The Royal Ministry of Foreign Affairs,
Oslo Press Division

Norway Daily No. 95/00

Date: 19 May 2000

KREDITKASSEN MAY BE SOLD (Aftenposten)

A political majority is building up for selling off the government’s Kreditkassen holdings. Influential elements in the Christian Democratic party are now making an active effort in this direction, which harmonizes with the Liberal viewpoint. The Centre Party will have to go along if the centrist parties are to remain united. If the political centre goes in for privatizing the Kreditkassen, the Government will have no choice but to do the same. The Government could well find itself supporting a bank industry structure in which state involvement is limited to Den norske Bank (DnB), while the Kreditkassen is incorporated into a larger Nordic entity. Finance Minister Karl Eirik Schjøtt-Pedersen has worked harder than anyone else in the Labour Party to avoid this outcome, and would rather see the Kreditkassen merged with the DnB.

GOVERNMENT’S MUNICIPAL FUNDING PACKAGE UNDER FIRE (Aftenposten)

Minister of Local Government and Regional Development Sylvia Brustad will present the municipal finance package for 2001 today. The package gives local governments around NOK 3 billion in overall income growth, as reported by Aftenposten yesterday, but the Norwegian Association of Local Authorities (KS) says NOK 10 billion is necessary in order to enable local governments to balance their budgets. The Government is just letting the problems pile up, says the head of the KS. The municipal finances package has also provoked sharp criticism among Labour’s own MPs.

MPs PRESSED GOVERNMENT TO GIVE MORE TO MUNICIPALITIES (Dagbladet)

After a tough meeting with Labour’s parliamentary group last night, Prime Minister Jens Stoltenberg and Finance Minister Karl Eirik Schjøtt-Pedersen have had to find more money for the municipal sector. The MPs went to the drastic step of demanding changes in the Government’s proposals. The ink on the Municipal Finance Proposition will hardly be dry before Minister of Local Government and Regional Development Sylvia Brustad will be presenting the schedule of municipal revenues and expenditures for 2001 today.

BAD OFFER TO FARMERS COULD GET LABOUR IN HOT WATER (Nationen)

Johan J. Jakobsen demanded the Stoltenberg Government’s adherence to the centrist parties’ farm policy outline in return for their cooperation with the Government. Now he says Labour will be violating its agreement if the government offers farmers a decline in income, in which case the spirit of cooperation will be in danger of disintegrating.

REKLESS BORROWING BY TELENOR (Dagens Næringsliv)

Heavy loans taken up by Telenor to finance its recent investments have reduced its equity base below the 42 per cent capital adequacy requirement instituted by the Storting. Telenor chief Tormod Hermansen has borrowed too much by several billion kroner. Since April, Telenor has invested NOK 9.5 billion buying equity in other companies, and if this is all debt-financed, Telenor’s equity base is down to around 37.5 per cent, with a debt burden of nearly NOK 38 billion. A number of MPs react sharply to Mr. Hermansen’s borrowing activity right before the Storting is to deal with a proposition to partially privatize Telenor.

NORWAY NOT IN UNIFIL YET (Dagsavisen)

According to acting press spokesman Runar Todok of the Ministry of Defence, Norway has yet to decide whether it will contribute to UN forces in southern Lebanon. He denies reports from the Israeli Foreign Ministry that Norway is one of the countries which has indicated its willingness to take part in the UNIFIL force which is to be expanded from 4,500 to around 7,000 troops as Israel withdraws from southern Lebanon.

THUMBS DOWN FOR PRIVATE RELIGIOUS SCHOOL (Aftenposten)

The Storting is not inclined to compel Minister of Education, Research and Church Affairs Trond Giske to approve the Oasen (oasis) Christian grammar school in Songdalen in Vest-Agder. This was one of the last private schools approved by former Minister of Education, Research and Church Affairs Jon Lilletun, four days before the Bondevik Government stepped down. The Songdalen town council, which opposes the establishment of this school, appealed Mr. Lilletun’s decision, and the Ministry, now under Labour management, revoked the approval last Monday. The Progress Party submitted a bill yesterday which would have ordered the Government to uphold Mr. Lilletun’s decision, but it received no backing from the other parties. Odd Einar Dørum (Liberal), explaining why he voted against the bill, said: It is a blatant attempt to infringe on the prerogatives of the sitting Government.

CHINESE ENVIRONMENTAL CHAMPION LAUDED (Aftenposten)

Chinese environmental activist and journalist Sheri Liao, who has been instrumental in raising the environmental awareness of the Chinese people, has been awarded this year’s Sophie Prize. The Sophie Prize is an international environmental prize created by author Jostein Gaarder and his wife Siri Dannevig, who in 1997 donated NOK 10 million to a foundation which awards $100,000 every year to a person who has shown unusual creativity in pointing out alternatives to current developments or has initiated such alternatives themselves.

WORTH NOTING

• TV2 and the Norwegian Broadcasting Corporation (NRK) are both struggling with internal conflicts and a crisis in leadership. Two days after TV2 vice president Finn H. Andreassen departed, programme and planning chief Trygve Rønningen, the only remaining senior manager with a TV background, left as well. Since Kåre Valebrokk became TV2's managing director, five of its most important people have left. The problems seem to include the station’s programming profile as well as its style of leadership. (Aftenposten)
• The wage settlement in the retail trade has encouraged Norwegian Union of Municipal Employees president Jan Davidsen. Mr. Davidsen is now aiming for a wage growth framework of five per cent, which would add another NOK 1.5 to 2 billion to municipal expenditures. (Dagens Næringsliv)
• Unemployment is on the decline in Sweden, and Swedes believe it will soon be down to Norwegian levels. If this happens, it will be difficult to get Swedes to fill the gaps in the Norwegian labour market. 30,000 Swedish workers keep Norwegian hospitals, construction sites, hotels and restaurants running. (Dagsavisen)
• The NRK newsroom reports that the oil companies’ staff reductions have cost Norwegian taxpayers NOK 2 billion. The oil companies have reduced their workforces by 4,200 in a year an a half, and employees have received an average of NOK 600,000 to quit voluntarily. Lars Anders Myhre, president of the Norwegian Oil and Petrochemical Workers' Union (NOPEF), feels this money could have been spent differently. (NTB)
• A new contract will bring Telenor nearly NOK 100 million per year. Part of the international telephone traffic from Moscow and St. Petersburg, as well as calls from the Murmansk region, will be routed through Telenor’s exchange in Oslo. (Dagens Næringsliv)

TODAY’S COMMENT from Dagens Næringsliv

What should the Norwegian Farmers' Union fight for this year? asks the union in the preface to a debate book on this year’s agricultural settlement. The farmers are leaving nothing to chance. It is an effective and professional lobby organization which will be receiving an offer today from the government’s chief negotiator, Secretary General Per Harald Grue of the Ministry of Agriculture. According to Aftenposten, Mr. Grue has little to offer this time. He proposes to cut farm supports by several hundred million where the farmers have asked for NOK 900 million more. A settlement must be achieved by next Saturday, submitted to the Storting on 2 June and adopted on 16 June, right before the Storting adjourns for the summer. The agricultural negotiations are an anachronism. Today’s farmer is basically a tenant farmer working for the state. What makes it hard to understand is that they seem to prefer it that way. Deplorable as it is, there is little likelihood that this year’s settlement will be the last. The only comfort is that farms are getting bigger and farmers fewer, and this can only mean that the need for farm support will decrease. Or does the need for subsidies increase in proportion to the size of the farm? That does seem to be the case sometimes. But the industry does help its own, of course, though the recent attempt to destroy 2,000 tons of meat illustrates one of the more absurd elements of this policy. This sort of thing reveals more than any number of speeches and editorials. (Dagens Næringsliv)