High growth in demand from the petroleum sector and low interest rates are key drivers in the development. Activity growth, however, is set to be more moderate than in previous upturns, SSB predicts.
They say a weak international growth outlook will also curb growth in Norway. Business investments in the mainland economy are therefore expected to make a considerably smaller contribution to the upturn than has been the case in the past. Growth in domestic demand will gradually be reduced, but this will, to some extent, be offset by a slight upturn in international growth.
The SSB outlook states that international growth is very weak and is still marked by the repercussions of the financial crisis and central government’s financial problems in many countries. The boost from a number of large emerging economies has also been reduced.
From a very low level, SSB assume that growth among Norway’s trading partners will carefully pick up from next year. Not until 2015 will growth have reached a sufficient level to increase capacity utilisation and dampen unemployment. Impaired cost-related competitive power in Norway and poor international growth will lead to very moderate growth in Norwegian exports excluding petroleum, but developments in exports will pick up slightly going forward. The traditional export of goods is not expected to surpass the pre-financial crisis peak until 2015.
At 4.2 per cent, annual salary increases in 2012 are expected to be the same as last year. Widespread weak profitability in the internationally-exposed manufacturing industry is expected to lead to somewhat lower wage growth in 2013, SSB states.