Historical archive

Norway Daily No. 158/02

Historical archive

Published under: Bondevik's 2nd Government

Publisher: Ministry of Foreign Affairs

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

Norway Daily No. 158/02

Date: 22 August 2002

Kurd resident in Norway suspected of al-Quaida terrorist links (nrk.no)


A Kurd who has been granted the right to stay in Norway, where his family now resides, is suspected of responsibility for the production of chemical weapons for the al-Quaida terror network. Mulla Krekar, who is being hunted by all the major western intelligence organizations, has been granted residency in Norway. Krekar is currently somewhere in northern Iraq where he leads the Ansar-al-Islam group which, according to intelligence reports, cooperates with al-Quaida. The Immigration Directorate (UDI) intends to discuss the matter with the National Police Security Service and the Foreign Ministry. Krekar now risks losing his Norwegian residence permit. NRK’s Brennpunkt documentary series has recorded an interview with Mulla Krekar, which is scheduled for transmission this coming Tuesday.

Gjedrem refuses to rescue industry (Aftenposten)


With his gaze fixed firmly on Kjell Bjørndalen, leader of the Norwegian United Federation of Trade Unions, Svein Gjedrem, Governor of the Norwegian Central Bank, departed from his prepared text yesterday and said: "I think you underestimate the uniquely Norwegian level of wage rises and the forces which lie behind it." These words set the tone for Mr Gjedrem’s speech, as he bearded the lion’s den and addressed the union’s industrial conference. Mr Gjedrem refused to take responsibility for the high level of interest rates and the strong Norwegian krone, which Norwegian industry is struggling to cope with. He lays the blame on employers and unions alike, because they agreed a level of wage rises which was too high, and on the Norwegian people, who are keen to spend more of the country’s oil revenues.

Foss to tighten next budget (Dagens Næringsliv)


Finance Minister Per-Kristian Foss has been given figures showing that he can spend more of the country’s oil revenues without decimating Norwegian industry. The Finance Minister and the Government have been under fierce attack by both the Labour Party and the Socialist Left Party for spending too much oil money. Mr Foss has now warned that the 2003 budget, which will be presented in October, will be ‘tight’. "The most important contribution we can make to help those companies facing international competition is a less expansive budget. It can help to cut interest rates, which in turn will reduce the exchange rate. We are taking the situation facing industry very seriously. It is one of the most important arguments in the Government’s internal budget discussions," said Mr Foss, who was attending a major industrial conference in Oslo yesterday.

Bergesen calls for emergency package for export industry (Verdens Gang)


Finn Bergesen Jr, chief executive of the Confederation of Norwegian Business and Industry (NHO), has sounded the alarm on behalf of the country’s export industry. Interest rates, exchange rates and wage rises have put 50,000 jobs at risk. The NHO has now dusted off the 1990s solidarity agreement in an effort to get the economy back on track. "We did it in 1992 when Norway really was in dire straits. Now we have to act before the crisis becomes as deep as it was then. I really believe we can bring the cooperation between the authorities, the employers and the unions back to life again," said Mr Bergesen.

Norway facing rapid transfer of industrial production abroad, politicians warned (Dagens Næringsliv)


Industrialist and banker Terje Vareberg, is predicting a rapid and wholescale transfer of production out of the country’s outlying districts. Small and medium sized companies are packing up and moving abroad. Yesterday Jordan decided to move its production to the UK. Announcements of such relocations are increasingly common. Mr Vareberg, who is chief executive of Sparebank 1 SR-Bank, says that responsibility for this does not lie with Svein Gjedrem, Governor of the Norwegian Central Bank, nor with the trade unions. "Mr Gjedrem has his mandate, and I do not wonder at workers asking for higher wages when demand for labour gives them the chance. The Storting, on the other hand, has a very great responsibility for distributing resources in this country. MPs must shoulder that responsibility. Politicians – and I mean politicians from all parties – must be aware that the consequences their actions will become apparent very quickly," said Mr Vareberg.

Giske supporters use threats to get their man elected (Verdens Gang)


Trond Giske’s supporters are now openly threatening that he will be less loyal to the Labour Party if he is not elected deputy leader. MP Gunn Karin Gjul says bluntly: "After the debate we have just had, it would be more difficult to have Trond outside the leadership than inside. His ties of loyalty to the party will not be as strong as they would be if he were a member of the Labour leadership." The use of unconcealed threats to get Mr Giske elected as deputy leader at the annual conference this autumn represents a dramatic increase in the intensity of the debate.

Storebrand leaders pay up (Dagbladet)


A number of key figures in and around Storebrand have now dug deep in their pockets to buy Storebrand shares. The aim is probably to convince the world that the company is sound. Board members, senior executives and other leading employees in the troubled financial services group have obviously had the same idea at the same time – now is the time to buy Storebrand shares. It is almost possible to believe that they have been talking together.

Worth Noting

  • Former Labour minister Grete Knudsen has been branded disloyal in a resolution adopted by the executive committee of her own party branch in Bergen on Wednesday evening. The high-profile Labour politician was reprimanded by her fellow party workers after revelations that she worked as a consultant for the youthful businessman Carl Fredrik Seim before he acquired the Mjellem & Karlsen shipyard.
    (NTB)
  • Mjellem & Karlsen’s chairman, Robert Hermansen, yesterday assured senior managers from the Spanish company, Izar, that the Norwegian shipyard will complete its part of the frigates being built for the Norwegian navy. However, Izar’s management wanted to see the industrial plans for the construction of the frigates.
    (Aftenposten)
  • Development Minister Hilde Frafjord Johnson does not want to link negotiations on measures to combat poverty with negotiations on market access at the World Summit on Sustainable Development in Johannesburg. She believes that developing countries’ demands for better market access belong under the WTO trade negotiations rather than being a topic for debate at the UN summit on environmental and development issues.
    (Dagens Næringsliv)
  • Within a few years Ansgar School, the Norwegian Teacher Academy for Studies in Religion and Education, and Fjellhaug Mission Seminary intend to offer students a five-year master’s degree in theology. There are currently three colleges which provide courses qualifying individuals for the clergy. These are the Free Faculty of Theology, the University of Oslo’s Faculty of Theology and the School of Mission.
    (Vårt Land)
  • In a recent opinion poll from MMI, the agricultural sector takes a beating. Fewer and fewer consumers are buying the farmers’ claims that Norwegian food is of high quality. Consumer confidence has plummeted over the past three years. Only one in two Norwegians agrees that Norwegian agricultural produce is first class.
    (Aftenposten)
  • During the first six months of the year 3,000 more real estate sales were officially registered than in the corresponding period last year. The sales value of the property rose by NOK 10.2 billion, according to figures from Statistics Norway.
    (NTB)

Today’s comment from


Shipyards are closing, companies are transferring production abroad and share prices are holding steady at rock bottom. Employees are losing their jobs and there is a groundswell of pessimism in business circles. The hunt for those responsible is underway, and one of the principle targets is Svein Gjedrem, Governor of the Norwegian Central Bank. He is keeping his eye on one key target – inflation is to be kept down. To achieve that he has set interest rates at a high level. This makes it very lucrative for foreigners to place their savings in Norwegian kroner, which in turn pushes up the exchange rate. Business is always looking for a good reason to cut costs. The negative effect on exports brought about by a strong currency is something everyone understands. It is an opportunity waiting to be exploited without anyone making too much fuss. For society as a whole it seems as though all the bad news is coming at once. For the sitting government this is bad news indeed. Prime Minister Kjell Magne Bondevik is struggling with his image over regional development issues, and is being forced into difficult explanations about balancing the budget and keeping within the agreed limit for oil revenue spending. The country’s most popular politician, Carl I. Hagen, contributes in his is inimitable way by ridiculing such "responsible" explanations. We have enough money, so let’s spend it, is his simple message. The people are left confused. There they are with lots of money in their pockets after this spring’s generous pay rises and extra holiday pay. But they have become profoundly anxious about what the future will bring. This could lead to a cut in consumption. This kind of cooling down of the economy need not be a bad thing, and Mr Gjedrem could finally come out and announce the cut in interest rates everyone has been clamouring for. Could it be that the Governor of the Norwegian Central Bank ends up being the hero of the day later on this autumn?