On September 22 NACC members had the opportunity to listen to Chief Economist of Handelsbanken, Norway, Kari Due-Andresen’s excellent presentation about the economic challenges facing Norway. She touched upon the world economy, especially the uncertainties in Europe, Brexit, China’s weakening, the outcome of the U.S. election and how Norway is affected.
She explained that after some tough years for the Norwegian economy, there is a belief in Norway that oil prices will not fall further, and this is creating a certain optimism, especially in oil related industries. The lower krone exchange rate has helped the traditional export industries but, unfortunately, not enough to offset the downturn in oil as Norwegian export products are less competitive due to high manufacturing costs. This is one of the main reasons why it will take time to rebalance the Norwegian economy.
In spite of this there is a certain optimism among Norwegian consumers, people are spending more, mainly on necessities and housing and less on luxury items. Ms. Due-Andresen concluded that the contractions in the oil related industries in Norway should be over and that there are some improvements in other sectors, but that the economic growth rate will be rather flat for some years to come.