The Royal Ministry of Foreign Affairs, Oslo
Press Division – Editor: Benedicte Tresselt Koren

Norway Daily No. 155/02

Date: 19 August 2002

Bondevik: Norway with twin focus at UN summit (NTB/Sunday)

"Norway will take the initiative as a bridge builder between north and south at the UN’s World Summit on Sustainable Development in Johannesburg," said Prime Minister Kjell Magne Bondevik. But he is refusing to comply with the demands of a number of developing countries and cut Norwegian agricultural subsidies. "We will take the initiative to ensure that the Summit’s resolutions are as concrete as possible. But we can also play a role as a builder of bridges between north and south. We have the trust of the developing countries and, even though we are only a small country, we have played an active role in the preparations for the summit," said the PM, who will himself be leading the Norwegian delegation to the Summit, which opens on 26 August.

Valla: Gjedrem fanatical about low inflation (NTB/Sunday)

Gerd-Liv Valla, president of the Norwegian Confederation of Trade Unions (LO) has launched a fierce attack on Svein Gjedrem, Governor of the Norwegian Central Bank. "Mr Gjedrem is fanatical about maintaining a low level of inflation and is ignoring issues of employment and production," she said in an interview with NRK on Sunday evening. She has now called on Finance Minister Per-Kristian Foss to raise the question of how the Norwegian Central Bank’s mandate should be interpreted. Ms Valla points out that Bank’s mandate stipulates that it should take employment and production into consideration in its decision-making. "It seems as though Mr Gjedrem has completely forgotten that aspect of the economy, and someone should remind him of it in no uncertain terms," she said. Ms Valla thinks that Mr Foss (Con) is the most appropriate person to take Mr Gjedrem to task, though in a way that does not conflict with the separation of roles between the Finance Minister and the Norwegian Central Bank. Mr Foss has no such plans.

Airlines threaten to axe flights (Aftenposten)

The Civil Aviation Authority (CAA) has published proposals to restructure its airport charges in a way which the airlines believe will devastate the Norwegian air transport industry. The airlines have calculated that the change will cost an additional NOK 1 billion a year. And if they are to meet these increased costs they see no alternative to a major cut in the number of flights being scheduled. Airports in the north of Norway and the northern part of the west country are most vulnerable to cuts in services. Air fares could also rise. Industry representatives agree that the new budget airline, Norwegian, which recently won a major contract from the Norwegian state, will suffer most.

DnB suspected of trying to buy Storebrand on the cheap

Storebrand’s management has strongly hinted that the wave of negative press about the company could be a smear campaign orchestrated by Svein Aaser’s Den norske Bank (DnB) with the aim of buying Storebrand on the cheap. Since the merger negotiations between Storebrand and DnB broke down there has been a stream of negative rumours and references to Storebrand in the press. Yesterday Finansavisen published the contents of an internal memo from Orkla Enskilda, a firm of stockbrokers, which tore Storebrand to shreds. The memo claims that Storebrand is an example of how not to run a life insurance company, asset management company or bank, and it hints that the word "bankruptcy" will soon be appropriate.

Cannot stand any more (Dagens Næringsliv)

Storebrand’s employees have had enough. Orkla Enskilda’s report claiming the company was close to bankruptcy comes on top of two or three years of scandals, crises and failed merger attempts. "Will it never end? Storebrand’s employee just cannot stand much more of this," said Rune Eikeland, employee representative to Storebrand’s board of directors. "This latest assault has not only left us reeling, but has infuriated employees, who feel we have not been given an opportunity to defend ourselves in a situation where the company is almost on its knees," said Mr Eikeland. Storebrand’s employees are also beginning to wonder if someone is out to damage the company, though Mr Eikeland declined to speculate on who might want to do so. Storebrand’s head of corporate communications, Egil Thompson, has hinted broadly that DnB, whose head offices lie not a stone’s throw from Storebrand’s own at Aker Brygge in Oslo, is behind some of the leaks indicating that Storebrand is facing huge potential losses which have weakened public confidence in the company.

Christian Democrat ministers keep tabs on Conservatives (Verdens Gang)

The Christian Democrats have set up a highly secret political surveillance system within the Government in which Christian Democrat ministers shadow selected Conservative ministers. The aim is to prevent the Conservatives from dominating the Bondevik government’s policies and profile as strongly as they have done so far. By adopting unconventional methods the Christian Democrats intend to secure greater political influence for themselves – also in ministerial areas which they do not control. Neither the Conservative Party leadership nor Conservative ministers have been told that they are being shadowed by Christian Democrats within the Government.

Row over establishment of parliamentary office in Brussels (Aftenposten)

Experts and politicians have long agreed that Norway’s influence in Brussels is minimal. Nevertheless, many politicians are sceptical about proposals for the Storting to establish an office in the city. Following requests from the Christian Democrats, the Liberals, the Centre Party and the Socialist Left Party during the debate on the Labour government’s report on Europe last summer, the Storting’s administration has examined the possibility of setting up a modest office, consisting of one official with secretarial assistance in Brussels. Many Norwegian companies and organizations have representative offices in the EU capital. In practice Bellona, the Norwegian Confederation of Trade Unions (LO) and the Confederation of Norwegian Business and Industry (NHO) have greater day-to-day influence on the EU than the Norwegian Storting and the country’s government.

Giske asked to solve gender issue (Verdens Gang/Saturday)

"If Trond Giske means what he says about being a ‘woman’s man’, he must challenge one of the other men in the Labour leadership if he becomes deputy leader of the party, demands Ingunn Yssen, leader of the Norwegian Centre for Gender Equality. She is herself a long-serving member of the Labour Party, and has previously held a number of key positions within the party, including those of political adviser and State Secretary. Throughout his political career Trond Giske has been an outspoken supporter of gender equality. "Mr Giske must take the initiative and declare how he, as deputy leader, intends to solve the gender issue within the Labour leadership," said Ms Yssen.

Passengers abandon NSB (Nationen)

The state-owned railway company, NSB, has lost over 10 per cent of its passengers in the past year. 27,200 fewer passengers travelled on NSB’s inter-city trains in July this year compared with the same month last year. In the period to 1 July the number of passengers travelling by train sank by almost 20,000. "Obviously, we are not very happy about this," said Audun Tjomsland, head of corporate communications at NSB. But he added that NSB was not the only company struggling with lower passenger figures. People are generally travelling less this year than last. Most of the passengers lost by NSB have switched to the express bus routes. Some students have also abandoned NSB after the Government’s contribution to student fare discounts was withdrawn.

Worth Noting

• According to Lars Sponheim it is no longer guaranteed that the Government will keep its promise to cut NOK 30 billion from the country’s tax bill. The Liberal Party leader has also completely ruled out the prospect of any resurrection of the centre alliance coalition between the Christian Democrats, Liberals and Centre Party. "Since the election the Centre Party has been moving further and further to the left, has taken a consistent position on the socialist side and has written itself out of the centre," said Mr Sponheim.
  (Aftenposten/Sunday)
• Members of the Norwegian Confederation of Trade Unions (LO) have never before paid so much in union dues. Yet the 17 largest LO unions still ended last year with an operating loss of NOK 92 million. Despite the fact that the LO unions’ finances were not reduced to any great extent by industrial disputes, the accounts of the largest unions are deeply in the red. The LO’s chief accountant is concerned.
  (Dagsavisen/Saturday)
• According to Statoil’s finance director Inge K. Hansen, state ownership is a blessing. "State ownership in major Norwegian listed companies is insurance against an Enron-style scandal," said the former stock broking star.
  (Aftenposten)
• According to a recent opinion poll, 21.5 per cent of those questioned believe there will be a change of government this autumn, while a substantial 63.5 per cent believe the Bondevik government will remain in office. Progress Party voters believe most strongly in a government crisis. 37 per cent of them detect the possibility of a change in government.
  (Nationen)
• DnB paid almost NOK 1.8 billion for ten per cent of Storebrand’s shares, which were to have been the bank’s entry ticket to a merger between the two companies. Yesterday afternoon those shares were worth barely NOK 740 million.
  (Dagbladet/Saturday)
• A survey carried out by the Central Research Office for Agricultural Associations shows that fewer and fewer young men and women with the right to inherit agricultural land under Norwegian allodial law, actually want to become farmers. While 69 per cent were keen to take over the family farm in 1996, that figure had dropped to 51 per cent in 2002. According to the survey, the most important reason for the decline is the lack of money to be made from farming.
  (Aftenposten/Sunday)
• Nearly half of Braathen’s ground staff have applied for a job with SAS. But far from all of them will be offered a job, and many will have to prepare themselves for part-time work and poorer terms and conditions. 850 Braathens employees have applied for a severance package. Thursday was the deadline for Braathen’s 1,300 ground staff to have either applied for a job in SAS, applied for a severance package ranging from eight to 15 months’ salary, or be transferred to a job bank.
  (Aftenposten/Saturday)
• Lay assessors slow down the speed at which court cases can be heard. The Ministry of Justice is currently considering a proposal from District Court Judge Arild Kjerschow in Oslo for legislation to get rid of lay assessors in cases involving fines. Efficiency and cost-cutting are the key words.
  (Dagbladet/Saturday)
• The days are gone when house-owners could put their property on the market in the morning and sign the sales contract that same evening. The housing market has slowed to a snail’s pace. According to estate agents prices are flattening out, though there is certainly no slump in prices. A large number of flats and houses are still being sold for more than the valuation price in the country’s major cities.
  (Aftenposten/Saturday)
• Some shops on the Norwegian side of the border with Sweden have reported a substantial rise in turnover so far this year, despite the increase in Norwegian retail spending in Sweden.
  (Nationen/Saturday)

Today’s comment from Dagsavisen

Just days before the UN’s World Summit on Sustainable Development opens in Johannesburg, South Africa, parts of Europe are under water. Although no one knows for certain, there is reason to suspect that the huge amounts of rain which have fallen recently are due to climate changes for which human activity is responsible. But paradoxically, drought and water shortages are a greater environmental threat to the world’s population. Half the world’s population will suffer from water shortages during the next 25 years, according to one of the reports published in the run-up to the summit. And water is needed to cultivate the soil and produce food for a growing population. In Johannesburg 120 of the world’s heads of government will follow up the resolutions for sustainable development adopted at the Rio de Janeiro summit in 1992. Little Norway can play a positive role during the conference. We have the chance to take the initiative within the western bloc. At the same time we have an international status which enables us to build bridges between north and south. Ten years ago in Rio sustainable development was put squarely on the international political agenda, and some important principles were adopted. In Johannesburg the objective is to produce an action plan that is as concrete and binding as possible.

NOREG