Norwegian economy will probably improve next year. Would that prove more beneficial to opposition leader Jonas Gahr Støre or to Prime Minister Erna Solber?
The two-year downturn in Norway has, according to SSB swept away 50,000 oil-related jobs and lead to an increase in unemployment from 3.3 percent two years ago to 4.7 percent today.
It’s good news for the Norway if things change for the better in the election year 2017. But for politicians in crisis mode, this is a new situation:
For Støre and the Labour Party an economic upturn that leads to fewer people being out ot work, weaken important political points of attack against the government – that the blueblue have failed in their fight against unemployment.
For Solberg an economic recovery will make it harder to argue for pouring more and more of the Norwegian oil wealth into the state budget.
That the oil prices has risen from 27 to 50 dollars a barrel since January , is one of the reasons why the economic downturn in Norway is about to end. At the same time, record low interest rates have meant a far weaker krone and the economy being strongly stimulated by oil money.
Forecasts from the Ministry of Finance, Norges Bank and Statistics Norway show significantly higher growth in the mainland economy next year.The level of unemployment will peak this year and will start to go down in 2017, they estimate.
Also Nordea Markets and DNB Markets also believe the growth will pick up next year, but that unemployment still will continue to increase.
However, if oil prices once more should fall, this may put the likely economic upturn in jeopardy. Other risk factors are international financial unrest if Britain leaves the European Union, or Greece being forced out of the eurozone. Nationally, a sudden fall in house prices or a powerful new asylum influx could also rattle the economy.
Source: NTB scanpix / Norway Today