DOC

Bilateral trade Norway Israel

By Derrick Gonzalez,2014-12-16 08:56
16 views 0
Bilateral trade Norway Israel

     Norway At A Glance

     Total exports/imports in million NOK

     2008: 184/427 (Jan-June)

     2007: 449/634

     2006: 560/649

     2005: 429/563

    The trade between the two countries has increased since the second intifada. Compared to that of Finland and Sweden the trade is still very small, almost one third. Norway's main expertises are: Oil & Gas, Shipping services, Hydropower, Telecommunication (ICT) and fish farming. The Telecommunication market is still held by Telenor which the Norwegian state owns 53%. They have successfully managed to grow through their success in emerging markets (Baltic, Asia and Russia). The Scandinavian market is still controlled by Scandinavian companies. Israel companies can get into this market mainly through consumer ICT solutions in cooperation with market leaders.

    Some Norwegian hi-tech companies are now doing very well on the virtualization (virtual machines). The market leader on the issue is working with VMware, which also has offices in Israel. Moreover, there is a growing market in Internet-connected handheld devices software, many predicting a higher use of internet over the phone, which will need faster network and better graphics solutions.

    In 2007 there was an increase in the sale of wine, (4.7%) Surprisingly there is only one Israeli wine in the Wine Monopoly (polet), which in turn is owned by the government, consequently there should be no reason why there are not more Israeli wines, the only problem could be, is that all import and distribution is done by Arcus AS which was owned by the state, but turned private. The same story is the same for the Swedish wine monopoly. Israeli wine should be able to compete in quality and price.

    Norway is almost self-sufficient on hydropower, this year they are even exporting electricity through new cables, which can transport in bigger quantity to Denmark and Holland. There is a joint North-project on creating wind mills at sea, currently only on paper. Norway has a strong solar energy company, REC, which have managed to have full orders until 2011. There could be a growing demand for solar panels on private houses, still no government law proposal on the issue.

    On the Issue of Security, the finding of Oil & Gas close to the north-pole, have stirred uncertainty among the countries which have rights in the region (Russia, USA, Greenland, Canada and Norway) Russia planted a flag and Canada is building more coastal guard ships to control the area. Lastly, securing of oil searching and production in emerging markets could be an area of interest.

     Primary Industry

     From Agriculture to aquaculture

    Water management in agriculture products could be a possibility. The agriculture in Norway is on the decline; today agriculture share of GDP is 0.5 per cent, more people are selling their farms. Nevertheless, the total agricultural area is unchanged because the land belonging to

     these abandoned farm holdings has been taken over by other farms.

    The Ministry of Agriculture’s target is that at least 10 per cent of the agricultural area should be used for organic farming by 2010. However, holdings with organic farming account for only 4 per cent of the agricultural area as against more than 6-7 per cent in the other Nordic

     countries.

     Norway is number ten on the list of the world’s largest fishing nations.

    China heads the list (16.8 million tonnes), followed by Peru, United States, Indonesia and Japan. The cod catch has the highest value in economic terms, followed by herring, mackerel,

     saithe, shellfish and molluscs.

     Salmon: our new domestic animal

    The production of farmed fish has grown sharply since the start in the 1970s, amounting to 635 000 tonnes in 2004. Salmon dominates the fish farm industry, while in recent years the

     production of trout is on the increase.

     However, other species are also becoming of greater interest: In

    2004, more than 3 000 tonnes of mussels were produced, and cod is also growing in popularity at over 3 100 tonnes. The total export value of fish and fish products was approximately NOK 28 billion in 2004. Exports of fish therefore account for 5 per cent of total export revenues. 50 per cent of fish exports go to EU countries, while Denmark is the largest

     export market country.

     Secondary Industry

    From manufacturing to oil

    The rise and fall of manufacturing

    Seen as a whole, secondary industries (manufacturing, mining and quarrying, oil extraction, building and construction, electricity and water supplies) have seen a slight decline in employment over the last 30 years to 476 000 employees today. However, relatively speaking the decline is greater, and secondary industries today account for 20 per cent of the employed as against one-third until around 1970.

Oil and gas: rise in production...

    Oil production has increased steadily since the start in 1971 apart from a drop at the end of the 1990s. Production of natural gas started at the end of the 1970s and production remained steady between 20 and 30 million Sm3 oil equivalents for a long period of time. It started to rise in the mid-

    1990s and today constitutes 30 per cent of the total production, a percentage that is expected to increase in the coming years.

... but relatively few employees

    From the modest beginning in 1972, employment in oil and gas extraction gradually increased to 16 500 employees today. In addition, 13 000 are employed in activities related to petroleum industry. If we include employees in various supply services, the total number of employees in oil and gas-related activities amounts to 75 000 approximately.

Norway’s share of the world’s oil and gas reserves is just below 1 per cent, but we now

    contribute 4.3 and 2.8 per cent, respectively, to the annual oil and gas production. This implies that the lifetime of Norwegian reserves is considerably shorter than for the world’s total reserves, especially in the case of oil.

Money in the bank

    Oil revenues will gradually decrease and the increase in the number of elderly people will lead to higher pension, nursing and care expenditures. The

    Government Pension Fund (the former Government Petroleum Fund), administered by the Central Bank of Norway, is therefore established, and it is funded by oil revenues that are not allocated in the Government Budget. This fund has increased from NOK 48 billion in 1996 to NOK 1 400 billion at the end of 2005 to 1 945.8 billion NOK per 31 March 2008.

Tertiary Industries

    Three out of four work in the service sector

    Altogether employment in the tertiary or service industries has grown from 750 000 at the beginning of the 1960s to 1 766 000 today, representing almost 75 per cent of the employed. The dominance of the tertiary industries has encouraged many general designations of modern society, such as ‘the post-industrial society’, ‘the information society’, and ‘the service

    society’.

    This sector comprises many diverse industries, e.g. commodity trade, hotels and restaurants, transport, financial services and tourism. However, the largest service sector is the public sector i.e. local and central government administration including social services, health,

    education, administration etc.

ICT: a new sector

    The ICT sector consists of a number of industries in information and communication technology, such as the manufacturing of computers and computer equipment, electronic trade, telecommunication and consultancy services.

    In other words, this sector cuts across the traditional division of industries and includes production of both goods and services.

    The ICT sector employment increased until 2001, but has declined somewhat in the recent years. In 2004, 68 600 people were employed in this sector. If we include the so-called content sector, which comprise publishing industries, information services, radio and television and film and video, more than 100 000 people are employed in the information sector.

    During 2007 a new major grouping arose in the Norwegian ecom market, comprising Bredbåndsalliansen, Banetele, Ventelo and Network Norway, among others. Telenor remains clearly the biggest, which TeliaSonera2 is next-biggest.

Mobile Broadband Prospect

    The trend whereby fixed-line telephones are being replaced by mobile phones continues. Now the Internet, too, is becoming increasingly accessible via the mobile networks through the rapid development of mobile broadband. Bandwidth is steadily increasing thanks to the introduction of new, advanced radio technologies in these networks. The wireless communications technologies WLAN and WiMAX are also making contributions in this regard.

    There are three companies that have virtually all subscriptions for mobile broadband. They are Telenor, NetCom and Nordisk Mobiltelefon under the brand Ice. At the end of 2007 there were nearly 87,500 subscriptions, an increase of around 48,000 since the end of 2006. At the end of 2007, Telenor had 42.7 per cent of subscribers, while NetCom had 36.3 per cent and Ice 21 per cent. A majority of the customers with Ice are consumer customers, while the majority with Telenor and NetCom are business customers.

    There are several suppliers of leased lines. Telenor has nationwide coverage both in transport (trunk segments) and access (terminating segments). Other suppliers can cover local, regional or national areas with trunk segments of leased lines and, in some cases, terminating segments of leased lines. To provide transmission capacity, Telenor’s competitors

    usually have to lease supplementary trunk lines and access lines from Telenor.

    In 2007 traffic from VoIP for residential customers totalled around 1.7 billion minutes, against 1.3 billion in 2006. This is equivalent to about 26 per cent of the total traffic in 2007, against

    16 per cent in 2006. Traffic from VoIP accounted for about 2 per cent of the total traffic in the business market in 2007.

Decreasing value of ICT imports

    External trade in ICT goods increased by 8.7 per cent to NOK 15.4 billion from 2006 to 2007 Imports fell by 0.3 per cent in this period, whereas the trade deficit came to NOK 24.5 billion. Computers and related equipment dominated on the import side

    From 2002 to 2007, exports and imports of ICT goods increased by 42 and 43 per cent respectively. This is an increase in exports of NOK 4.5 billion and an increase in imports of NOK 12 billion. However, the growth in external trade in ICT goods has been lower than the growth in total external trade. From 2002 to 2007, total exports increased by 68 per cent and total imports by 71 per cent.

     Structural changes in business and industry

    During the last 50 years, Norwegian business and industry have seen some dramatic structural changes. Generally speaking there has been a move from primary and secondary industries towards tertiary industries. Agriculture and manufacturing have lost out to service industries with the result that we are less likely to work on farms and in factories and more

     likely to work in shops and offices.

    Primary industries now comprise barely only 4 per cent of the employed and secondary

     industries around 20 per cent, while the tertiary industries account for a total of 76 per cent.The picture is slightly different if we look at the significance of these industries in the light of their contribution to GDP, or rather, their contribution to gross domestic product in total (in

     basic values).

    Primary industries contribute scarcely 2 per cent, secondary industries closer to 39 (with petroleum activity contributing far more in economic value than in employment) and the tertiary industries 59 per cent.

Trade with Sweden

    Sweden is our most important trading partner both for imports and exports.

    Import from Sweden now stands at 15 per cent and export at 13 per cent. Then comes Germany where Norway has an import surplus. It should be noticed that China now is our fifth most important trading partner for import.

    Approximately 70 per cent of our export goes to EU countries and the same amount import come from these countries. 13 per cent of the import is from developing countries.

Oil and vehicles

    As regards export, oil and gas dominates, followed by metals (especially aluminum) and fish. For import, motor vehicles (cars and buses) and other means of transport (planes and vessels) dominate.

     High electricity consumption

    Electricity is an important energy source in a mountainous country like Norway with large

    hydropower resources. Norway has the world’s second highest electricity consumption per

    inhabitant: 23 200 kWh. This is almost three times greater than the OECD average:

    approximately 8000 kWh. The figure includes electric consumption in all sectors, not just the

     household sector.

     ... and more waste

    Economic growth and increased prosperity also generate huge amounts of waste. In 2004 we

    produced altogether 8.6 million tonnes of waste; in other words, almost 2 tonnes per person.

    Since 1995, there has been an increase of more than 1 million tonnes. Nevertheless, the

    increase in the volume of waste in the 1990s is approximately at the same level as the

     economic growth, measured in GDP.

Report this document

For any questions or suggestions please email
cust-service@docsford.com