Norway – peeping out behind Sweden and focusing on the new

11.04.2017

Norwegians don’t know all the things Finnish companies can do.

Norway is seriously overshadowed by Sweden, if the indicator used is exports by Finnish companies. According to the statistics compiled by Finnish Customs, exports to Norway total about EUR 1.5 billion per year, whereas trade with Finland’s western neighbour, Sweden, is valued at nearly six billion.

Companies’ enthusiasm to head for the Norwegian market has long been modest, even though Finns enjoy a good reputation in their neighbouring country.

- Norwegians often turn their eyes elsewhere, not to Finland in the east. Success on the export market therefore requires local presence. Trade is based on trust. Many companies start exporting to faraway destinations, even though this involves challenges and requires a lot of money and time, says Regional Director /Norway Markus Laakkonen of Finnvera.

- A company planning exports should look closer first. Surveys conducted among companies indicate that interest in neighbouring areas has increased. For instance, Norway has regularly ranked the 3rd or 4th as a destination of interest among Finnish companies, he continues.

The traditional oil, gas and energy sectors have long attracted enterprises to Norway. Demand in seafaring, fishing and building has also increased lately.

Norway is now looking boldly to the future. One example is the country’s strong input into electric vehicles: the Norwegian Government is planning to ban the sale of traditional diesel or petrol-fuelled cars by the year 2025.

Laakkonen says that potential exists in many other sectors as well. Economic growth in Norway dipped last year, but according to forecasts, the gross domestic product will increase by about 1.7 per cent this year.

Wealth also gives Norway leeway to make investments in infrastructure and health services.

- Norway invests heavily in the reform of health services. Finnish healthcare companies would therefore be in great demand in Norway. Know-how and efficiency, in particular, are selling points for Finnish healthcare companies, Laakkonen points out.

The blue economy is rising

Even more interesting than economic growth is the increase in Norway’s population. According to population forecasts, Norway is one of the fastest growing countries in Europe.

- When the population increases, new roads, transport solutions and schools are needed. This creates opportunities for Finnish companies because the natural conditions in Norway are very similar to those in Finland, says Ambassador Erik Lundberg.

He believes that Norwegians are now looking to the sea, in particular.

- Oil and gas supplies won’t last forever, and Norway must constantly seek new renewable energy solutions. Opportunities are seen especially in what is called the blue economy: the marine industry, the fish industry and the energy sector.

The health sector is also reaching out to the sea. As one topic being studied at present in Norway, Lundberg mentions the health effects of seaweed.

In Lundberg’s opinion, Finnish companies have been slow in seeking their way to Norway, because in both countries the other party is known rather poorly.

- Norwegians don’t know what Finns can do, and vice versa. In numerous sectors, however, there are many points of contact and areas that would offer good opportunities for cooperation.

Stiff competition

Lundberg emphasises that the Nordic countries, in general, should have more cooperation. Some innovation cooperation has already been launched between universities.

- For example, Slush has also been noticed in Norway, and interest in the Finnish start-up sector has risen.

Except for the agricultural and food sectors, Norway is part of the EU internal market. Protectionism occurs mainly in those areas.

- Norway is quite an open economy. However, it is good for a company dreaming of the Norwegian market to keep in mind that competition is fierce. One must show up well prepared, and solid trust must first be built with the locals.

FACT: Norway

Gross domestic product: About EUR 486 billion (2015). Finland’s gross domestic product is EUR 207 billion (2015).
Gross domestic product per capita: EUR 93,270 (2015). Finland’s gross domestic product per capita is EUR 37,827 (2015).
Economic growth: 1.6% (2015).
Inflation: 2.3% (2015).
Exports: EUR 105 billion (2015).
Imports: EUR 71 billion (2015). The total value of Finnish exports to Norway in 2015 was about EUR 1.55 billion.
Principal sectors: Industry and services. Norway’s main export products are oil, natural gas, machinery, metals, chemicals and fish.
Currency the Norwegian Krone: The exchange rate is EUR 1 to NOK 9.16.

More information about Finnvera’s export credit guarantees is available here.
Sources: Ministry for Foreign Affairs, Focus Economics, Finnish Customs