INSIGHT
SEPTEMBER 2013
Norway's opposition Conservatives
have led a group of centre-right
parties to victory in the parliamentary
elections held on Monday 9
September.
Promising tax cuts and better
healthcare, the Conservatives - along
with the Progress Party, the Christian
Democrats and the Liberal Party won a majority in the Norwegian
parliament.
The new government, which is
expected to be formed during
October, will be led by Erna Solberg
(pictured), who will become Norway’s
second female prime minister and
the first Conservative PM since 1990.
Photo: CC/Flickr Nordiske Mediedager
The centre-right electoral pact won 96
seats in parliament, 11 more than
needed for the majority. This election
has seen the political balance shift
further than ever to the right.
The Conservatives, led by Erna
Solberg, won 48 of those seats, up
from the 30 seats it won in the last
parliamentary elections in 2009).
The Progress Party won 29 seats,
losing 12 seats compared to the
previous election, yet will enter
government thanks to the gains of the
Conservatives and the other coalition
partners.
The Christian Democratic Party won
ten seats (no change on its 2009
score), while the Liberal Party saw a
surge in its support and a leap in its
representation in parliament from two
to nine seats.
Together, the centre-right coalition
gained 13 seats, while the Red-Green
coalition - led by the outgoing prime
minister, Jens Stoltenberg, and his
Labour Party - lost 14 seats, falling to
a total of 72 MPs.
Labour won 55 of those 72 seats
(losing nine MPs), with the Centre
Party taking ten seats (down one)
and the Socialist Left Party seven
seats (losing four MPs).
The win for the centre-right means
that Mrs Solberg becomes the first
Conservative prime minister since
1990 and only the second woman to
hold the post, following Labour’s Gro
Harlem Brundtland, who was prime
minister three times between 1981
and 1996.
Despite the fall in its representation,
much international attention has
focused on the Progress Party, which
favours greater immigration controls
and is poised to enter government for
the first time.
The Party has been referred to as a
right-wing nationalist party in line with
Sweden Democrats and the Danish
People’s Party - although it sees itself
as being closer to Denmark’s Liberal
Venstre Party.
One MP was elected outside of the
two main blocs, with the Green Party
winning its first ever MP with a single
seat from the capital, Oslo.
Burson-Marsteller EMEA
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of
Norwegians
turned out to
vote in the
elections
The four centre-right parties have
started negotiations on the formation
of a new government. The hardest
task for the new Prime Minister, Erna
Solberg, will be to ‘tame’ the Progress
Party and to ensure an inclusive
government.
Support from either the Christian
Democrats or the Liberals will be
needed to construct a majority, but
these two parties are somewhat
reluctant to team up with Progress
Party, objecting to its policies on
immigration and spending. There is a
possibility that Mrs Solberg will lead a
minority government.
The new government will be
appointed by the end of October
(most probably on Friday 18 October
or Friday 25 October) following the
presentation of the state budget on
Monday 14 October.
Norway has enjoyed rare economic
success during the past decade. The
country has escaped Europe's
economic crisis with only minor
scratches. The offshore oil sector
lifted per capita GDP to US$100,000
and a huge public sector insulated the
economy. However, growth is now
slowing, competitiveness stagnating,
and the outgoing government's record
on critical social services has been
mixed.
The Conservatives promise to diversify
the economy away from oil, privatise
state firms, and reduce some of the
world's highest taxes rates to give the
private sector more breathing room.
Bringing the Progress Party into
government could force Solberg to
make concessions on spending, taxes
and immigration - although the
Conservative and Progress parties
agree about lowering income tax and
wealth tax.
In any case, the next government will
a large amount of leeway in terms of
its budget. It currently levies a 78%
tax on the oil sector, has a huge
budget surplus and a US$750bn oil
fund worth more than 150% of GDP a financial situation to be envied by
many other European countries.
One of the main topics for negotiation
between the parties will be changes
to the oil fund. Both parties want big
changes but do not agree on the
specifics, with the Conservatives keen
to get a broad consensus on any
reform to the fund.
The Progress Party wants to break off
smaller funds from the main fund and
spend more of the oil money
domestically, while the Conservatives
have proposed breaking the fund into
competing funds and do not want to
spend
as
much
oil
money
domestically as the Progress Party
proposes.
The centre-right parties are likely to
find common ground on privatisation
as they share an analysis that the
state has grown too big and that it
should sell some of its holdings in
companies such as Statoil and
Telenor.
Labour Party
Centre Party
Socialist Left Party
Green Party
55 (-9)
32.5%
Conservative Party
48 (+18)
28.4%
10 (-1)
5.9%
Progress Party
29 (-12)
17.2%
7 (-4)
4.1%
Christian Democrats
10 (-)
5.9%
Liberal Party
9 (+7)
5.3%
1 (+1)
Generally the new government will
seek to reduce tariff barriers and
more international trade.
The new government is also in favour
of a strong national defence, and
wants to start prioritising investments
in Norwegian defence capacities.
Membership of Nato will remain the
cornerstone of Norway’s security and
the basis of Norway’s defence policy.
The new government will not seek to
make any progress on European
Union membership: a recent poll
showed that fewer than one in five
Norwegians support EU membership.
Membership
of
Economic Area
the
(EEA)
of
Norwegians
want to join
the EU,
according to
a poll
published in
August; 70%
are opposed
European
will be
The Conservatives, the Progress Party
and the Liberal Party are advocates of
free-market economics, stating that
economic growth is brought about
through a solid financial framework
and free competition.
These parties want to give developing
countries the opportunity to undergo
economic growth and development
through foreign and by being allowed
to sell their goods to Norway
unimpeded by special duties and
restrictions.
For more information please contact:
Robert Mack
Chair, EMEA Public Affairs Practice
robert.mack@bm.com
0.6%
David O’Leary
Director, Government Relations, Brussels
david.oleary@bm.com
The outgoing
PM, Labour’s
Jens Stoltenberg
Photo: CC/Flickr
Arbeiderpartiet
maintained, and the new government
is likely to be more EU-friendly than
the one it replaced.
As a small but highly-developed
nation, Norway is among the biggest
players in the world in several
economic sectors. If the Norwegian
economy continues to grow as
forecasters predict, opportunities for
businesses to increase exports to the
country will increase.
While Norway’s oil and gas industry is
likely to be the sector of greatest
interest to many, Norway also has
other markets that lend themselves to
international trading opportunities. It
is, for example, the world’s second
biggest exporter of fish and seafood
products.
The new government is seeking to
speed up spending on infrastructure
projects (road, rail and ports) by using
public-private partnerships. The same
mechanism will be used in public
housing and property development
such as building new hospitals.
There is also a stated willingness to
balance the public and private
sectors, particularly in the healthcare
field.
Original text by Cecilie BreinKarlsen and Julie M Remen,
Burson-Marsteller Norway.
burson-marsteller.no
Ingrid Langerud
Director, Public Affairs, Norway
ingrid.langerud@bm.com