Canada Corona crisis: Norway wants to withdraw a record amount from the oil fund
Bund wants to borrow record sums on financial markets
© Kay Nietfeld / dpa Federal Finance Minister Olaf Scholz in the Bundestag. The federal government wants to borrow a record amount on the financial markets to deal with the consequences of the Corona crisis. The federal government wants to borrow a record amount on the financial markets to deal with the consequences of the Corona crisis. In the months of October to December alone, federal securities with a volume of 50.5 billion euros are to be placed, announced the finance agency responsible f
Norway must also help its battered economy with aid packages out of the crisis. Around 40 billion euros from the state fund are now to fill the budget holes.
The economicdo not stop at , one of the richest countries in Europe. In order to be able to finance its budget for the coming year with various aid programs for the troubled economy, the bourgeois Norwegian minority government plans to withdraw a record high amount
As Finance Minister Jan Tore Sanner said on Wednesday, the budget deficit of 3.9 percent will be offset in the current year with 433 billion crowns (39.7 billion euros) from the state fund. This is the highest amount that a Norwegian government has ever withdrawn from the oil fund.
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"The corona pandemic caused the worst setback in the Norwegian economy since the Second World War", Sanner explained the step. Should the government get away with its move in parliament, it would take out more than the three percent of the fund's administrative capital approved by parliament to plug the budget holes.
"We have to do everything possible to ensure that Norway comes out of this crisis as well as possible and that the next generation doesn't have to pay the bill," Sanner emphasized. The crisis is so extensive that a large withdrawal from the fund is justified.
In the previous summer, the government had even expected a withdrawal of 4.2 percent of the fund, emphasized the finance minister. In this respect, the amount now proposed is a little lower, he said. In addition, plans are being made to withdraw just 313 billion crowns from the oil fund in the coming year and thus to comply with the rules again.
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It is not yet clear whether the minority government will get through with its plan in parliament. Because in January of this year, the right-wing populist Progress Party left the government, which is now dependent on votes from its former coalition partner or the red-green opposition. The ruling parties have only 61 of the 169 seats in the Norwegian Parliament.
Tax cuts should stimulate the economy
The government, which consists of the conservatives of Prime Minister Erna Solberg, the social liberal party Venstre and the Christian Democratic Kristelig Folkeparti, expects a decline in gross domestic product of 3.1 percent for the current year, excluding oil and gas revenues . In the coming year it should increase again by 4.4 percent. In order to stimulate the economy, the government is planning extensive tax cuts and extra funds for infrastructure projects.
In contrast to many other countries, Norway can. The oil fund was established in 1996 in order to be able to finance the welfare state even after the oil and gas wells dried up. State income from the country's oil business flows into the fund. The oil fund does not only serve social security, but is also supposed to keep the state budget in balance.
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It's a special day for Haakon of Norway (47). For the first time, but for an important occasion, the Crown Prince takes over the scepter and is installed as regent. The ceremonial opening of Parliament took place on Friday (October 2nd). It is the 165th year of the session and a traditional ceremony is always planned. And we can see that the 47-year-old is doing well in his role as regent.
The fund currently manages around 10,500 billion crowns, making it one of the largest sovereign wealth funds in the world. At the end of the second quarter, the fund had invested 69.6 percent of its capital in stocks. 27.6 percent came from bonds and 2.8 percent from real estate. The fund has currently invested most in stocks of the US software giant Microsoft.
In contrast, the fund managers achieved the best return with their shares in Amazon. But Apple also contributed to a plus in the second quarter of this year. Overall, the return at the large US technology companies in the second quarter was 14.2 percent. On the other hand, things went worst with the stake in Royal Dutch Shell and the major banks HSBC Holdings and JP Morgan Chase.
The investment strategy is based on guidelines from the Norwegian government. Two years ago the fund received permission to increase its investments in stocks by ten percentage points to 70 percent. 25 percent may be invested in government bonds, five percent in real estate.
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The newly decided restrictions on overnight stays by travelers from domestic risk areas are met with mixed echo from politicians and city representatives. © Provided by Finanz.net Spencer Platt / Getty Images "We have known since the summer holidays at the latest that travel in particular leads to chains of infection no longer being manageable," said Schleswig-Holstein's Prime Minister Daniel Günther (CDU) on Wednesday evening in the ARD "Tagesthemen".