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

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

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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

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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 remain in negative growth during 2014, due to low government spending on infrastructure and the uncompetitive manufacturing sector.

Current electric vehicle (EV) subsidies in Norway will 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

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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

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BMI View: The construction sector in Norway reported stronger-than-expected growth in 2014, expanding by a healthy 5.5% to reach NOK171.6bn (USD25.6bn). Moving forward, the decline in global oil prices is likely to impact fixed investment in the oil and gas sector, leading to more subdued overall growth forecasts of 3.7% in 2015 and around 3.3% per year throughout the remainder of the forecast period to 2024. This growth will be driven primarily by an extensive government investment programme in transport infrastructure, as well as more limited growth in the residential construction market.

Key Trends And Developments

  • Despite a slowdown in investment in the oil sector, opportunities remain in utilities, particularly the renewables market....

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Medical Devices

Norway Medical Devices

BMI View:

BMI Industry View : The Norwegian medical device market is limited by the size of the population, but enjoys above average per capita spending of US$294. The market is projected to grow at a US dollar CAGR of 3.1% to 2018 with the ageing population the main growth driver. The market will continue to be import-led with much of domestic production geared to the export market.

Headline Industry Forecasts

  • In 2013, the medical device market...

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Oil & Gas

Norway Oil & Gas

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BMI View: Norwegian oil is on track to return to growth in 2014 after 12 consecutive years of decline. Both oil and gas production will remain steady in 2015 despite lower oil prices, though investment in Norway's upstream will fall. This is expected to impact longer-term oil production with less investment in IOR projects and frontier development.

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Headline Forecasts (Norway 2012-2018)
2012 2013 2014f 2015f

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Pharmaceuticals & Healthcare

Norway Pharmaceuticals & Healthcare

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BMI View: Despite the forecasted decline in the burden of disease in Norway over the next two decades, the anticipated growth of Norway's ageing population is to have an unprecedented impact on the demand for healthcare. The elderly require more medical check-ups and care than young people as a result of the increased prevalence of chronic disease with age. They therefore consume a disproportionately large share of healthcare services. Such robust demand for services over the coming years means that the government will need to adapt strategies and cost efficiency to deal with increasing healthcare costs.

Headline Expenditure Projections

Pharmaceuticals: NOK19.90bn (USD3.36bn) in 2013 to NOK20.26bn in 2014; 1.82% in local currency terms.

Healthcare: NOK273.15bn (USD46.17bn) in...

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Power

Norway Power

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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

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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...

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