Impact of immigration on Norway

Like many developed countries,Norway faces the challenges of an ageing population this is mainly due to ; the combination of demographic effects of the baby booms that marked the immediate post-war period, the fall in fertility rates that began from the late 1960s, and longer life expectancy. This have implications on the sustainability of the pension and benefit systems and for labour market equilibrium. Since there are more elderly persons and fewer young persons, Norway is expected to experince a fall in labour supply within the next few decades. This implies that more people of foreign origin will have to enter the labor force. Inflow of aliens in the country have made immigration and immigration policy a major issue in Norway. Norwegian people are concerned that immigration reduces employment opportunities for existing workforce, depresses wage rates in already low wage labour markets, and financially strains taxpayers via their receipt of transfer payments and use of social service programmes.

Norway: Investing oil revenues abroad

Since 1996, the government of Norway has transferred oil related fiscal surpluses (averaging 5% of gdp anually) to the state petroleum fund (s.p.f), which invests solely in foreign securities; mainly as a result of this policy Norway's net external assests have increased from 3.7% of g.d.p in 1996 to an estimated 17.2% of g.d.p in 2000.The spf plays an important role in moderating real appreciation of the krone (Norwegian currency). The s.p.f also helps smooth out the fluctuations in oil revenues. The fund is designed to absorb today's budget surpluses fuelled by Norway's oil and gas, in order to help the aging population when the oil wells run dry.

Norges bank which manages the fund has delegated the funds management to different institutions. Mercury Asset Management handles the U.K portofolio. Capital International, Gartmore Investment Management and Storebrand Kapitforvaltning jointly manage non-U.K European equities. While Fidelity Pensions Management oversees the non-Japanese Pacific Rim portofolio.

Norway: the economic success

Although Norway is not a member of the European Union, it has been a success in terms of its economy. Norway allows free trade. This has proved to be very helpful to Norway since it has a low unemployment rate.

Since Norway has an absolute advantage in oil,machinery,fish and metals it exports these to Canada and imports ore mattes, concentrates, machinery and aircraft parts from Canada.