Economy of Norway: general characteristics

Northern Norway is known for its high standard of living. The country is relatively easy to survive the global financial crisis, and the economy shows stability and positive dynamics. What is the difference between the economy of Norway and other European countries? Let's talk about the peculiarities of the Norwegian economy, its structure, prospects.

Geography of Norway

The economy of Norway in a sense is due to the geographical location of the country. The state is located in the western part of the Scandinavian Peninsula, in Northern Europe. It strongly depends on the seas with which it is washed. The coastline of the country is 25 thousand kilometers. Norway has access to three seas: the Barents, the Norwegian and the 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 riddled with picturesque fjords. The main part of the country is mostly mountainous. From north to south stretches a mountain range, which in some places alternates with high 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 favorable plateau for agriculture. The country is very rich in fresh water, there are about 150 thousand lakes and many rivers, the largest of which is the Glomma. Norway is not very rich in various minerals, but it has serious reserves of gas, oil, several ores, copper, lead.

Climate and ecology

Norway is in the zone of influence of the warm Gulf Stream and this makes the local climate milder than those of the Alaska and Far Siberia located on 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 there is a mild maritime climate with mild winters and a short warm summer. Here a lot of precipitation falls every year. In July-August, here the air warms up to 18 degrees Celsius, and in winter it does not fall below two degrees below zero. The central part refers to a zone of temperate continental climate with a cold winter and a short warm, but not hot summer. In winter, the average temperature is 10 degrees below zero, and in summer the air warms up to 15 degrees Celsius. The extreme north of the country is characterized by a subarctic climate, with a long, harsh winter and a short cold summer. In winter, the average thermometer shows minus 20 degrees, and in summer the thermometer rises to a mark of 10 degrees of heat. In the North there is an atmospheric phenomenon - the northern lights.

In general, the economy of Norway can be briefly described as eco-friendly. Here great attention is paid to preserving the pristine nature. Although fishing and oil production cause some harm to nature, Norway can not cope with this yet. Nevertheless, there is very clean air and water, industrial enterprises operate according to high standards of safety, which are considered to be among the highest in the world. The growth of the tourist flow also represents a certain threat to the country's ecology and this problem has not found its solution either.

History of economic development

Until the 9th century, Norway was a country of conquerors. The Vikings terrified all of Europe, reaching up to the coast of Turkey. The main income of the inhabitants of the country was to collect tribute from the conquered lands. In 9-11 centuries the huge lands belonging to the Norwegian king, passed a way of reforming, in the region Christianity tries to penetrate several times, there is a struggle between separate areas, there are excitements of the people. The economy is undergoing serious changes. Territories subject to taxes are gradually being reduced, new forms of management were needed. In 1184 the former priest Sverrir comes to power, he strikes a powerful blow to the clergy and aristocracy and introduces new principles of the existence of the state - democratic. The next few generations of monarchs engaged in the centralization of the country and the settlement of political strife. At the end of the 13th century, Norway was experiencing a significant agriculture crisis, which was associated with the plague epidemic. This leads to a strong weakening of the state. Since the 14th century, Norway has been experiencing a long period of dependence on the Scandinavian states. This could not have a positive impact on the development of the economy. The country is increasingly becoming a peripheral state with a weak economy. In the middle of the 17th century, the country is experiencing a serious economic rise, caused by the collapse of the Hanseatic League. Europe is beginning to actively consume Norwegian raw materials: timber, ore, ships. There is an explosive growth of industry. But the country remained part of Sweden. In the early 19th century, Norway, led by Christian-Friedrich, was able to defend its rights to independence. But not for long. Sweden did not want to part with these territories. And the whole of the 19th century was a struggle for upholding the rights of the Norwegian people to their own government and legislation. At the same time, there is an increase in industrial production, which is becoming a platform for the emergence of a wealthy class that did not want to remain under Sweden's control. In 1905 the country managed to get rid of Swedish influence, the Danish prince came to power. During the First World War, the state adheres to neutrality, this allows Norway to significantly improve its economy. But the global economic crisis of the late 20-early 30-ies did not pass the country. At the beginning of the Second World War, Norway again decided to remain neutral, but Germany did not pay attention to it and seized the country. Post-war years became the formation of a state with a new economy. Here, to a greater extent than in other European countries, methods of fair income distribution are applied. At this time, the general characteristics of Norway's 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.

The population of Norway

The population of the country is slightly more than 5 million. The population density is only 16 people per square meter. Km. The main population is concentrated in the east of the country, densely populated coastal zone around Oslo, as well as in the south and west of the country. The northern and central parts are almost empty, and part of the islands are completely uninhabited. The economy of Norway today provides high employment of the population. About 75% of the population have a job. 88% of residents of the country with higher education do not have difficulties with employment, this is the best indicator in Europe. This indicates that the country's economy is developed at a very high level. The high quality of life is also indicated by the growing life expectancy of the Norwegians, 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 vested in a unicameral parliament. The king has a formally fairly large list of duties and rights. He appoints and dismisses the prime minister, approves the laws, controls the war and peace, heads the supreme court. But practically all the main issues of the country's leadership are dealt with by the government with the prime minister at the head. The executive power belongs to the right to carry out state regulation of the economy of Norway, it controls the work of the public sector of the economy, which is a highly profitable sphere of the economy, and also controls the activities of the oil industry. The country is divided into 20 districts, called the county, governors are appointed by the king. Fülke is united by communes. There is a multi-party system in the country , and new political movements and parties are constantly appearing, striving to enter the parliament. In the political and administrative life of the country active participation is taken by trade unions, which have great authority.

General characteristics of the economy of Norway

In Europe, there are several countries that successfully overcome the financial crisis and find opportunities for growth, one of them - Norway. The economy of the country, of course, is experiencing crisis influences, but still looks good against the background of other states. The country is on the fourth place 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 growing slightly and consumer activity in households is increasing. These processes are not radically positive, but against the background of the situation in Europe, the Norwegians have reasons for optimism. The state has to spend a lot of money and efforts to maintain a given high standard of living. And it invests a lot of money in research and innovation production, is looking for ways to diversify the economy and reduce the still highly dependent economy from the oil industry. In general, the Norwegian economy is built according to the Scandinavian model of the "Country of Welfare" and is quite successful in this direction, although not without difficulties.

Structure

The dominant economic model of Norway has led to the fact that a specific alignment of productive forces develops. The structure of Norway's economy shows a harmonious balance between market mechanisms and state regulation. The public sector occupies a significant part of the economy. The state invests about 3% of GDP in the development of science and technology. Export-oriented model of the economy leads to the fact that the volume of exports exceeds imports. 38% of the country's GDP is exported, of which more than half is gas and oil. The government is working to reduce these indicators and there are successes, albeit small, a year to reduce the weight of exports by 0.1% of GDP.

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 countries of Asia. The state is a major energy supplier of Europe. Gas and oil are supplied to France, Germany, the Netherlands, Sweden, Great Britain. Also, Norway sells equipment, chemicals, cellulose and paper products, textiles abroad. Imported into the country are products of light and food industries, agricultural products, vehicles. The structure of the Norwegian economy depends on the sale of energy carriers abroad, the government has been fighting this phenomenon for the past 10 years, but the process of diversification is slow.

Mining industry

Norway's 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 undeniable 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 in the world there are several countries with a solid dependence on the situation in the commodity market, and one of them is Norway. The sectors of the economy of the extractive industry make up almost half of the country's output. Today, in the context of the crisis in the oil industry, the country is being intensively engaged in the development of other branches of the economy.

Spheres of production

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 develops those industries in which it was historically strong. In particular, its shipbuilding has always been strong and advanced. Today shipbuilding brings about 1% of the country's GDP. Norwegian shipyards collect vessels for companies transporting oil, as well as for freight and passenger transportation. Another important branch of the country is metallurgy. The economy of Norway constantly stimulates the production of ferroalloys, but the industry is in crisis and it receives state aid. Metallurgy brings about 0.2% of GDP. The forestry and pulp and paper industries are also a traditional industry for Norway. Important areas of employment for Norwegians are fishing and agriculture. In addition, the country is trying to develop innovative, knowledge-intensive industries. This is the sphere of cosmonautics, the country produces a diverse assortment of components and equipment for satellites. The sphere of computer technologies, construction, education is developing.

Tourist industry

Today the economy of Norway, the industry in which plays a crucial role, is actively developing another resource - tourism. This industry brings just over 5% of GDP and gives jobs to 150 thousand people. The state annually chooses one country in which a major advertising campaign is conducted during the year to raise awareness of tourists about the peculiarities of recreation in Norway. Attracting tourists to the northern regions of the country allows to develop the infrastructure of this region and provides work for local residents who find it difficult to find work in this uninhabited corner of the state.

Sphere of life and service

All developed countries are following the way of increasing the share of service activities and services in the production structure, nor was Norway an exception. The country's economy is increasingly becoming a service economy. High quality of life leads to the fact that people in everyday life are less involved in everyday life, giving care to professionals. Public catering, cleaning companies, repair, construction, maintenance of machinery, aesthetic services, health care, education and leisure - these are the most promising development niches in Norway. These areas of production are not controlled by the state and are maximally absorbed by small private companies.

Labor market

In an effort to maintain a high quality of life and moving towards "universal well-being", the economy of Norway, the labor market in which is an important element, increases the number of jobs annually. There are special state programs aimed at creating small businesses and additional places for employment. At the same time, the country takes care that as many people as possible get education to contribute to the country's innovative development. Norway today has the lowest unemployment figures in Europe (5%) and continues to reduce them.

Economy in figures

The latest information about the economy in Norway shows that it is stable, albeit slowly, growing, by 2.5% per year. GDP per capita is slightly more than 89 thousand US dollars. The inflation rate is 4%, and the key rate is kept at the figure of 0.5%. The country's gold reserves are 36 tons. The state debt is 31.2%.

Development prospects

Today the economy of Norway is one of the most stable in Europe. The state strives for a fair distribution of revenues from the sale of hydrocarbons and develops the social sphere and industry. Despite the financial crisis in the world, Norway's economy and its prospects look quite optimistic. The state steadily reduces its dependence on oil prices, develops innovative production sectors, maintains a high standard of living, and actively opposes the migration pressure that has engulfed Europe. Norway is one of the leaders in the region in the production of renewable energy. Hydroelectric power, the use of solar and wind energy, allows the country to increase the export of electricity to nearby countries. Diversification of the economy, the development of innovative industries, the growth of tourism attractiveness - this is the guarantee of Norway's economic success.