• Many of you present here today represent companies that want to expand their overseas commercial and technological interests. I applaud that effort and would like to assure you that the Norwegian government will do everything we can to assist you.

• Today I would like to briefly discuss the potential for increased co-operation between Norway and Canada in the field of trade and industry, with a special focus on research and development.

Trade figures
(Sheet: Export, import and trade 97-01)

• The backdrop is one of Canada as one of Norway’s most important trading partners outside of the European Union. Our trade has however been like a yo-yo the past few years. Last year our trade amounted to around 30 billion Norwegian kroner – representing about 4 percent of Norway’s total foreign trade. Canada was the seventh most important export country to Norway in 2001, and the twelfth most important import country. Norway has a trade surplus with Canada.

(Sheet: One-sided Trade)

• Our trade is however somewhat one-sided. 95 percent of our exports to Canada consist of petroleum and petroleum products. 60 percent of our imports from Canada consist of nickel-based metals imports. In the marine sector we are both competitors and important customers. Seafood is the third most important Norwegian export product to Canada. The fact that both the import and export show a concentration on a couple of raw materials tells us that there is a potential for a broadening of the scope of the trade.

Foreign Direct Investment

(Sheet: Foreign Direct Investments)

• The stock of foreign direct investment in Norway amounted to NOK 269 Billion in 2000. Investors from EU countries and the US dominated with a share of nearly 90 percent.
• Norway is a source of foreign direct investment for Canada. Norwegian investment stock in Canada totalled NOK 7,9 Billion in 2000, up from NOK 4,7 Billion in 1999.
• Norway and Canada are co-operating very well in the petroleum sector. There are several successful partnerships in Atlantic Canada, bringing about local offshore development. One example is the joint venture between Kiewit and Aker Kværner for the production of the topside structure of the White Rose platform outside Newfoundland and Labrador.
• The largest Norwegian investment project is Norsk Hydro’s magnesium plant in Quebec. Significant Norwegian capital has also been invested in Canada’s aquaculture, transportation and pulp and paper industries.
• The Norwegian investment activities in Canada may to a large degree be explained by Canada’s attractiveness as a country for setting up business. A study by KPMG of 27 cost factors in 115 cities in G-7 countries ranks Canadian cities higher than many of their international counterparts, taking into account factors such as labour costs, taxes and transportation, energy and facility costs.
• Norway was not a part of the KPMG-study. A study conducted by Deloitte & Touche recently does however (somewhat surprisingly?) state that six of the ten best regions for business activities in Scandinavia are situated in Norway, with the Oslo region as the very best. While Norway has 94 companies displaying growth per 1,000 people, the number in Sweden is 81 and in Denmark 39.

Similarities as a foundation for increased co-operation and trade

(Sheet: Good foundation for co-operation?)

• Many have pointed to the similarities between our two countries, and see them as a good foundation for increased co-operation, investment and trade. Norway and Canada are both countries in the Northern Hemisphere with a long coastline and sparsely populated areas far in the North. Both countries have a strong interest in protecting the environment and in defending quality of life and high standards.

• We also share many views on political, economical and trade policy issues. This is to no small degree evident from the work taking place in NATO and the United Nations. A major challenge shared by our two countries is to deal in a constructive and beneficial way with powerful neighbours, this of course being the US in the case of Canada and the European Union in the case of Norway.

State visit to Canada

(Sheet: State Visit to Canada in May 2002)

• During the state visit by the King and Queen of Norway to Canada this spring, several areas with a potential for increased co-operation and trade were explored. One area was Norwegian competence and products within light metals and the potential for increased interaction with the car-industry in North America. Other focus-areas during the visit were oil and gas, aquaculture, energy deregulation and tourism.
• The seminars held in connection with the state visit were successful, and could lead to increased co-operation between Canadian and Norwegian economic and scientific actors. We do however believe that the economic and industrial ties between our two nations could be strengthened even further. The conclusion of a Free Trade Agreement between the EFTA-states and Canada would clearly facilitate this.

Free Trade Agreement

(Sheet: Free Trade Agreement?)

• The EFTA-states and Canada started negotiations on a Free Trade Agreement in 1998, with the ambition of reaching an agreement by 2000. There has however not been any real movement in the negotiations on a Free Trade Agreement since 2000.
• One prominent issue since the start of the negotiations has been subsidies to the shipbuilding industry in the EFTA-states and tariffs on ships in Canada. This seems to be a particularly sensitive issue to the provinces of Atlantic Canada. Subsidies to the Norwegian shipbuilding industry were however abolished more than one and a half years ago.
• I hope to see a solution soon to the remaining concerns on the Canadian side, so that an agreement may be concluded, to the satisfaction of many in the business community and the benefit of our two economies. The end result could be increased and more diversified trade and increased exchange of knowledge and technology.

Innovation and high technology industry

(Sheet: Growing a Dynamic Economy)

• Canada and Norway are both blessed with bountiful natural resources. Both countries do however also share a goal of facilitating the transition towards a knowledge-based economy, and aim at boosting the level of knowledge and innovation in production and manufacturing.

• In Canada, traditional research and industrial policy has been supplemented by an ambitious innovation strategy. The Government of Norway has stated that Norway shall be in the lead internationally in new technology, competence and knowledge. The role of innovation and entrepreneurs as vehicles for economic growth should also be strengthened.

(Sheet: High Penetration of New Technology)

• The foundation seems good. Few countries spend as much on knowledge and education as Norway and Canada. The number of scientists and engineers per million people is among the highest in the world. Canada and Norway also rank high on penetration of new technology, as demonstrated by the percentage of the population who have personally used the Internet (Norway: 58, Canada: 60, country average: 34%) and the percentage of the population who have access to a mobile phone (Norway: 77%, Canada: 51%). (2002- and 2001-figures respectively).

• Norway however clearly has a potential for improvement in putting high levels of knowledge and technology to commercial use. We currently rank as number twelve among industrialised countries in the number of patents granted to residents, but actually ranks higher than Canada.

(Sheet: High-technology exports)

• High-technology exports as % of manufactured exports are relatively low in both our countries. In Norway we see this as a challenge, not only because of the possible returns associated with bringing new and innovative products to international markets, but because feedback from international markets is a driver for further innovation.

• Two exceptions to this more general picture should be noted. Canada has made biotechnology a priority area, and ranks high among industrialised countries in number of patents in the biotechnology sector. Given the fact that both our countries see biotechnology as a possible major engine for economic growth, this seems to be an area with a potential for increased co-operation.
• Canada is one of the world’s largest exporters of aerospace products and services, and holds a leading position in the design and manufacture of aviation products and services and technical services. Norway also has advanced high-technology firms in the field of space applications, and puts a lot of effort into developing this area further. Another area for increased co-operation?

(Sheet: We aim at increasing innovation in our firms….)

• Returning to the more general picture, Canada and Norway seem to share a challenge in transforming our assets into a higher degree of innovation in all aspects of business practice, including production, business processes, management, financing and marketing. In a few years we hope to see a an increased share of private sector sales attributable to innovation in Norway.

Research and development

(Sheet: …it takes an increased effort in R&D)

• R esearch and development is an important input to innovation. R&D expenditures constitute about 1,7 percent of GNP both in Canada and Norway, and are thus below the OECD average at 2,2 percent. Norway aims at reaching the OECD-level by 2005. It is a major challenge to increase the industry-financed research and development in Norway, and to increase co-operation between industry and academia.

(Sheet: Norwegian Research Priorities and Targets)

• We have four thematic priority areas at a national level: Medicine and health, biotechnology, marine resources and research in the intersection between energy and environment. We also have three priority areas in strategic, trade and industry related research. These are information and communication technology, biotechnology and materials technology.

• We seek to facilitate basic long-term research, and promote research that is interdisciplinary and promotes the industry of tomorrow. Innovation in materials technology is for instance a prerequisite for progress in areas such as ICT, transport, offshore, space, medical technology, environmental technology and renewable energy.

Bilateral co-operation

• The Norwegian Government puts great emphasis on improving the framework conditions for business operations in general, and for innovation in particular. International and bilateral co-operation is an integral part of our efforts. In a global economy, all nations need to exchange ideas and experience and develop partnerships based on comparative advantages.
• I believe Canada represents an exciting market for Norway’s industrial research and development collaboration. I have already pointed to several areas that should be explored further both at a business, regional and strategic level.

• Allow me to mention that the Norwegian Government has introduced a new R&D tax deduction scheme, allowing Norwegian businesses to receive tax credits when purchasing research and development services, also from foreign companies and institutions.

The workshop at Gardermoen

(Sheet: Work-shop: Research and development and co-operation)

• Today, the focus is on the area of Romerike and the possibilities for increased co-operation between Canadian and Norwegian businesses and research and development actors here. The point of departure is a good one. Located in this county is the Kjeller area, with a history of 50 years as a research park. Kjeller is clearly a centre of gravity in the field of technology in Norway.
• The meeting today takes place at Gardermoen Airport, which I am glad to say has achieved international recognition for its modern architecture and design. A strong technical expertise in the field of aviation and avionics is however also located here. Romerike clearly has a challenge in taking advantage of the possibilities for commercial spin-offs from the airport activities.

• Moving into the skies, I would also like to mention that the Norwegian Space Center has signed a tentative agreement related to the Canadian satellite Radarsat. This also opens up to exciting possibilities for co-operation in other space-related areas.

Conclusion

• The workshop here at Gardermoen today represents a possibility to highlight the opportunities offered by the global, knowledge-based economy. I am confident that the Norwegian firms and research institutions present here today are well prepared to present their competence, skills and commercial ambitions, and look forward to co-operating with their Canadian counterparts.

• I wish you all the best in your efforts to identify common interests, explore new ideas, build networks and establish personal contacts. Hopefully this will lead to new relations being made and old ones reinforced - to the benefit of everyone concerned.