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Political Economy

Jens Stoltenberg has spent over Nkr600 billion kroner of the oil money

Thursday, 20 December 2012
The Norwegian Prime Minister, Jens Stoltenberg has access to a pool of Norwegian money to spend. The question being asked is how much he has spent and whether he has spent the money effectively.

Since Jens Stoltenberg took over as prime minister in 2005, he is said to have collected and used Nkr628.4 billion which is of oil money. There has been increased debate about how the money has been spend and how that has affected the Norwegian economy around him. Stoltenberg is keen to make it clear that the money is well spent.

"The money has gone to safeguard the Norwegian economy, to develop the Norwegian welfare and investing in knowledge," Stoltenberg told the Norwegian business daily, Dagens Naeringsliv.

Chief Economist, Steinar Juel of the Nordic biggest bank, Nordea, points out the downside of opening the monetary floodgates.
"The consequences are that you get a stronger expansion in the economy, contributing to a sharp upturn in the property market. It can also contribute to a cost that is significant - both for high wages and strong Krone. This could mean faster dismantling of industries that are not directed against oil business, and we risk a little hard landing in the property market in the future," said Juel to the paper

Norway has now become an overheated economy, due to the much more effects from the oil sector than the domestic use of oil revenues, according the economic professor, Victor Norman.

The government according to some authorities has had justifiable actions that most people can agree on. Whether it has been reasonable is another question, people are saying.
by Scancomark.com Team

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