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Economic Outlook in the Nordic Countries 2014

The Nordic Working Group of Economic Trends Review, autumn 2013

image of Economic Outlook in the Nordic Countries 2014

The Economic Outlook in the Nordic countries 2014 is the review from the Nordic Working Group of Economic Trends for the economic situation in the Nordic countries autumn 2013. The review contents as previous years, a special chapter with a short outline of the economic situation in the Nordic countries as whole, and a chapter of the situation in every single country.

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Norway

Norway’s petroleum industry gives large revenues to the Norwegian Government. At the same time it presents particular challenges for fiscal policy in ensuring a stable economic development. The Government Pension Fund Global and the fiscal policy rule together constitute Norway’s fiscal framework. The state’s current net cash flow from petroleum activities is saved in the Fund, while concurrent spending over the fiscal budget follows the expected real return of the wealth already accrued in the Fund. Expected real return is estimated at 4 per cent. Through the Fund, a large proportion of the State’s oil and gas income is invested in other countries. Investing foreign exchange earnings abroad protects the krone against the large, varying foreign exchange earnings generated by the petroleum industry. The framework is designed to promote a stable development of the Norwegian economy. It gives room for a gradual increase in the spending of petroleum revenues, yet also cushions exposed industries from rapid downscaling and ensures that resource wealth will benefit future generations.

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