Norway

In-depth country-focused analysis on Norway's economic, political and operational risk environment, complemented by detailed sector insight

Norway

Norway attracts a number of our clients as Western Europe's largest oil producer, and the world's second-largest natural gas exporter. In terms of GDP per capita, Norway is one of the wealthiest countries in the world. The country has a long and solid tradition of democratic governance, with emphasis on consensus-forming and negotiated solutions to political differences.

We keep our clients informed of the latest market moves and political developments as part of our 'top-down' and 'bottom-up' perspective. Clients also benefit from in-depth analysis on eight of Norway’s most important industries. We provide interactive data and forecasting alongside detailed and risk-assessed analysis from our results-proven research teams. We aim to keep you ahead of the curve, so you can do business with ease in Norway.

Country Risk

Norway Country Risk

BMI View:

Core Views

  • A sharp slowdown in hydrocarbons sector investment amid a collapse in global oil prices will weigh on Norwegian GDP growth in 2015 and beyond.

  • However, the economic downturn should be limited. The decline in the Norwegian krone will help boost non-oil exports, and the government has the option of expanding fiscal policy by dipping into the country's USD860bn sovereign wealth fund.

  • The residential housing market has been a major contributor to overall real GDP growth for most of the past decade, but is set to cool over the next few years.

  • We envisage broad political continuity to the next election in 2017, with the Conservative-Progress minority coalition government achieving modest progress on its reform agenda.

Key Forecast Changes...

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Norway Industry Coverage (8)

Autos

Norway Autos

BMI View:

BMI maintains a modest view on the Norwegian autos market. Growth is expected to come from the dominant passenger car segment, with electric vehicle subsidies and strong private consumption growth buoying the market. However, the commercial vehicle segment is expected to register modest growth during 2015 due to low base effects, despite low government spending on infrastructure and the uncompetitive manufacturing sector.

BMI expects current electric vehicle (EV) subsidies in Norway to be revised in 2015; sooner than the government originally planned. The faster than expected uptake in EV sales created by the policy has called into question its sustainability and we believe we will see subsidies and incentives reduced in 2015.

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Food & Drink

Norway Food & Drink

BMI View:

BMI View: The Nordics consumer outlook remains gloomy, as the countries are expected to feel the negative effects of the slowdown in Russia and the eurozone. In 2015, real GDP growth in each country is not expected to exceed 2.4%. Heavy household debt loads will continue to curb private consumption in Denmark and Norway, while Sweden and Finland will suffer from relatively high and sticky unemployment levels.

Key Forecasts

Denmark

  • Food consumption (local currency) growth in 2015: +3.6%; compound annual growth rate (CAGR) 2014-2019: +4.5%

  • ...

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Infrastructure

Norway Infrastructure

BMI View:

BMI View: Our forecasts put Norway's construction sector value at growth of 4.9% in 2015, before the period 2016 to 2024 settles into a pattern of muted expansion of around 3.2% annually. Norway's 2013-2023 infrastructure development plan will provide the foundation for this steady investment story, with emphasis on transport and utilities infrastructure. A new low oil price environment and an overheating housing market provide considerable risk to private and government investment alike. By 2024, we expect Norway's construction sector value to reach NOK280.5bn (USD39.6bn), up from NOK175.1bn (USD24.9bn) in 2015.

Key Trends And Developments

  • Despite a slowdown in investment in the oil sector,...

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Medical Devices

Norway Medical Devices

Oil & Gas

Norway Oil & Gas

BMI View:

BMI View: Lower oil prices will impact investment in Norway, particularly in the Barents Sea and on IOR projects. In 2014, Norway registered its first increase in oil production since 2000, though we see declining production to 2020. The February submission of the FDP for Johan Sverdrup supports our forecast for oil production growth to return in 2020.

Headline Forecasts (Norway 2013-2019)
2013e 2014e 2015f 2016f...

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Pharmaceuticals & Healthcare

Norway Pharmaceuticals & Healthcare

BMI View:

BMI View: Norway's epidemiological profile will continue to be attractive to manufacturers of medicines for non-communicable diseases. Despite the relative rapid uptake of innovative pharmaceuticals, the burden of chronic conditions will only decrease slightly over the next 15 years. Like many other developed states, Norway is introducing cost-containment measures that will restrict the commercial opportunities presented to drugmakers.

Headline Expenditure Projections

Pharmaceuticals: NOK20.26bn (USD3.05bn) in 2013 to NOK20.71bn (USD2.68bn) in 2014; 2.23% in local currency terms and -12.1% in US dollar terms.

Healthcare: NOK282.26bn (USD42.50bn) in 2014 to DKK291.82bn (USD37.76bn) in 2014; +3.4% in local currency terms and -...

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Power

Norway Power

BMI View:

BMI View: Norway is a very mature market, and BMI therefore does not expect to see much growth in consumption, generation or new capacity over our forecast period to 2024. Hydropower and wind generation, especially offshore, are set to grow the most, as Norway replaces its aging hydropower capacity. A number of large-scale hydro and wind power projects are currently in development and the government recently increased equity in Norway's largest utility Statkraft, which will grow the company's borrowing power and investments into the power sector. Two new interconnectors coming online, which will nearly double Norway's export capacity, will enable local utilities to export excess capacity to higher price regions.

...

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Telecommunications

Norway Telecommunications

BMI View:

BMI View: A change in competitive dynamics is expected in Norway's electronic communications market in 2015. Firstly, Tele2 -backed Network Norway is to be sold to NetCom , accelerating the expansion of the latter's 4G and mobile broadband coverage; new entrant ICE will acquire Network Norway's customers, giving it a head start in developing its mobile business. Meanwhile, TDC Norway acquired Get , the country's largest alternative cable broadband operator and placing increased pressure on incumbent Telenor in the converged services arena. Finally, the national regulatory authority was restructured in January...

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