etiquette 202
Travel Information 204
Diseases/Health Data 213
Chapter 6 219
Environmental Overview 219
Environmental Issues 220
Environmental Policy 221
Greenhouse Gas Ranking 223
Global Environmental Snapshot 234
Global Environmental Concepts 246 International Environmental Agreements and Associations 260
Appendices 284
Bibliography 285 Norway
Chapter 1
Country Overview
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Norway
Country Overview
NORWAY
Norway is Europe's northern most country, bordering the North Sea and the North Atlantic Ocean, west of Sweden.
Between the 9th and 11th centuries, Viking ships from Norway raided coastal towns throughout
Western Europe and also colonized Greenland and Iceland. The Viking settlements were unified around 900, but the area was subsequently shaken by civil war and plague.
Norway was absorbed into a union with Denmark in 1380 that lasted more than four centuries.
Norway became part of Sweden in 1814, and it gained independence in 1905.
The country remained neutral in World War I, but it was occupied for five years (1940-1945) by
Nazi Germany during World War II. This led to Norway’s abandonment of neutrality; Norway was one of the signers of the NATO in 1949 and a founding member of the United Nations. But the Norwegians rejected membership of the then European Economic Community in 1972 and of the European Union in 1994.
Norway has an advanced, highly-developed economy, and is richly endowed with natural resources, including oil, gas, hydropower, fish, forestry, and minerals. Enjoying one of the highest standards of living in the world, the country has greatly benefited from the exploitation of its hydrocarbon wealth since its emergence as a major oil and gas producer in the mid-1970s.
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Norway
Key Data
Key Data
Region: Europe
Population: 4754045
Temperate along coast, modified by North Atlantic Current; colder interior; rainy year-round on west coast
Climate:
Norwegian (official) small Lapp and Finnish-speaking minorities
Languages:
Currency: 1 Norwegian krone (NOK$) = 100 oere
Holiday: Constitution Day, 17 May (1814)
Area Total: 342220
Area Land: 307860
Coast Line: 21925
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Norway
Country Map
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Norway
Europe
Regional Map
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Norway
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Chapter 2
Political Overview
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Norway
History
Early History
The earliest signs of human habitation in Norway date all the way back from the end of the last Ice
Age, at approximately 10,000 B.C.E. or before the common era.
The peak of the Viking period -- from the 9th century to the 11th century -- was one of national unification and expansion. Indeed, around the year 900, King Harald Fairhair united Norway into a single kingdom. Christianity then arrived in Norway during the next hundred years and was instituted as the official religion by King Olav II. It was this king who died as a martyr in 1030 and was canonised as Saint Olav, Norway's national saint. The Viking era ended in 1066 at the Battle of Stamford Bridge. There, King Harald Hardråde, who was also known as "the Hard
Ruler," was killed.
It is believed that an English ship introduced the "Black Death" of 1348. It is estimated that the "Black Death" wiped out up to two-thirds of Norway's entire population.
Scandinavian Connection
By the late 1300s, the Norwegian royal line had died out. Meanwhile, in 1380, the monarchies of Norway and Denmark were united, with Norway actually being ruled from the authoritarian center in Copenhagen. By the late 1500s, Norway was an entrenched part of the Danish kingdom. This union would last until 1814.
In 1814, as a result of the Napoleonic Wars, Norway was separated from Denmark and combined with Sweden. The union persisted until 1905, when Sweden recognized Norwegian independence.
Monarchy
The Norwegian government offered the throne of Norway to Danish Prince Carl in 1905. After a plebiscite approving the establishment of a monarchy, the parliament unanimously elected him
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Norway king. He took the name of Haakon VII, after the kings of independent Norway.
In 1957, after a reign of over half a century, King Haakon VII died. His son, Crown Prince Olav, then assumed the throne. Olav died in January 1991 and was succeeded by his only son, King
Harald V. Next in line for the throne is the Crown Prince, Prince Haakon, who was born in
July1973. He is followed by his daughter, Princess Ingrid Alexandra, who was born in January
2004.
Post-War Norway
Norway was nonbelligerent during World War I, but as a result of the German invasion and occupation during World War II, Norwegians generally became skeptical of the concept of neutrality and turned instead to collective security. Norway was one of the signers of the North
Atlantic Treaty in 1949 and was a founding member of the United Nations. The first United
Nations General Secretary, Trygve Lie, was a Norwegian.
Cultural Legacy
Culturally, one of the most significant legacies of Norwegian recent history is the Nobel Prize.
Under the terms of the will of Alfred Nobel, the Storting (Parliament) elects the five members of the Norwegian Nobel Committee who award the Nobel Peace Prize to champions of peace.
Note on History: In certain entries, open source content from the State Department Background
Notes and Country Guides have been used. A full listing of sources is available in the Bibliography.
Political Conditions
Except for three periods (1963, 1965-71 and 1972-73), from 1935 until 1981 Labor Party governments governed Norway. The Labor Party lost its majority in the "Storting" (parliament) in the 1981 elections. Since that time, minority and coalition governments have been the rule.
From 1981 to 1997, governments alternated between Labor minority governments and Conservative-led governments. Labor leader Gro Harlem Brundtland served as prime minister from November 1990 until October 1996 when she decided to leave Norwegian politics. Labor
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Norway
Party leader Thorbjørn Jagland formed a new Labor government that remained in office until
October 1997.
In the Sept. 16, 1997, parliamentary elections, the Norwegian Labor Party won 35 percent of the vote and 65 out of a total of 165 seats. The Progress Party followed with 15.3 percent and 25 seats. With 13.7 percent of the vote, the Christian People's Party also won 25 seats. The Conservative Party received 14.3 percent and 23 seats. The Center Party garnered 7.9 percent and 11 seats; the Socialist Left Party six percent and nine seats; and the Left Party 4.5 percent and six seats. The Coastal People's Party also won one seat.
Before the election, Prime Minister Jagland had declared that his government would step down if his Labor Party failed to win at least 36.9 percent of the national vote, the percentage Labor had won in the previous (1993) general election. Thus, despite Labor receiving the largest number of votes and seats, the Christian People's Party (25 seats) formed a minority coalition government with the Center Party (11 seats) and the Left Party (six seats), with Kjell Magne Bondevik (of the Christian People's Party) as prime minister.
Prime Minister Bondevik's minority coalition controlled only 42 seats in the 165-member
"Storting," (parliament). During the Bondevik government's tenure, the economy was the primary focus, especially privatization, welfare reform and regional trade.
Despite some successes on these fronts - and despite a strong performance from Norway's oil and natural gas sector - Prime Minister Bondevik's government fell in March 2000. Bondevik formally resigned on March 10, after losing a key vote in parliament on March 9. The minority government had been opposed to the construction of gas-burning power plants on the grounds that they would produce too much air pollution. The government had wanted to defer the construction of the power plants until technology to reduce carbon dioxide emissions became available. The opposition
- primarily the Labor and Conservative parties - had favored immediate construction of the plants and had pressed the vote. The opposition argued that constructing gas-burning power plants in
Norway was preferable to continuing to purchase electricity produced abroad by pollutionproducing, coal-burning plants - both in terms of meeting Norway's growing energy needs and on environmental grounds.
After Prime Minister Bondevik's resignation, King Harald V asked Jens Stoltenberg of the Norwegian Labor Party to form a government. Prime Minister Stoltenberg's minority Labor government formally took office on March 17, with 65 out of 165 seats in parliament.
Less than two months after taking office, the Labor government found itself facing Norway's largest labor dispute since the 1986 lockout of more than 100,000 workers. The largest private sector trade union, the Norwegian Confederation of Trade Unions (known by the abbreviation
LO), voted against a proposed employment agreement, and on May 3, nearly 86,000 workers
Norway Review 2016 Page 10 of 297 pages Norway commenced an "indefinite" strike. The strike affected the oil industry, newspapers, transportation
(especially trucking and domestic ferries), hotels and construction. The 64.3 percent of the LO's
300,000 members that voted against the proposal were said to be upset with what they view as a skewed pay scale favoring the upper echelons of management at the expense of the "average worker."
Six days later, on May 9, the strike was settled. In the face of threats to expand the strike to
102,000 workers, the employers' association, the Confederation of Norwegian Business and Industry (NHO), agreed to both a 4.6 percent wage increase (instead of the original offer of 3.5 to
4.0 percent) and the earlier implementation of a fifth week of vacation. The dispute seriously called into question the "solidarity pact" that has operated in Norway in the post-World War II era, namely the government-sponsored agreement between employers and workers to maintain full (or near full) employment in exchange for moderated wage demands that keep inflation in check.
In September 2000, Norway-along with much of the rest of Western Europe-experienced strikes by truck drivers outraged about high fuel prices. Unlike other European countries, however, the Norwegian strikes lasted only a day - with protestors calling off their blockades of 11 oil terminals after the state-owned oil company, Statoil, threatened legal action. In addition to concerns about strikes, Prime Minister Stoltenberg's government had to address Norway's financial restructuring.
Initially, this restructuring dealt primarily with the banking sector and the partial privatization of the state-owned telecommunications group, Telenor, and the state-owned oil company, Statoil. In
December 2000, Telenor was listed on the Norwegian bourse (stock exchange) and on the Nasdaq in the United States. Twenty-one percent of Telenor was sold in this partial privatization IPO
(initial public offering).
In March 2001, the "Storting" voted to allow a partial privatization (15 to 25 percent) of Statoil in
June 2001 on the Oslo and New York Stock Exchanges. Eventually, up to 33 percent may be sold, with the Norwegian government retaining a two-thirds stake. Twenty percent of Norway's stateowned oil and gas holding company will also be sold. While generating additional revenue for the state, the government hopes that these partial privatizations will also increase the efficiency of the energy sector. As one of the world's second largest exporters of oil, energy revenues allowed the Norwegians to enjoy one of the highest standards of living in the world, along with generous welfare state provisions. The national budget surplus is put in a petroleum-fund, in fear of inflation and to be used when the oil runs out. Despite Norway's enormous wealth, taxes are high and public sector services perceived -- by some some segments -- as unsatisfactory.
The election campaign leading up to the September 10 parliamentary elections focused on tax relieves and increased public spending. Despite Norway's wealth and high standard of living, the poor state of many public schools, hospitals, elderly people's homes, public transportation, as well as the high cost of living paved the ground for parties promising less taxes and improved public services. The election result was the worst in 80 years for the Labor party, which lost 10 percent
Norway Review 2016 Page 11 of 297 pages Norway of the votes compared to the 1997 election. The Conservative Party's message of lower taxes was well received by the electorate.
With the parliamentary support of the far-right Progress Party, a minority, center-right government alternative consisting of the Conservative, Christian-Democratic and Left Party emerged. After weeks of political struggle, a government consisting of 10 Conservative, seven Christian
Democratic and three Liberal Party ministers was agreed upon. The premiership was given to
Christian Democrat Kjell Magne Bondevik, who formed his second government on Oct. 19, 2001.
The largest party in the government, the Conservatives, won the foreign minister and the finance portfolios. The government controlled 62 out of 165 seats in parliament. The Progress Party, with its 26 seats, helped secure a majority for the center-right coalition, and said it supported the government because it promised to invest more in defense, open more private hospitals and more competition in the public sector.
The new government vowed to work to safeguard Norwegian economy, open up for increased privatization, maintain low unemployment rates, and focus on the welfare of children and young people. The speed of privatization was expected to accelerate, but rather slowly. Norwegian authorities and citizens are traditionally skeptical about foreign ownership. This, in addition to a meager base for private capital, hindered substantive business sell-offs and full-scale privatizations of state-owned and state-controlled companies.
The controversy of joining the European Union (EU) was not an issue in the election campaign, and was declared a "no go" topic for the current government. However in 2002, polls indicated that the public was gradually warming to the possibility of EU membership.
As a consequence of the international economic slowdown following the September 11 attacks, the price of oil dropped. On December 17, Norway agreed to reduce its crude oil production by
150,000 barrels per day from Jan.1 to June 30, 2002. Although Norway has no formalized agreement with the Organization of Oil Producing Countries (OPEC), Norway joined OPEC countries in cutting production to stabilize the oil market and prevent oil prices from dropping significantly.
Norwegian politics would continue to be marked by large degree of consensus. With some success in reforms and tax cuts, the minority coalition government was likely to stay in power.
Nevertheless, an indicator of the parliamentary divisions and the lack of a strong government was obvious in the process leading up to the approval of the budget. After weeks of negotiations with the Progress Party, Prime Minster Bondevik had to demand a vote of confidence in order to have the government's budget approved. This rocky start did not bode well for the government's future stability. Also, Prime Minster Bondevik received criticism from his own party members for having made many compromises, leaving a "too conservative" mark on the government's budget and policies.
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Polls indicated that those voters who may have -- in the past -- supported the Labor Party switched allegiances to the Socialist Party in recent times, as they believe the Socialist party is a more effective people's party. In order to breath new life into the diminishing Labor Party, in April
2002, Jens Stoltenberg was appointed the Party's new chairman. Following his appointment, polls showed that the Labor Party recovered some of the support it had lost in previous months.
In 2002, immigration and asylum policies were hot topics in Norwegian politics. While once considered a liberal and open host country for asylum seekers, with the emergence of the conservative parties, particularly the now popular Progress Party, the government was preparing to tighten the process to grant those seeking asylum in Norway. It had been proposed that those who applied for asylum without proper documentation would be jailed; it was a move supported by right and left wing parties.
In April 2002, days before the immigration policy was to be debated in the "Storting," Arne Huuse, the head of the National Bureau of Crime Investigation, criticized the policy following a double murder allegedly carried out by immigrants. Huuse noted that the cost of integrating immigrants into Norwegian society might well be too high, and he insinuated that immigrants posed a violent threat to Norwegian society. Defenders of the immigration policy claimed that violence was a result of immigrants being marginalized in Norwegian society; they believed that society owed immigrants assistance in cultural and societal integration. Others still argued that Norway was facing a labor shortage and the problem could only be filled with immigrant labor.
The Norwegian government also worked on defense reform and proposed an increase in the defense budget by NOK1 billion in 2002. Norway has been in the procoss of gradually transitioning its defense emphasis from a Cold War-style domestic defense structure to more internationalized force, which contribute to coalition operations and peacekeeping efforts abroad.
In 2003, security concerns and foreign relations came to the forefront of the national agenda following the inclusion of Norwegian embassies and interests in terrorist threats emanating from the al-Qaeda network. Norway has typically been considered to be a country with a strong pacifist tradition, and it has been a key player and mediator in the Middle East process. Norway has been vocal in its criticism of United States' foreign policy and its "war on terrorism." As such,
Norwegian leaders in Oslo were bewildered about why they would be targeted by Muslim fundamentalist groups.
Some diplomats said that it was possible that al-Qaida operatives simply got the geopolitics wrong and incorrectly targetted Norway. Because Denmark sent forces to fight in Iraq, they wondered if the al-Qaida operative confused the two Scandinavian countries. Meanwhile, media outlets in
Norway, including the daily, Dagsavisen, speculated whether or not Norway's role and military engagement in the war in Afghanistan following the Sept. 11, 2001, terrorist attacks in the United
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States might have fueled radical Muslim resentment.
Still others expressed the belief that it may have been Norway's role as a mediator in the Middle
East peace process that lay at the root of the matter. For the most radical Muslim groups, it might appear as if Norway is simply functioning as another Western proxy for the United States' support for Israel, despite Norway's active involvement in mediating the Middle East. The mere existence of the Oslo Accords as key elements of the peace process symbolically positions Norway in the center of the Middle Eastern imbroglio.