Solberg wants to use 402.6 billion kroner from Norway’s Oil Fund this year

Erna SolbergPhoto: Vidar Ruud / NTB

In the revised national budget for 2021, the Norwegian government proposes to spend NOK 402.6 billion from the Oil Fund. That is NOK 90 billion more than in the state budget presented this autumn.

NOK 402.6 billion is estimated to make up 3.7% of the Oil Fund, the government writes.

In the revised national budget (RNB) for 2020, almost two months after the corona pandemic had begun, the government spent NOK 419.6 billion from the Oil Fund.

In total, however, the government also ended up withdrawing 3.7% of the Oil Fund in 2020.

Expecting growth over the summer and autumn

The reason behind Solberg’s decision not to spend even more oil money is that the government expects the Norwegian economy to start picking up again in the coming months as the population is vaccinated.

In the revised national budget for 2021, the gross national product (GDP) for mainland Norway is estimated to increase by 3.7% this year. In 2020, GDP fell by 2.5%.

The budget impulse – the growth contribution to the economy – for the current year is now estimated at 0.6%.

Unemployment is still relatively high by Norwegian standards, but it is falling. It is expected to end at 3.5% in 2021, compared with 5.0% at the end of 2020.

Weaker estimates than this autumn

Despite the fact that the outlook for the Norwegian economy is good, the outlook is somewhat worse than in the autumn estimates. 

In the national budget for 2021, which was presented at the same time as the state budget in October, the government estimated a GDP growth for mainland Norway of 4.4%.

The estimate for unemployment in 2021 is also somewhat higher now than it was in October. The national budget in October forecasted an unemployment rate of 3.1%.

However, the labor force survey from Statistics Norway shows an expected unemployment rate of 4.4% in the RNB, which is the same as the estimate in October.

Source: © NTB Scanpix / #Norway Today / #NorwayTodayNews

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