A new economic outlook report from the Organisation for Economic Co-operation and Development (OECD) suggests that Norway will be the first country in the world to fully emerge from the global finance crisis. The OECD also thinks Norway’s economic development will remain ahead of the pack.
“Economic recovery has already started in Norway, with the large fiscal and monetary stimulus (from the government) boosting consumption and sustaining employment,” writes the OECD in its latest Economic Outlook.
OECD researchers also noted that a “rebound” in housing prices “is a sign that this stimulus is encouraging households to spend rather than to consolidate their balance sheets.”
The OECD also expects that growth in private investment will resume next year, but cautions that the government now must exercise “sizeable subsequent tightening” of its “fiscal stance.” It noted that monetary policy tightening already has started, with the central bank raising interest rates, “and should continue for some time, as the economy recovers, the labour market tightens and inflation expectations edge up.”
Newspaper Aftenposten reported Friday that Norway has the lowest unemployment rate of all the OECD countries in 2009. By 2017 only a reinvigorated Iceland is expected to have lower unemployment than Norway.
No other country is expected to have such strong growth in private consumption as Norway next year and in 2011 and only some eastern European countries will have stronger growth overall than Norway by 2017.
“We have used the hard times to better prepare for the years ahead,” Bente Svensson of consulting firm Accenture Norge told Aftenposten . She said that Accenture itself is educating its employees, hiring new and acquiring small firms with special expertise. The Norwegian economy should provide a good base for firms like Accenture, although concerns have been raised over empty orderbooks in the offshore sector from 2011.
Norway has weathered the global finance storm better than most countries because of still-high oil prices, minimal losses in the banking sector and the launch of what the OECD called “tremendous” government stimulus programs to keep money flowing through the system. The programs involved using a much higher level of oil revenues, which exceeded limits normally in place.