Norway is studying the impact on its economy of the US and Europe’s deteriorating ties to Russia and will step in to support industries that may be affected, Finance Minister Siv Jensen said.
“We are ready to act if necessary,” Jensen said today in an interview at her office in Oslo. “We are going through the Russian sanctions as we speak; it’s too soon to tell how they will influence the Norwegian economy.”
The fallout of the sanctions, and Russia’s counter move to impose an import ban on some western-produced foods, has already fueled dismay in a number of European countries concerned about the economic cost of such measures. Finland and Poland have even discussed the need for compensation.
“We have a good dialogue with the affected industries,” Jensen said.
The net cost to Norway, Scandinavia’s richest economy and western Europe’s biggest oil and gas producer, is so far unclear. Danske Bank A/S estimates that only about 1 percent of Norwegian exports are destined for Russia, mostly marine products. Norway may be more exposed through its energy industry.
“If the crisis escalates and changes the outlook for the European or global energy markets, the effects on the Norwegian economy could increase,” Frank Jullum, Danske’s chief economist in Oslo, said in a note. “If energy prices rise sufficiently to create a negative supply-side shock to the global economy, the effect would be negative. On the other hand, if energy prices remain subdued but Norwegian gas exports to Europe increase to replace Russian gas, the effect could be positive.”
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