Norway flag Norway: Economic and Political Overview

The economic context of Norway

Economic Indicators

For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.

Norway's Covid-19-led economic downturn remained limited compared to most European countries, with GDP growing an estimated 3.6% in 2022 (from 3.9% one year earlier – IMF). Though still strong, private consumption (which accounts for 45% of GDP) decelerated in 2022 due to inflation pressures and declining consumer confidence. In the same year, Norway benefited from higher oil and gas prices (the country’s main exports) and increased exports to Europe following the EU sanctions against Russia (Norway’s exports almost doubled in the first eleven months of 2022). High inflation and policy tightening will weigh on domestic demand in 2023, as the worsening economic situation of the main trading partners will also contribute to a deceleration in the growth rate, forecasted at 2.6% this year and 2.2% in 2024 by the IMF (0.7% and 1.3%, respectively, according to OECD).

Norway’s public finances are sound. Norway's government gross debt did not expand substantially in the aftermath of the Covid-19 crisis unlike in the rest of Europe, despite public monetary support and a comprehensive loan programme to the banks. In 2022, the debt-to-GDP ratio was estimated at 40.3%, down from 43.4% one year earlier (IMF). The ratio is expected to follow a downward trend over the forecast horizon, at around 39%. The government budget deficit also decreased: it was estimated at 8.6% of GDP in 2022 compared to 10.1% one year earlier, thanks to direct transfers from the oil industry and withdrawals from the sovereign wealth fund. The household electricity support scheme will be extended into 2023 at a cost of around 1.2% of mainland GDP. Overall, the IMF forecasts a deficit of 8.1% this year and 8.2% in 2024. Moreover, the 2023 budget envisages a 9.4% reduction in the spending from the Government Pension Fund Global, to NOK 316,8 billion (official government figures). Such contractionary fiscal policy should help reduce inflation, which reached its highest levels in decades in 2022 (4.7%). In the same direction, the Norges Bank increased the policy rate further in November by 0.25 percentage points to 2.5%. Inflation is expected to decelerate gradually to 3.8% in 2023 and 2.7% the following year.

Norway is a rich country, with one of the highest GDP per capita in the world (estimated at USD 78,128 PPP in 2022 by the IMF). The nation also scores at the top of the United Nations’ Human Development Index ranking. Unemployment stood at 3.9% in 2022 and the labour market remained tight. The government expects employers to continue to experience problems in recruiting within several professions in the short term, with unemployment projected at 3.8% in 2023 (IMF).

Main Indicators 20222023 (E)2024 (E)2025 (E)2026 (E)
GDP (billions USD) 579.42546.77567.74571.22575.77
GDP (Constant Prices, Annual % Change)
GDP per Capita (USD) 105,82699,266102,459102,473102,672
General Government Balance (in % of GDP) -7.0-7.4-8.0-8.1-8.1
General Government Gross Debt (in % of GDP) 37.137.436.336.235.9
Inflation Rate (%) n/a5.
Unemployment Rate (% of the Labour Force)
Current Account (billions USD) 174.74143.30144.09130.58115.23
Current Account (in % of GDP)

Source: IMF – World Economic Outlook Database, October 2021

Main Sectors of Industry

Agriculture accounts for 1.6% of GDP and employs 2% of the workforce (World bank, latest data available). Fishing is an important activity as Norway is the world's second-biggest seafood exporter after China. Agricultural subsidies are very significant. The country counts 38,076 agricultural holdings (of which 1,954 are certified organic farming holdings - Statistics Norway) and is more than self-sufficient in animal products, livestock being one of the major agricultural subsectors. However, Norway remains dependent on imports for cereal crops (soybeans, wheat, rapeseed and bananas). About 33.4% of Norway’s total land area is covered by forests, 12.6 million ha in total.

Industry employs 19% of the workforce and represents 35.5% of GDP. Norway’s economy depends on its natural resources and energy sources (oil, gas, hydraulic energy, forests and minerals). Oil rents, which have once dominated the GDP, now provide less than 4% of GDP, well below its peak level in 2000. Nevertheless, the oil and gas sector is Norway's largest measured in terms of value-added, government revenues, investments and export value. The government’s total net cash flow from the petroleum industry was estimated to be NOK 1,316 billion in 2022, marking a consistent increase due to higher estimates for oil and in particular gas prices amid the Russia-Ukraine conflict. Manufacturing accounts for 5% of GDP. Shipbuilding, metals, wood pulp and paper, the chemical industry, machinery and electrical equipment make up Norway’s main manufacturing industries. Norway also has one of the largest and most modern fleets in the world.

The Norwegian service sector is highly developed; it employs over three-quarters of the population (79%) and accounts for 52.5% of GDP. According to Statistics Norway, tourism consumption stood at NOK 129,750 million in 2020 (latest data available), accounting for 6.8% of total employment. The Norwegian banking sector is comprised of 136 banks of which 118 are local banks and 18 are branches of foreign banks. The market share of the subsidiaries and branches of foreign banks were 24% and 37% in the retail and domestic corporate markets, respectively (European Banking Federation, latest data available).

Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 2.3 19.2 78.5
Value Added (in % of GDP) 1.6 48.7 42.1
Value Added (Annual % Change) 2.0 0.3 5.5

Source: World Bank, Latest Available Data. Because of rounding, the sum of the percentages may be smaller/greater than 100%.


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Indicator of Economic Freedom


The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.}}

World Rank:
Regional Rank:

Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation


Business environment ranking


The business rankings model measures the quality or attractiveness of the business environment in the 82 countries covered by The Economist Intelligence Unit’s Country Forecast reports. It examines ten separate criteria or categories, covering the political environment, the macroeconomic environment, market opportunities, policy towards free enterprise and competition, policy towards foreign investment, foreign trade and exchange controls, taxes, financing, the labour market and infrastructure.

World Rank:

Source: The Economist Intelligence Unit - Business Environment Rankings 2020-2024


Country Risk

See the country risk analysis provided by Coface.

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Sources of General Economic Information

Ministry of Agriculture and Food
Ministry of Trade and Industry
Ministry of Foreign Affairs
Statistical Office
Central Office for Statistics
Central Bank
Central Bank of Norway
Stock Exchange
Oslo Børs - Oslo Stock Exchange
Economic Portals
Portals to the World: Norway

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Latest Update: November 2023