Prime Minster Erna Solberg held firm on Wednesday that Norway’s economy is still not in any crisis, despite this week’s market turbulence and the country’s reliance on oil as prices continue to sink. Both Solberg and Finance Minister Siv Jensen called for calm as they headed into a two-day conference to settle on a state budget for next year.
“We will take Norway safely through the (economic) transition we are now in the midst of,” Solberg claimed, once again using the Norwegian word omstilling to describe the transition or readjustment that Norway needs to make in order to diversify its economy and offset the effects of the oil industry slump.
“Norway is not in a crisis,” Solberg added, “but the challenges are bigger than they were earlier.”
With Jensen from the Progress Party standing by her side, Solberg of the Conservatives outlined the main priorities the government has in its next state budget for 2016, due to be presented in Parliament this fall.
“Our answer to the challenges is omstilling, to create more secure jobs and to combine economic growth with cuts in carbon emissions,” Solberg told reporters gathered outside their meeting place in Oslo. “We will carry out a green transition, and we will stress research, education and transportation.”
Solberg referred to “turbulent times internationally” and noted that “here at home, we’re affected by the fall in the oil price” (down to USD 43 this week after highs of more than three times that in recent year). Norwegian Broadcasting (NRK) reported Wednesday morning that no Norwegian oil fields are profitable at that level. “But we must not forget that there are bright spots in the Norwegian economy,” Solberg continued. “We don’t want to paint the situation black.”
The ministers within Norway’s minority coalition government will huddle both Wednesday and Thursday to argue, negotiate and ultimately come up with a budget that will also need backing from the coalition’s two so-called “support parties,” the Liberals and Christian Democrats. They’ve all been quarreling more than usual in recent weeks as the political campaign heats up in advance of municipal elections on September 14.
Solberg conceded the government also faced “uncertain times” and that “we have to take the challenges seriously, especially in regards to the oil industry.” She predicted the budget will contain more funding for entrepreneurs, start-up firms and more internships, “to get people into jobs.” A new survey this week indicated that Norwegians are more pessimistic about the economic outlook, but Solberg claimed she wouldn’t let pessimism set the parameters for the state budget. “We can’t turn the budget upside down because of what’s happening in the market,” she said.