For the most part, you wouldn’t know an economic crisis is going on across the world. Sure, Statoil’s profits are way down, but unemployment and wage growth still look great compared to the rest of the world:
OSLO, Feb 16 (Reuters) – Norwegian wage growth is seen moderating in 2009 after years of brisk increases as the labour market weakens, economists said on Monday following a state commission’s estimate of the impact on 2009 wages from pay hikes last year.
Unemployment is rising in Norway because of the global economic downturn, but remains low by international standards. Registered joblessness rose to 2.6 percent of the workforce in January from 2.0 percent in December.
While I have heard people mention the economic crisis, it certainly hasn’t impacted the lives of most Norwegians. Although, perhaps there is a bit more to come if law firms are giving talks like this one.
That financial crisis that seems to be hitting the US hard? It’s hitting Norway hard too, or at least the Norwegian oil fund.
The oil fund, technically called “The Government Pension Fund – Global,” is one of the largest sovereign wealth funds in the world. Although those funds have received a lot of criticism recently because of their lack of transparency, Norway’s fund has mostly escaped the backlash. Perhaps it’s time for the Norwegian people to demand a bit more transparency, however?
In light of the collapse of Washington Mutual:
Norway’s so-called oil fund had shares worth NOK 168 million in Washington Mutual at the beginning of this year. That money likely has been lost, unless the oil fund sold off its holding.
Uncertainty is building around the oil fund, because it only releases information on its current holdings once a year. No information was immediately available on whether the fund still had Washington Mutual stock in its vast holdings…
…[Including debt obligations, however,] the oil fund’s exposure in Washington Mutual was over NOK 8 billion (well over USD 1 billion), and that money may now be lost as well.
But the person running the fund will at least reassure the Norwegian people, right?
Norwegian Finance Minister Kristin Halvorsen, ultimately responsible for the oil fund, has resisted commenting in detail on effects of the US financial crisis, noting that the next quarterly report from the oil fund will be released next month.
At least some reporting is better than none. Ever.
OSLO, Sept 16 (Reuters) – Global liquidity problems hit oil-rich Norway on Tuesday, freezing its U.S. dollar-based money markets, driving down the crown and stocks and triggering $17 billion in emergency cash injections by the central bank.
Norges Bank tried to calm wobbly markets, telling Reuters it would inject more liquidity “when and if” needed and Norway’s Finance Minister Kristen Halvorsen played down the impact of the U.S. banking crisis on the Norwegian economy and finances.
Raise your hand if you believe Halvorsen’s attempt to play down the impact of the US banking crisis. Anyone? Bueller?