After some careful and restrained initial reaction, Norwegian Foreign Minister Børge Brende is now speaking out on what the election of Donald J Trump as US president may mean for trade and the Norwegian economy. Brende sees no reason to retract some critical comments he made about Trump back in August, and thinks the prospects for more free trade will be frozen while existing treaties may remain in force.
Brende told newspaper Dagens Næringsliv (DN) on Friday that his “nagging sense of unease” returned just before the US election on Tuesday. He’d been “uneasy” in August as well. After having to deal with other major setbacks this year, like Britain’s vote to leave the EU (Brexit) and Colombian voters’ defeat of a peace pact nurtured by his ministry, Brende had learned not to take anything for granted.
Never before, noted DN, has a US presidential election run more counter to Norwegian interests, or sparked more alarm among Norwegians and their political leaders. That prompted Brende to deviate from Norwegian government ministers’ prepared script during the past few days about how they’ll simply have to relate to the new US administration and, as Prime Minister Erna Solberg said Wednesday morning, strive for the best cooperation possible.
It won’t be easy. Norwegian officials are most worried about defense issues, but trade, relations with Russia, climate and Arctic matters are also areas of concern. Especially trade, since Norway’s relatively small economy depends on it. Norway needs to be able to freely sell its oil, gas, seafood, furniture and other products and natural resources abroad, notes Professor Gernot Doppelhofer of the Norwegian business school NHH in Bergen. “We don’t only import a large portion of the goods we consume,” Doppelhofer told newspaper Dagsavisen this week, “but several of our industries survive on exports.”
Jason Turflinger, director of the American Chamber of Commerce in Norway, said he and his organization’s members are deeply worried about the “anti-trade” policies of Trump and the government he’ll now lead. Analyst Knut Magnussen at DNB Markets also sees cause for concern. Statements made by Trump during the bitter election campaign “were so extreme that even a moderate version of them can have hugely negative consequences,” Magnussen wrote in his assessment of Trump’s victory.
While Norway’s Trade Minister Monica Mæland said on Wednesday that its was “much too early to speculate about whether Trump’s victory will have an effect on Norwegian trade with the US,” her government and Conservative Party colleague Brende is doing just that. Since Trump has opposed the US’ proposed free trade deal (TPP) with 11 countries in the Pacific, and is skeptical about another proposed trade pact between the US and the EU (TTIP), he thinks both of them may be put on ice.
“I was already uneasy in August about the signals coming out about changes and cancellations of trade deals,” Brende told DN. Now he says it can be “demanding” to get the TPP in place, and “more difficult” to come to terms on the TTIP, in which the Norwegian government is so interested that it commissioned a recent report on its consequences. The report concluded that nearly all industries and businesses could benefit, even if only marginally, from the TTIP except agriculture.
“I don’t think the TPP or the TTIP will be set aside forever,” Brende said, “but they will probably be put in the freezer for a while, and taken out again later.”
Brende is most anxious about what the new Trump Administration will do with the World Trade Organization (WTO), since Trump has even threatened to renegotiate existing trade agreements and pull the US out of the WTO. Brende hosted a gathering in Oslo just a few weeks ago of government ministers from all over the world, in advance of a major WTO ministerial meeting in Buenos Aires at the end of next year. Brende chose to be optimistic, telling DN that “it may happen that Trump will contribute to a positive round.”
Asked whether Brende and his fellow free-trade advocates have to rely on Trump not following through on his campaign promises, Brende noted that Trump himself claimed in his victory speech that he wants to bring Republicans and Democrats in the US together and seek some reconciliation. “In that lies a willingness to compromise and a willingness to soften or vary some of what was said during the campaign,” Brende said. “A new form of pragmatism. We must not forget that the majority of Republicans in the Congress are in favour of free trade.”
Brende said it was “too easy” to view Trump’s victory as one-dimensional opposition to free trade: “Some use it as a revolt against globalization, others to criticize inequality in society.” Still others have noted that many of Trump’s own voters in the US probably like being able to buy low-priced goods at large-volume retailing establishments like Walmart. If trade barriers go up, such goods can disappear.
Brende defended his criticism of Trump in August, when he said it was almost impossible “to believe what we’re hearing” from Trump. “If you look at what’s been said by (French President Francois) Hollande, (German Foreign Minister Frank-Walter) Steinmeier and others, my comments … were concrete and mild,” Brende told DN. He noted his comments were tied to Trump’s questioning of NATO’s solidarity and that he might cancel trade deals. “Now I’m hearing that I haven’t been critical enough about Trump, while others think I’ve been too clear,” he said.
Since Norway has become a major investor in the US economy through its huge sovereign wealth fund known as the Oil Fund, some have speculated that it can be used to wield some power over US policy. Brende told DN that he already has had “a string of conversations” with some of “Trump’s folks,” and none has brought up his comments in August. Like many others, Brende is hoping that a “President Trump” will be easier to deal with than a “Candidate Trump” and that Trump will not follow through on some of his brash campaign promises.
And then, as one ambassador in Oslo said during a gathering Thursday where Trump’s election was a major topic of conversation, Trump’s own supporters and voters will likely get angry if Trump fails to deliver, “and he’ll be gone in four years.”