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Norway’s ‘war profits’ now aimed at boosting Ukraine’s defense

The Norwegian Parliament looks likely to support or even expand a huge new aid package for Ukraine. Norway will tap into its extraordinary oil and gas profits from the war to fund more weapons for Ukraine’s defense against Russia, and more support for its civilian population.

Norway has already sent weapons and other aid to Ukraine. Now it will be sending a lot more. PHOTO: Forsvaret

The Norwegian government proposes funding the aid package with NOK 75 billion (USD 7.28 billion) over the next five years. Prime Minister Jonas Gahr Støre of the Labour Party specified that half the money (NOK 15 billion a year) would fund more weapons and training for the Ukrainian military and half would fund “civilian support.”

The money will come from Norway’s huge sovereign wealth fund that’s been fueled by oil and gas revenues over the past few decades. Known as the Oil Fund, it didn’t post positive returns on its investments last year because of how Russia’s war on Ukraine has battered stock markets. It has nonetheless swelled because of how Russia’s invasion of Urkaine nearly a year ago immediately boosted the price of oil and gas and left Norway facing a moral dilemma.

The huge earnings on oil and gas amounted to war profits that haven’t gone unnoticed either within or outside the country. Norway has been under pressure to put its windfall petro profits to good use, and has at times ranked as among the largest supporters of Ukraine by a variety of measures. Calls have gone out from both the minority Labour-Center government’s partner, the Socialist Left (SV) Party and others including the Liberals to do even more.

Now Støre and his embattled finance minister, Trygve Slagsvold Vedum of the Center Party, have responded with what they’re calling the “Nansen Program for Ukraine,” in the spirit of the late Norwegian Peace Prize winner, polar hero and humanitarian leader Fridtjof Nansen. Newspaper Dagens Næringsliv (DN) reported late last week how Nansen also played a major role in helping Ukraine in the early 1920s, when it was threatened by famine. Now Ukraine needs humanitarian and miiitary help again.

Many other countries around the world do, too, especially after Russia’s invasion of Ukraine sent food prices skyrocketing in addition to fuel and other energy. Støre’s government is thus also proposing an increase of another NOK 5 billion in Norway’s foreign aid budget: NOK 2.5 billion for food aid and NOK 2.5 billion for humanitarian aid aimed especially at countries in Africa that are suffering from inflation, drought and armed conflicts.

Prime Minister Jonas Gahr Støre, second from left, met with leaders of all the Parliamentary delegations on Monday to introduce his government’s new aid plan for Ukraine. At far right: Bjørnar Moxnes, leader of the Reds Party, the only one in Parliament that doesn’t support weapons shipments to Ukraine. PHOTO: Stortinget/Peter Mydske

On Monday, Støre and Vedum met with the leaders of the delegations for the other seven parties in Parliament, and their proposed package seemed well-received. Only the far-left Reds Party opposes sending military aid and weapons to Ukraine and all parties support financial aid to help civilians, repair war damage and rebuild.

“This is in line with what we’ve been discussing, and it’s good to hear what the government is thinking,” Erna Solberg, the former prime minister who leads the Conservative Party, told state broadcaster NRK. She’s in favour of using more money from the Oil Fund to help Ukraine, as is her former government partner, Guri Melby of the Liberals. Melby thinks the proposed amount of NOK 75 billion, should be “the floor, not the ceiling … especially in light of the extraordinary income Norway has received as a consequence of the war.”

The government’s new aid package for Ukraine seemed well-received by the leaders of Parliamentary delegations. From right: Lan Marie Berg of the Greens Party, Audun Lysbakken of SV and Erna Solberg of the Conservatives. PHOTO: Stortinget/Peter Mydske

The Socialist Left Party (SV) wants to bring foreign aid back up to at least 1 percent of gross national income if not gross national product, and the Christian Democrats’ leader Olaug Bollestad said she’s glad the government has “reached its moment of truth.” She’s been a big backer of much more aid to Ukraine (around NOK 15 billion so far) and more other foreign aid, as has Lan Marie Berg of the Greens Party. “It’s interesting that Støre now seems to agree with us, also that sending more foreign aid abroad won’t lead to more inflation at home,” Berg told newspaper Dagsavisen.

Støre and Vedum were criticized last fall when their first and tight state budget didn’t meet the “foreign aid percentage” for the first time in 50 years. Even though the amount of money allocated increased, it only amounted to 0.75 percent of GNP. Støre has claimed he supports the 1 percent goal, but notes how GNP itself has been swinging.

The goal is to get the new aid package to Ukraine in place by February 24, the date Russia invaded Ukraine last year. Norway has already donated weapons, its advanced surface to air missile systems (NASAMS) developed by Kongsberg Gruppen in Kongsberg and, most recently, tanks and training of Ukrainian soldiers. Ukraine has expressed gratitude but was disappointed that Norway won’t remove tariffs on agricultural imports from Ukraine.

Many also hope the new aid package, meanwhile, will also boost Norway’s position on the list of donors to Ukraine, after it fell to 14th place in mid-January as a percentage of GNP. The US has topped lists in terms of actual amounts while Estonia has donated the most as a percentage of GNP.

The most important goal, though, is that Ukraine prevails in its defense of its democracy and territorial sovereignty under attack from Russia. Norway, its allies in NATO and all members of the EU have stressed that Ukraine isn’t just fighting for its own democracy but for that of every democracy in Europe in the face of Russian aggression. Berglund



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