The northern country of Norway is known for its high standard of living. The country is relatively easy going through the global financial crisis, and the economy shows stability and positive dynamics. How is the Norwegian economy different from other European countries? Let's talk about the features of the Norwegian economy, its structure, prospects.
Geography of Norway
Norwegian economy is in some sense determined by the geographical position of the country. The state is located in the western part of the Scandinavian Peninsula, in Northern Europe. It strongly depends on the seas by which it is washed. The coastline of the country is 25 thousand kilometers. Norway has access to three seas: the Barents, Norwegian and North. The country borders on Sweden, Russia and Finland. The main part is located on the mainland, but its territory also includes a huge (50 thousand) island network, some of them are uninhabited. The coastline of Norway is indented by picturesque fjords. The relief of the main part of the country is mostly mountainous. From north tosouth stretched mountain range, which in places alternates with elevated plateaus and deep valleys covered with dense forests. The north of the country is occupied by the Arctic tundra. In the south and in the center there is a plateau favorable for agriculture. The country is very rich in fresh waters, there are about 150 thousand lakes and many rivers, the largest of them is Glomma. Norway is not very rich in various minerals, but it has significant reserves of gas, oil, several ores, copper, lead.
Climate and ecology
Norway is located in the zone of influence of the warm current of the Gulf Stream and this makes the local climate milder than that of Alaska and Far Siberia located at the same latitude. But still the climate of the country is not particularly comfortable for life. The western part of the country is dominated by warm currents and has a temperate maritime climate with mild winters and short warm summers. There is a large amount of rainfall here every year. In July-August, the air here warms up to 18 degrees of heat, and in winter it does not fall below two degrees of frost. The central part belongs to the temperate continental climate zone with cold winters and short warm but not hot summers. In winter, the average temperature here is 10 degrees below zero, and in summer the air warms up to 15 degrees Celsius. The far north of the country is characterized by a subarctic climate, with long, harsh winters and short, cold summers. In winter, on average, the thermometer shows minus 20 degrees, and in summer the thermometer rises to 10 degrees Celsius. In the norththere is an atmospheric phenomenon - the northern lights.
In general, Norway's economy can be briefly described as green. Here, great attention is paid to the preservation of the primordial nature. Although fishing and oil production cause some harm to nature, Norway still cannot cope with this. Nevertheless, the air and water are very clean here, industrial enterprises operate according to high safety standards, which are considered among the highest in the world. The growth of the tourist flow also poses a certain threat to the country's ecology, and this problem has not yet been resolved either.
History of economic development
Until the 9th century, Norway was a country of conquerors. The Vikings terrified the whole of Europe, reaching all the way to the shores of Turkey. The main income of the inhabitants of the country was the collection of tribute from the conquered lands. In the 9th-11th centuries, the vast lands belonging to the Norwegian king went through the path of reform, Christianity tried to penetrate the region several times, there was a struggle between separate regions, and people were unrest. The economy is undergoing major changes. The territories subject to taxes are gradually shrinking, new forms of management were needed. In 1184, the former priest Sverrir comes to power, he delivers a powerful blow to the clergy and aristocracy and introduces new principles for the existence of the state - democratic. The next few generations of monarchs were engaged in the centralization of the country and the settlement of political strife. At the end of the 13th century, Norway is experiencinga significant crisis in agriculture, which is associated with the plague epidemic. This leads to a strong weakening of the state. Since the 14th century, Norway has experienced a long period of dependence on the Scandinavian states. This could not have a positive effect on the development of the economy. The country is increasingly turning into a peripheral state with a weak economy. In the middle of the 17th century, the country experienced a serious economic take-off due to the collapse of the Hanseatic League. Europe begins to actively consume Norwegian raw materials: timber, ore, ships. Industry is booming. But the country remained part of Sweden. At the beginning of the 19th century, Norway, under the leadership of Christian Friedrich, was able to defend their rights to independence. But not for long. Sweden did not want to part with these territories. And throughout the 19th century there was a struggle to uphold the rights of the Norwegian people to their own government and legislation. In parallel, there is an increase in industrial production, which becomes a platform for the emergence of a we althy class that did not want to remain under Swedish rule. In 1905, the country managed to get rid of the influence of Sweden, a Danish prince came to power. During the First World War, the state adheres to neutrality, this allows Norway to significantly improve the performance of its economy. But the global economic crisis of the late 1920s and early 1930s did not bypass the country. At the beginning of World War II, Norway again decided to remain neutral, but Germany did not pay attention to this and took over the country. The post-war years became the formation of a state with a new economy. Here, more than inother European states, methods of fair distribution of income are applied. At this time, the general characteristics of the Norwegian economy can be described in two words: justice and democracy. The country twice refused to join the European Union, although it supports the integration processes and the Schengen Agreement.
Population of Norway
The country's population is slightly over 5 million. The population density is only 16 people per sq. km. The main population is concentrated in the east of the country, the coastal zone around Oslo is densely populated, as well as in the south and west of the country. The northern and central parts are almost empty, and some of the islands are completely uninhabited. The Norwegian economy today provides high employment. About 75% of the population are employed. 88% of the country's residents with higher education have no difficulty in finding employment, this is the best indicator in Europe. This indicates that the country's economy is developed at a very high level. The growing life expectancy of Norwegians also speaks of the high quality of life, it averages 82 years.
Political structure
Norway in its political system is a constitutional monarchy. The head of the executive branch of government and the official head of state is the king. Legislative power is in charge of the unicameral parliament. The king formally has a fairly large list of duties and rights. He appoints and dismisses the prime minister, approves laws, is in charge of war and peace, and heads the supreme court. Butpractically all the main issues of governing the country are handled by the government headed by the prime minister. The executive power has the right to carry out state regulation of the Norwegian economy, it controls the work of the public sector of the economy, which is a highly profitable sector of the economy, and also controls the activities of the oil industry. The country is divided into 20 districts, called fylke, whose governors are appointed by the king. The counties unite the communes. The country has a multi-party system, and new political movements and parties are constantly emerging seeking to enter parliament. Trade unions, which have great authority, take an active part in the political and administrative life of the country.
General characteristics of the Norwegian economy
There are several countries in Europe that are successfully overcoming the financial crisis and finding growth opportunities, one of them is Norway. The country's economy, of course, is experiencing crisis influences, but still looks good compared to other states. The country ranks fourth in the world in terms of GDP per capita. Today, the state shows moderate growth, which is associated mainly with increasing consumption in the public sector. The export of consumer goods is slightly growing and the consumer activity of households is increasing. These processes are not radically positive, but against the backdrop of the situation in Europe, the Norwegians have reason to be optimistic. The government has to spend a lotmeans and efforts to maintain a predetermined high standard of living. And it is investing a lot in research and innovation in production, seeking to diversify the economy and reduce the economy's still fairly high dependence on the oil industry. In general, the Norwegian economy is built on the Scandinavian model of the "Welfare Country" and quite successfully along this path, although not without difficulties.
Structure
The dominant economic model of Norway has led to the fact that there is a specific alignment of production forces. The structure of the Norwegian economy shows a harmonious balance between market mechanisms and state regulation. The public sector occupies a significant part of the economy in the country. The state invests about 3% of GDP in the development of science and technology. The export-oriented model of the economy leads to the fact that the volume of exports exceeds imports. 38% of the country's GDP comes from exports, of which more than half comes from gas and oil. The government is working to reduce these indicators and there is progress, although small, it is possible to reduce the weight of exports by 0.1% of GDP per year.
Foreign economic activity of the country
Norway actively cooperates with many countries in terms of the exchange of goods, raw materials and technologies. The external economy of Norway is primarily connected with the countries of the European Union, as well as with China and some Asian countries. The state is a major energy supplier in Europe. Gas and oil are supplied to France, Germany, the Netherlands, Sweden, Great Britain. Norway also sellsabroad equipment, chemicals, pulp and paper products, textiles. Products of light and food industries, agricultural products, vehicles are imported into the country. The structure of the Norwegian economy depends on the sale of energy products abroad, the government has been fighting this phenomenon for the past 10 years, but the process of diversification is slow.
Extractive industry
Norwegian oil fields began to be developed relatively recently, since 1970. During this time, the country has confidently become one of the largest exporters of this energy carrier in the world. On the one hand, oil is an undoubted benefit for the country, it allows the state not to depend on external prices for hydrocarbons. But over 40 years of active production, the economy fell into a strong dependence and price fluctuations in the oil market began to lead to negative consequences. Today there are several countries in the world with a fundamental dependence on the situation in the commodity market, and one of them is Norway. The extractive industries account for almost half of the country's production. Today, in the context of the crisis in the oil industry, the country is being forced to intensify the development of other sectors of the economy.
Production areas
In addition to energy and hydrocarbon production, Norway has other serious industries. The economy of Norway can be briefly described as traditional with elements of innovation. The country is developing those industries in which it was historically strong. In particular, hershipbuilding has always been strong and advanced. Today, shipbuilding brings about 1% of the country's GDP. Norwegian shipyards assemble ships for oil transport companies, as well as for freight and passenger traffic. Another important industry of the country is metallurgy. The Norwegian economy is constantly stimulating the production of ferroalloys, but the industry is in crisis and is receiving government assistance. Metallurgy brings about 0.2% of GDP. The forestry and pulp and paper industry is also a traditional area of production for Norway. Fishing and agriculture are important areas of employment for Norwegians. In addition, the country is trying to develop innovative, knowledge-intensive industries. This is the field of astronautics, the country produces a diverse range of components and equipment for satellites. The sphere of computer technologies, construction, education is developing.
Tourism industry
Today, the Norwegian economy, where industry plays a crucial role, is actively developing another resource - tourism. This industry brings just over 5% of GDP and employs 150,000 people. The state annually selects one country in which a serious advertising campaign is carried out throughout the year to increase the awareness of tourists about the features of holidays in Norway. Attracting tourists to the northern regions of the country allows you to develop the infrastructure of this region and provides jobs for local residents who find it difficult to find a job in this uninhabited corner of the state.
Sphere of everyday life andservice
All developed countries follow the path of increasing the share of service activities and services in the structure of production, and Norway was no exception. The country's economy is increasingly becoming a service economy. The high quality of life leads to the fact that people in everyday life are less and less engaged in everyday life, leaving worries at the mercy of professionals. Catering, cleaning companies, repair, construction, maintenance of equipment, aesthetic services, he althcare, education and leisure - these industries are the most promising development niches in Norway. These areas of production are not controlled by the state and are developed to the maximum extent by small private companies.
Labor market
In an effort to maintain a high quality of life and move towards "general welfare", the Norwegian economy, in which the labor market is an important element, increases the number of jobs every year. There are special government programs aimed at creating small businesses and additional places for employment. At the same time, the country makes sure that as many people as possible get an education in order to contribute to the innovative development of the country. Norway today has the lowest unemployment rates in Europe (5%) and continues to reduce them.
Economy in numbers
The latest data on the economy in Norway show that it is growing steadily, albeit slowly, at 2.5% per year. GDP per capita is just over 89 thousand US dollars. The inflation rate is 4%, and the key rate is kept at 0.5%. Goldthe country's reserve is 36 tons. Government debt - 31.2%.
Prospects for development
Today Norway's economy is one of the most stable in Europe. The state strives for a fair distribution of income from the sale of hydrocarbons and develops the social sphere and industry. Despite the global financial crisis, the Norwegian economy and its prospects look quite optimistic. The state is steadily reducing its dependence on oil prices, developing innovative areas of production, maintaining a high standard of living, and actively resisting the migration pressure that has gripped Europe. Norway is one of the region's leaders in renewable energy production. Hydroelectric power plants, the use of solar and wind energy, allows the country to increase the export of electricity to nearby countries. Economic diversification, the development of innovative industries, the growth of tourist attractiveness - this is the key to Norway's economic success.
