Norway

 

 

 

Noah Fleck and Kate Kapas

   

Guiding Question:

 

How does the information in the categories relate to economic growth and the standard of living in that country?

•  How does your country compare to the US? You need to address this question under each topic that allows for an answer.

Kingdom of Norway

Kongeriket Norge (Norwegian)

 

 

 

Capital

Oslo

 

Official Government Website

The Website of Norway from Norway- Please select America.

 

 

Monetary Unit:

The Krone of Ã¸re is the national currency of Norway.  

 

 

Chief Exports:

 

• Petroleum and Natural Gas
• Most Nonferrous Metals
• Chemicals
• Paper
• Iron
• Steel
• Food/Food Products

 

Chief Imports:

 

• Machinery
• Equipment of Transportation
• Chemical Products
• Clothing
• Accessories
• Iron
• Steel
• Metal Ores

 

Gross Domestic Product:

The GDP per capita was $42,300 as of 2005. While the GDP- purchasing power parity was at about $194.1 Billion (also as of 2005). As of 2005, the GDP was growing at approx. 3.9%. (Norstebo 270)

 

Balance of Trade:

 

 

This graph shows that while Norway exports much of their goods to places like the United Kingdom and Germany, the do not import as much as other countries do. Most of their goods therefore are domestic. You can also notice that the United States is not one of their top trading partners, but the United Kingdom is. It is clear that Norway is not one of our top trading partners.

 

 

Exports and Imports as of 2005:

Exports: $111.2 Billion f.o.b.

Imports: $58.12 Billion f.o.b

As this data and the graph both state, the imports of Norway are vastly lower than that of the amount of money that they, Norway that is, receive from their exports.

 

My Country Overview (Location and Size, Population):

 

  

 

 

 

I am a country that is on the Norwegian Sea and share my eastern border with Sweden and my northeastern border with Finland. My southern border is on the North Sea and is relatively close to the country of Denmark. My western border is along the Arctic Ocean and Norwegian Sea.

 

The population of Norway was estimated at 4,660,539 (July 2009 est.) with an estimated growth of 0.341% (CIA). The population has 94.4% Norwegian which includes Sami, 3.6% other Europeans, and 2% other at a 2007 estimate (CIA).

 

Constitutional Monarchy of Norway:

 

 

Norway has a constitutional monarchy, a constitutional monarchy is a system of government in which a monarch, king or queen, is guided by a constitution whereby his or her rights, duties, and responsibilities are spelled out in written law or custom. Norway's king right now is Harald V, Norway also has a parliamentary system of government. Meaning that it separates its executive and legislative branch. This separation of power prevents one person from gaining too much economical power, also called "checks and balances". Having a Constitutional Monarchy affects the economic growth and living standard of a contry, because even though the country has one central power its economic growth isn't artificially changed, this is because that one central power has to follow by a constitution. This ends up affecting the living standard of a country because now the living standard isn't artificially changed also, meaning that there is a wide variety of high class, middle class, and low class. This is unlike monarchy which everything is controlled, usually ending up in a majority of lower class.   

 

Detailed Overview of the Economy:

 

Now the Norwegian economy is prosperous with welfare capitalism, which has a mix of government intervention and free market. The government controls areas, such as petroleum sectors. The country has multiple natural resources such as petroleum, water (used for hydro power), lumber, fish, and minerals. The economy highly depends on the petroleum sector, which in total accounts for nearly half the exports and 30% of revenue. Norway is also the world’s 3^rd largest gas exporter. Norway now saves almost all state revenue from the petroleum sector in sovereign wealth fund.

 

 

 

Unemployment Rate of Norway:

The unemployment rate of Norway is 2.6%

 

Percentage of Population under poverty line:

There is about a percentage of around 35% under the poverty line due to a gap between the rich and poor.

 

 

Foreign Aid/Grant:

Norway recieves Foreign aid from mostly collective investors worldwide who invest more and more money into Norwegian oil industry everyday. The investment in oil creates a greater part of the FDI, or money that comes into Norway. These investments is one key factor that keep Norway running. Norway also provides more foreign aid to developing countries as a percentage of its GDP than any other Western industrialized nation, said a Foreign Aid Ministry. He added that Norway gave close to 6 billion crown, or 1.16 percent of its total G/S, in aid last year to United Nations bodies, the World Bank and other Organizations.

 

Taxation Policy:

Both the Municipal and National governments of Norway imply special taxations on population. They also enforce the "earn-as-you-pay" taxation system in many government taxes. Oil companies of Norway now have to pay 50% of their total income to the government, corperations have to also pay 28% of their total income. This then lowers GDP becuase buisnesses have less money to spend on resourses to make the goods or less money to spend on people to hire. Thus by this the GDP is then lowered. When the GDP is lowered we can then infer that the quality of life is lowered. Personal income tax of 50% of the total income is also enforced, this is caused by a 28% reduction of municipal and national taxes.

 

 Economic Sectors:

While once leading sctors of agriculture, forestry, fishing, and manufacturing, these have gradually declined in terms of contribution to GDP.  it has now become increasingly services oriented. In 1999, agriculture, forestry and fishing- although still employing 4 percent of the labor force- accounted for 2.2 percent of GDP in 1998. Industry as a whole accounted for 26.3 percent of GDP while services, including those provided by the government, accounted for 71.5 percent of GDP.

 

International Trade:

Norway is the world's third largest oil provider, behind Russia and Saudi Arabia. They import many cars and raw materials to make things in the country. 78.2% of Norway's exports were through the European Union and 70.8% of the imports were through the European Union. (ed. Gall)

 

 

Name of Stock Exchange:

The Oslo Stock Exchange is small if you look at it against other countries because it only has 215  business that are listed. The stock exchange has less businesses than our own in the United States. 

 

Natural Resources:

• copper
• petroleum
• natural gas
• zinc
• timber
• lead
• titanium
• fish

 

 

Environmental Issues:

Norway has problems with their rivers being poluted and making it so they lose one of their natural resources, fish. This provids the issues with income because if they do not have money comming in from that industry, the industry and later the country's economy will suffer. They will have a lower GDP and this will make their standard of living much smaller.

 

 

 

Net Migration Rate/Migration Section:

According to the CIA World Factbook, Norway has a  net migration rate of 1.71 migrant(s)/1,000 population (2009 est.). This is either good or bad depending on how you look at it. It could be bad because the shortage of workers will make a surplus of jobs which hurts the economy. It could be good, because the people have options in the work world.

 

Banking and Securities:

The Bank of Norway prints all of Norway's currencies because they are the national bank. The number of banks has decreased with the economy and has gotten smaller through time. Many of the banks in the late 1990s had a hard time because the bank system was failing, these banks tried to merge, but it was unsuccessful.

 

Literacy Rate and Education Expenditures:

100% of citizens older than the age of 15 can read and write for both male and female.

 

Consumption Section:

• Electricity consumption 128.8 billion kWh
•  Oil consumption 224,500 bbl/day
• Exports and imports $117.6 billion f.o.b. / $93.21 billion f.o.b.
• Internet users 3.8 million

 

The gas prices in Norway are outrageous. 

Oil-Rich Norwegians Take World's Highest Gasoline Prices in Stride.

 

Noah:

This affects my life because the price of oil here also depends on the price of oil there. One of their main exports is oil. It is said that they are the third largest oil exporter. This then lowers the price oil for me because there is a bigger supplies which than lowers the price, thus in effect increases the demand. This helps out Norway’s GDP, but in turn it slowly lowers our GDP because we will start buying more imports than we will be selling exports, this will put us in debt. How Norway exports so much oil though is their own citizens have to give oil up. When our cost of oil was $2.25 there price was around $7. This will also overtime motivate them to enhance alternative energy. Once this break through happens then car companies will be motivated to start making eco-friendly cars. Hopefully by this time America is still selling cars. This will increase our exports by the amount of eco-friendly cars being sold, thus increasing GDP. Once the GDP is increased the standard of living in America will hopefully. These changes may start bad with Americas GDP decreasing, but in the end it will be a good turn for America. This though is one of many outcomes that can happen though; it all depends on the attitude of oil. Either way though my life will be affected by the oil of Norway.

 

 

Kate: The article relates to us in the fact that Americans were complaining about the fact that gas was at $3. The people of Norway have had gas of at least $6.66 since we had it at $2.25.They have  taxes on just about everything and we do not, however, they just brush it off as it being the same stuff that they have always had to deal with. Norway has also put laws into effect that make it so that the people are more fuel efficient. There are not as many big SUVs in Norway that there are here. This is because they have made it so that SUVs that would cost less than $70,000 in the U.S.  cost around $100,000 in Norway. If our government took some of the same measures that Norway has, it would force the Big Three to invest in less sizably SUVs and into more small and fuel efficient cars.

 

Future Trends: 

The banking sector of Norway is recovering, and therefore, the whole nation is undegoing economic boom. Thus raising the GDP becuase businesses can spend more money on raising the amount of products they can produce, and in all raise the standard of living.