Strategy

Strategy for Export and Internationalisation

The Government’s ambition is that Norway shall strengthen its position as a trading nation through the following goals:

Securing market access to new and existing export markets.

Attracting foreign investments to Norway.

Positioning Norway as a leading research and innovation hub in fields where we have specialist expertise, in order to further develop our academic communities and attract competence to Norway.

Increasing export from existing export industries as well as facilitating new export industries.

Streamlining and targeting the established policy instruments.

Strategy for Export and Internationalisation

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Opening of the new container port Oslo &The Box. Phto: Roger Fosaas/Port of Oslo

Contents1 Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

3 Opportunities and Challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 193.1 Trade policy in a time of change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

3.1.1 EEA and the European Single Market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 203.1.2 Brexit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 213.1.3 Lack of regulation for export credit programs from emerging countries. . . . . . . . . . . 22

3.2 An attractive Norway . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 223.2.1 Promoting Norway as an attractive country for investments and leading academic environments and talents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 223.2.2 Reputation and branding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

3.3 Competitiveness and innovation capability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 273.3.1 Research, education, and technology development . . . . . . . . . . . . . . . . . . . . . . . . . . . . 273.3.2 Standards help reduce trade barriers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 293.3.3 Securing, handling and utilisation of intangible assets and intellectual property rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 293.3.4 Green competitiveness. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

3.4 The public support system for export and internationalisaton. . . . . . . . . . . . . . . . . . . . . . . . 33

4 Trade Policy and Framework Conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 394.1. A multilateral trade policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 394.2 Conclude free trade agreements with priority countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 394.3 A well-functioning European Single Market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 414.4 Trade policy collaboration with the EU and Great Britain after Brexit . . . . . . . . . . . . . . . . . . 414.5 Sign bilateral investment agreements with important markets . . . . . . . . . . . . . . . . . . . . . . . 424.6 Negotiate international agreements for officially supported export credits . . . . . . . . . . . . . 424.7 Contribute to long-term and stable framework conditions for the ocean industries . . . . . 43

4.7.1 Maintain long-term and stable framework conditions for the petroleum industry.. . 43 4.7.2 Work for long-term and stable framework conditions for the maritime industry . . . 44 4.7.3 Ensure long-term and stable framework conditions for the seafood industry . . . . . . 45

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Photo: Thinkstock

4.8 Increased export of Norwegian agricultural products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 454.9 Secure a regulatory framework for export of Norwegian military equipment . . . . . . . . . . . 464.10 A profitable and sustainable tourism industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 464.11 A modern and efficient transport system . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 474.12 Facilitating direct flight routes to Norwegian airports. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

An Attractive Norway and Businesses Succeeding in International Markets . . . . . . . 484.13 A competitive official export credit program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 484.14 Establish a global growth programme in Innovation Norway . . . . . . . . . . . . . . . . . . . . . . . . . 494.15 Strengthen Invest in Norway. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 504.16 Strengthen the development of the cluster policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 514.17 Marketing of Norwegian green solutions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 514.18 Collaboration and coordination between government, regional and municipal stakeholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 524.19 Export of research services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 524.20 Strengthen the knowledge base on Norway’s role in global value chains for production and trade. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 524.21 Continue the focus on research for increased competitiveness and new export markets 534.22 Strengthen the knowledge triangle . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 544.23 Increased industry and innovation collaboration in the Nordic region . . . . . . . . . . . . . . . . . 554.24 Promoting the ocean industries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 564.25 Maintain the mandatory fee for export of seafood. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 564.26 Examine the possibilities for growth and increased export in the renewables sector . . . . 564.27 Preparing information material on the Norwegian energy system, industrial development, and host attractiveness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 574.28 Initiatives for increased export of creative industries. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 584.29 Making the business community’s role in the attainment of the UN sustainable development goals more visible. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 604.30 Facilitating partnership with the business community in international development. . . . . 614.31 The EEA grants. Aid for exploring markets in Central Europe and the Baltics. . . . . . . . . . . . 624.32 Team Norway . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 624.33 Economic diplomacy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63

4

Preface

Top: Photo: Marine HarvestBottom: Photo: Per Eide/Norwegian Seafood Council

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Preface

Norway has a long history as a trading nation. Already during the Viking era, dried fish was exported from Norway. Fish and lumber exports gave the country a boost during the 1800s, and the oil adventure resulted in increased welfare. Global trends, innovation and technological advances have made the world smaller. Export and import follow new trade patterns, and the development of global value chains requires new knowledge in order to understand the markets. Trade based on international agreements and frame-works is important to Norway. The EEA agreement remains unchanged, and will continue to form the basis for close and strong European collaboration.

Norway has a small, open economy which benefits greatly from foreign trade. Access to global knowledge production is also increasingly important to any knowledge economy. The domestic market is small compared to many other countries, and foreign trade and investments are therefore vital to the Norwegian business sector. Norway could not have reached the current level of welfare without international trade and investments.

More than 70 per cent of Norwegian export comes from ocean industries. Norway is one of the world’s largest producers of oil and gas, one of the world’s largest and most advanced seafaring nations. We are the world’s second largest exporter of fish and seafood. Norway has developed a world class supply industry. This provides great opportunities for the Norwegian ocean industries in the future. The Government facilitates the growth of ocean related export.

At the same time, we are working to make full use of the export potential in other industries, so that the Norwegian economy will have a broader base. Climate change has led to the green shift. In order to limit global warming in line with the goals of the Paris Agreement, there will be a continuous need to develop new production methods. This creates opportunities for competent and innovative Norwegian businesses.

If Norway is to continue to develop as a trading nation, we need a competitive business sector that produces goods and services that the export markets demand. There are mostly small and medium sized enterprises in Norway. 99 per cent of all businesses have less than 100 employees, and are considered small and medium sized enterprises (SMEs). Larger enterprises often have more capacity for export and internationalisation than smaller enterprises. As such, this strategy has a number of initiatives to help SMEs strengthen their position in a challenging and compe titive international market.

During the past few years, the Government has made major efforts in order to safeguard the competitive power and innovativeness of Norwegian businesses. We are implementing tax cuts to release capital for investments leading to growth, and we are investing heavily in transportation and technological infra-structure. These are important factors to increase export and attract foreign investments to Norway. We have also simplified, digitalized and reduced red tape in order to make it easier to start and run busi-nesses. The World Bank ranks Norway as the world’s 6th best country to do business in, moving up from 8th position last year.1)

This year, an additional three billion kroner (NOK) is allocated to industrial research and innovation compared to 2013, including the value of deductions through the Skattefunn scheme. The Government also contributes to a stronger green competitiveness for our business sector through ambitious climate and environ-mental policies nationally and internationally, as well as through its focus on research and innovation. The Government’s efforts yield results, and contribute to better frame work conditions for Norwegian businesses.

1 The World Bank ”Doing Business” 2017

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faced by Norwegian businesses with regard to export and internationalisation. Finally, it identifies measures that will help reach the above-mentioned goals.

The main goal of our economic policy is to enable the greatest total value creation possible in the Norwegian economy, within a framework of sustainability. The business sector creates jobs and assets that form the basis of our common welfare. Norway is a small country with natural limitations as to how broad the basis of our business community can be. We can make better use of our resources by buying and selling in a market larger than Norway. This allows for increased production as well as making better use of the econo-mies of scale in the form of larger production. It also allows for better use of comparative advantages. Open trade also contributes to stronger competition and better access to capital.

In order for the policies to have the best possible effect, Norwegian companies need access to inter­national markets to sell their goods and services, as well as to invest. We also need to enable Norwegian businesses to import input factors for domestic production, as well as goods and services for sale in Norway.

Against a backdrop of trade policy upheavals, rising protectionist trends, increased competition in our export markets as well as changes in the composition of Norwegian export, the Government hereby presents a strategy for export and internationali sation. In this strategy we describe how Norwegian authorities will work to facilitate internationalisation and increase trade and investments to and from Norway.

The purpose of the strategy is to identify priorities to ensure good and competitive framework conditions for Norwegian businesses, so that they are well equipped

to face readjustment challenges and tough interna-tional competition. The strategy shall also assist the various publicly supported stakeholders working to promote Norwegian businesses abroad.

The strategy follows on to white paper no. 27 (2016–2017) A Greener, Smarter and More Innovative Industry. In addition, a number of sector specific white papers and strategies have been presented, addressing challenges characterizing the various industries.2) This strategy is aimed at looking at these efforts in a more global perspective.

The Government’s ambition is that Norway shall strengthen its position as a trading nation through the following goals:

2 For example, the Ocean Strategy, the Bioeconomy Strategy, the white paper on energy, the white paper on trade and globalisation, the Action Plan for the Travel and Tourism Industry, Norway’s Arctic Strategy, the white paper on seafood, etc.

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• Securing market access to our existing export markets and new export markets.

• Attracting foreign investments to Norway.

• Positioning Norway as a leading research and innovation hub in areas where we have specialist expertise, in order to further develop our academic communities and attract competence to Norway.

• Increasing export from existing export industries as well as facilitating new export industries.

• Streamlining and targeting the established policy instruments.

The strategy begins by giving an initial description of the status of Norwegian foreign trade. Then the strategy highlights the opportunities and challenges

faced by Norwegian businesses with regard to export and internationalisation. Finally, it identifies measures that will help reach the above-mentioned goals.

The main goal of our economic policy is to enable the greatest total value creation possible in the Norwegian economy, within a framework of sustainability. The business sector creates jobs and assets that form the basis of our common welfare. Norway is a small country with natural limitations as to how broad the basis of our business community can be. We can make better use of our resources by buying and selling in a market larger than Norway. This allows for increased production as well as making better use of the econo-mies of scale in the form of larger production. It also allows for better use of comparative advantages. Open trade also contributes to stronger competition and better access to capital.

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Introduction

Top: Kygo. Photo: Olav Stubberud/SonymusicBottom: Barcode, Oslo. Photo: Thinkstock

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Introduction

An open trade policy with relatively few barriers for import and foreign establishments has served Norway well. Highly productive and profitable sectors get the chance to grow, while less productive activities are dismantled. Households and businesses gain access to a larger and cheaper selection of goods and services. Overall, trade contributes to increased total value creation, and thus to increased welfare.

Trade and investments make knowledge and technol-ogy flow more freely, and they strengthen learning and innovation. Countries that are open to impulses and interaction with others, become technologically technologically more advanced than less open econo-mies. Technological development and digitization have spurred globalisation, while globalisation encourages and spreads technological development. For example, lower transaction costs due to technological develop-ment and political and institutional changes, have brought most countries closer together.

For research intensive and research performing businesses, collaboration with strong academic com-munities in other countries is a means to strengthen their own competence, competitiveness and market access. Collaboration in higher education and research can be a gateway for Norwegian businesses into knowledge communities in other countries. In a global labour market, it is of great value that more Norwegians choose to study in countries which represent important markets for the Norwegian business community.

The extensive technological developments we are facing will change the Norwegian business community as we currently know it. New materials are used, processes are changed, automated and digitzed. New value chains and business models are established.

New businesses all over the world are affected by the changes, and technology is spread quickly between countries. Digitisation changes the economy by reduc-ing entry barriers and transaction costs, so that more companies can offer goods and services in the market. On its own, this helps to strengthen compe tition, contributes to lower prices and gives better products. Information on alternative service providers, prices and quality assessments are more readily available to the individual consumer. Combined with efficient forms of payment across borders, this contri butes to increased demand and expansion of existing markets, while new markets are being created.

International markets increasingly requires changes to the regulatory framework and a need to harmonize regulations across borders. Increased digitisation can, for example by using advanced robots and 3D printers, affect where and how production takes place, and how goods and services are developed. Increased use of new technology and digitisation help increase productivity and competitiveness of businesses. At the same time, increased digitization creates new security challenges.

There is great potential for economic growth within digital trade. More and more industries adopt e-com-merce, and we see that more goods and services are made available for sale online. Digitisation entails great opportunities for Norwegian businesses, which will be able to establish themselves more easily in the inter national market and reach foreign customers with their products. With regard to e­commerce in goods, Norwegian businesses are facing considerable competi-tion from foreign companies. However, it is worth noting that e-commerce includes both goods and services, and that the situation in the service sector differs from the other.

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Digital21The Government has started its work on the Digital21 process for increased digitisation of the business community. The purpose is to establish a comprehensive and unifying strategy across industries, where central stakeholders in the business community and knowledge communi-ties endorse common strategic goals and recommended initiatives. The strategy can also contribute to policy priorities in this field. Digital21 shall be based on the fact that the business community itself has incentives to develop and adopt new technology in order to develop its own business activities. The authorities influence businesses’ opportunities to develop and utilize new knowledge. This happens, for instance, through general frame-work conditions such as regulations, taxes and public funds for developing infrastructure, education and skills, research and innovation. The work is to be done in collaboration with the business community, knowledge communi-ties and other central stakeholders and interest groups. On 4 July 2017, Toppindustrisenteret was tasked with being the secretariat for the Digital21 initiative. A final report will be submit-ted by 1 July 2018.

Petroleum and gas­related activites will play a signifi-cant part in the Norwegian economy for decades to come. However, demand from the petroleum industry for goods and services will not contribute to the activity of the mainland economy to the same degree as before. It is therefore important that Norway strength-ens other private businesses, facilitates growth and employment in sectors exposed to competition, and helps develop new industries and export markets. Although The Government Pension Fund Global

provides a lasting currency income as long as we do not spend more than the real return of the fund, it is first and foremost export that must finance the goods and services we import. This requires profitable export industries that contribute to employment and balance in our national accounts.

At the same time, challenges related to climate change require us to readjust towards becoming sustainable low­emission societies, both in Norway as well as internationally. We must think greener, and many of tomorrow’s low-emission solutions must be found in, or in collaboration with, the business community.

Close collaboration between the labour unions and the employer’s organisations (two-party collaboration) and between these organisations and the public authorities (three­party collaboration), has formed the basis for a well-functioning labour market in Norway. The low level of conflict and the stability of the labour market contribute to making the Norwegian labour market attractive and competitive. A broad social dialogue and co-determination from the labour and employer’s organisations form the basis for a common under-standing of economic policy and the challenges in the labour market both locally and nationally, and creates the basis for a common effort for good international participation. Two-party and three-party collaboration contribute significantly to an adaptable and competi-tive business community.

In 2016, goods represented 70 per cent of total Norwegian exports, while services represented 30 per cent. During the past ten years, services have constituted an increasing percentage of total exports. Traditional goods have also constituted a larger percentage in the past 5 years. Nearly all oil and gas produced on the Norwegian continental shelf is exported, and the value represented approximately 47 per cent of Norwegian goods export in 2016. Half

1990 1991

1992 1993

1994 1995

1996 1997

1998 1999

2000 2001

2002 2003

2004 2005

2006 2007

2008 2009

2010 2011

2012 2013

2014 2015

2016

Share of exports 1990–2016

Traditional goods Oil and gas Ships, platforms and aeroplanes Services

0

20

40

60

80

100

Statistics Norway, Annual National Accounts

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of the Norwegian petroleum production is natural gas, which contributes to reduced greenhouse gas emis-sions when replacing coal. In the time leading up to the financial crisis and the drop in oil prices in 2014, oil and gas exports increased to more than 50 per cent of total exports, before the percentage was reduced to 35 per cent. The high oil price combined with high production was an important reason why oil and gas constituted such a dominant part of Norwegian exports. During the past few years, the value of oil and gas export has decreased due to lower oil prices, and the percentage of oil and gas in the export mix is lower. In the years leading up to 2025, it is assumed that the production will remain stable, so that the petroleum industry will maintain its strong position. The petroleum related supply industry is the second largest industry in Norway, with 40 per cent of its business activity in international markets. During this difficult period, the supply industry has proven to be adaptable, and has thus maintained its competitive strenghts.

Traditional export­oriented industries, such as the processing industry, have invested significantly in streamlining production, and they develop and have actively adopted new technology. They alredy export a high share of their production. This part of the industry is well equipped to take advantage of future growth opportunities in the international markets.

The retail and consumer goods industry has a production value of 121 billion NOK, and employs more than 60,000 people in more than 8,000 compa-nies across the country. Exports account for about half of the production value in this industry, and the future prospects is positive. The retail and consumer goods industry includes products such as furniture, fashion, glass, lighting and electronics. In particular, Norwegian companies producing furniture and interior products have internationally recognized brands. The

design and brand­driven finished goods industry can compete with brand, unique design, functionality and quality, environmentally friendly production and longevity. Through increased emphasis on the use of Norwegian raw materials, for instance wood and aluminium, the retail and consumer goods industry can contribute to increased value creation in the commod-ity industry. The Government will consider measures to contribute to a closer link between the design and brand-driven industry and the commodity industry.

Looking at Norwegian exports besides oil and natural gas, the export of services represents 47 per cent, while the export of goods represents 53 per cent. The most important exported goods are metals, engineering products, seafood, chemicals and chemical products. In services, the largest export industries are international maritime traffic as well as business and insurance services.

Norway has several service industries with considera-ble export potential. Knowledge­intensive areas such as ICT and digitisation, health, biotechnology, as well as cultural and creative industries, are among the areas where Norway has knowledge and research communi-ties that are very advanced in their fields, and where there is a great potential for further development and increased value creation. Also, the boundaries between manufacturing and service industries are partially erased. Manufacturing companies are increasingly making products with a considerable service content. The service content of products also seems to be an increasingly important competitive parameter for businesses in advanced economies.

An analysis project in which Statistics Norway has participated, has found that even though 94 per cent of Nordic businesses do not export goods themselves, they may play an important role as suppliers of

Norsk eksport i prosent, fordelt på utvalde næringer

Andre varer 27 %Olje og gass 35 %

Andre tenester 23 %

Sjømat 8 %

Utanriks sjøfart 7 %

Import av varer og tenester til Noreg

Andre varerTenester

Industriprodukt

Kjelde SSB, årleg nasjonalrekneskap

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intermediate goods to export businesses.3) This also means that these businesses must be competitive in order for the exporting businesses to be internationally competitive. Especially small and medium-sized enterprises are suppliers to businesses exporting goods and services. Thus, many Norwegian businesses are involved in Norwegian export beyond those that produce the goods and services being exported.

In addition to strengthening the competitiveness and innovativeness of the industries that currently have the largest export revenue, the Government will facilitate increased export revenue from other industries, in order to secure our future welfare.

Import of goods and services are either used for consumption or investments in Norway, by consumers, the business community or the public sector. Or, it can be for further processing for export or for use in Norway. We import a wide range of goods and services. 55 per cent of the import is industrial products, and the largest product groups are vehicles and other means of transport, industrial machinery, electrical machinery and appliances, as well as various finished goods. 38 per cent of all import is services.

3 Statistics Denmark, Nordic Countries in Global Value Chains (2017) http://www.dst.dk/Site/Dst/Udgivelser/GetPubFile.aspx-?id=28140&sid=nordglobchains

The ocean is vital to Norwegian exportNorway is one of the world’s leading maritime nations. Our coastline is one of the longest in the world, and we control ocean areas more than six times larger than mainland Norway. Norway is one of the world’s largest exporters of oil and gas, we are one of the world’s largest and most advanced seafaring nations. We are the world’s second largest exporter of seafood. In addition, we have a world class supply industry including the supply industry for aquaculture and fisheries. Petroleum, maritime and marine industries collectively represent about 70 per cent of Norway’s total export income. The Norwegian ocean industries are highly export oriented, and operate in a global market where there is strong competition for market shares and assignments.

For example, Norconsult has become the project manager of a Canadian project to replace coal as an energy source with natural gas. Norway is one of the leading countries when it comes to handling and transporting natural liquid gas (LNG), as well as. Another example is the Norwegian delivery of propulsion packages to Asia’s first gas­powered tugs. Through a contract with the state-owned Chinese oil company CNOOC, Rolls­Royce in Norway has delivered engines, thrusters and control systems to gas-powered tugs which were built at the Chinese shipyard Zhenjiang and delivered in 2015.

Ship of the Year 2017, ”NKT Victoria”: The ship is among the most advanced cabel laying vessels in the world  Built at Kleven ship yard. Photo: NKT

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The success and opportunities of the ocean industries internationally are of great impor-tance to Norway’s prosperity and growth. The OECD estimates that ocean industries can double their contribution to the global economy by 2030. This constitutes a wide scope of opportunities for Norwegian ocean industries, and can contribute to their internationalisation. In 2017, the Government presented its ocean strategy, aiming at sustainable value creation and employment in the ocean industries. The initiatives of the strategy aim to facilitate growth in the established ocean industries, development of new industries, and, not least, the utilisation of sector­specific knowledge across industries through closer collaboration.

Norway’s trading partnersThe countries of the world largely trade with their neighbouring countries, so does Norway. About 2/3 of Norwegian exports of mainland goods go to con-sumption or further processing in Europe. About 25 years ago, more than 80 per cent of Norway’s export of mainland goods went to Europe. Today, the share is 68 per cent. Asia is becoming an increasingly impor-tant trading partner, and especially trade with China has increased significantly. Countries in Africa have also become more important to Norwegian exports. About 4 per cent of Norwegian mainland export went to Africa in 2016. At the same time, it is worth noting that although the percentage of export to Europe has decreased, this is mainly because we export more to other countries, and not necessarily because we export less to Europe. Europe will continue to be be our most important trade partner.

Source: Statistics Norway, foreign trade with goods

Mainland export to continents - 1990

Europe 83 %Africa 1 %Asia 7 %North and Central America 8 %South America 1 %Oceania 1 %

Europe 68 %Africa 4 %Asia 18 %North and Central America 8 %South America 1 %Oceania 1 %

Mainland export to continents - 2016

1990 1991

1992 1993

1994 1995

1996 1997

1998 1999

2000 2001

2002 2003

2004 2005

2006 2007

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2014 2015

2016

Mainland export, percentageNorway´s most important trading partners

0 %

5 %

10 %

15 %

20 %

PolandChina

Denmark

USAGreat BritainGermany

The NetherlandsSweden

Source: Statistics Norway and TAC

The ocean is vital to Norwegian exportNorway is one of the world’s leading maritime nations. Our coastline is one of the longest in the world, and we control ocean areas more than six times larger than mainland Norway. Norway is one of the world’s largest exporters of oil and gas, we are one of the world’s largest and most advanced seafaring nations. We are the world’s second largest exporter of seafood. In addition, we have a world class supply industry including the supply industry for aquaculture and fisheries. Petroleum, maritime and marine industries collectively represent about 70 per cent of Norway’s total export income. The Norwegian ocean industries are highly export oriented, and operate in a global market where there is strong competition for market shares and assignments.

For example, Norconsult has become the project manager of a Canadian project to replace coal as an energy source with natural gas. Norway is one of the leading countries when it comes to handling and transporting natural liquid gas (LNG), as well as. Another example is the Norwegian delivery of propulsion packages to Asia’s first gas­powered tugs. Through a contract with the state-owned Chinese oil company CNOOC, Rolls­Royce in Norway has delivered engines, thrusters and control systems to gas-powered tugs which were built at the Chinese shipyard Zhenjiang and delivered in 2015.

14

Export of Services– 2015

0

5 000

10 000

15 000

20 000

25 000

30 000

35 000

40 000

45 000

50 000

Belgium

ChinaSp

ain

France

Denmark

The Neth

erlands

USA

Sweden

Germany

Great B

ritain

in bill. NOK

Foreign direct investments in Norway

0

25 000

50 000

75 000

100 000

125 000

150 000

175 000

200 000

225 000

250 000

Bermuda

DenmarkUSA

Germany

Great B

ritain

France

Belgium

Luxe

mbourg

The Neth

erlands

Sweden

in bill. NOK

Norwegian direct investments abroad

0

25 000

50 000

75 000

100 000

125 000

150000

175 000

200 000

225 000

250 000

France

Angola

Spain

Belgium

Great B

ritain

Denmark

Singa

pore

Sweden

USA

The Neth

erlands

in bill. NOK

Source: Statistics Norway

15

Sweden, the Netherlands, Germany, Denmark, Great Britain and the US have been the largest recipients of direct export from Norway for a long time. After China’s entry into the WTO and the EU’s expansion into the former Eastern Bloc countries, the Norwegian business community has shifted its export towards new markets. China and Poland are now among Norway’s largest export countries, and represent six and five per cent of Norwegian export revenue respec-tively, calculated from our 25 largest trade partners.

Europe is our most important trading region also when it comes to service exports. The US and China are the most important export markets for services outside Europe.

Foreign companies have made 1,218 billion NOK in direct investments in Norway in 2015. 84 per cent of these investments are made by European compa-nies, five per cent are from the US, and three per cent are from Asia. Norwegian companies have considera-ble direct investments abroad. 1,493 billion NOK was invested in other countries in 2015. 63 per cent of the Norwegian direct investments are in European countries, with the Netherlands, Sweden, Denmark, and Great Britain as the most important ones. 15 per cent has been invested in the US, and 10 per cent in Asia. The figures below show the ten largest countries for foreign direct investments in Norway and the direct investments of Norwegian companies abroad, respectively.

In the autumn of 2015, the global community agreed on a new global agenda for development. The 2030 agenda with its sustainable development goals is anchored in the UN Charter and the declaration on human rights. The sustainable development goals envisage a global effort to eradicate poverty, where no one is excluded. The world is facing great chal-lenges, and it is important that Norwegian businesses see that their products and services can help solve these challenges. The world needs access to more food, and Norway can help with increased production of seafood. Norway’s knowledge of sustainable fisher-ies management and ocean resource utilisation is an export product in itself. The world also needs access to more and cleaner energy, and Norway can contribute by eksporting more hydropower energy, but also by exporting equipment and services for other countries to use in their energy production. The world is also facing challenges associated with an ageing population, and here the Norwegian healthcare industry can seize opportunities in new markets. Furthermore, the world is facing great environmental challenges with pressure on natural resources and the ecological balance, other issues that must be handled is the global spreading of health- and environ-mentally hazardous chemicals and climate change. Norwegian business and industry can find new, larger and more profitable export markets for climate and environmental technology, as well as environmental goods and services, while meeting countries’ needs to implement efficient environmental and climate policies.

Ocean farming. Illustration: Ocean Farming

18

Opportunities and Challenges

Top: Drone technology [one of the many new instruments that is used by the classification company DNV GL for complex inspections of vessels and offshore installations in a more secure, efficient and economic manner, globally. Photo: DNV GL/Alexander Schneider

Bottom: Ten kilometers out from the south-west coast of Norway Statoil’s Hywind-demo has tested the next generation technology since 2009 − such as this, the worlds first floating wind turbine. Photo: Statoil/Øyvind Hagen

19

Opportunities and Challenges

3.1 Trade policy in a time of changeIn order to maintain high employment rates and a high wage level, Norway depends on international trade. Good, predictable terms for trade between countries are one of the prerequisites for this. Membership in the World Trade Organization (WTO), the EEA agreement4) and an increasing number of free trade agreements contribute to creating this framework. Through the WTO, Norway is part of a worldwide regulatory framework for trade with a common dispute settlement system. In order to obtain improved market access and more ambitious rules beyond what the 164 WTO members have agreed on, Norway negotiates free trade agreements with countries where we have special interests. We currently have 29 such agreements with a total of 40 countries. The EEA agreement makes Norway part of EU’s internal market with a common regulatory framework and regulatory development which ensure equal terms of competition in the EEA.

The international trade picture is changing. The centre of gravity of the global economy is gradually shifting to the east and south. At the same time, our trade interests shift. The European share of goods export from mainland Norway has been reduced from 82 to 67 per cent since 1990. In the past decade, there has been a considerable growth in the export of goods and services to Asia. Export to countries in Africa and South America has also increased, although it is important to note that this growth is from low levels. There is reason to believe that this tendency will continue, and that we will see the strongest growth in emerging economies in the future.

Norway is currently enjoying well-functioning trade relations with its closest trade partners, not least through the most important trade agreement

4 Agreement on the European Economic Area

– the EEA agreement. This agreement implies that our export currently faces lower tariffs and predictable terms in the most important export markets. At the same time, we do not have trade agreements with six of the world’s ten largest economies, and we increas-ingly export to countries with which we have no trade agreements. Our export faces higher tariffs and other trade barriers in many of these countries compared to our traditional trade partners.

While the world is becoming more closely integrated, Norway, risks being left out of the further development of the framework for international trade. Trade policy develops increasingly through regional and plurilateral initiatives, rather than in the WTO. In the multilateral system we also see a movement in the direction of so-called plurilateral agreements. Norway has been an active contributor to several such negotiations, including the negotiations on an agreement on trade in services – TISA (Trade in Services Agreement). At the same time, we are not part of extensive negotiation processes across the oceans, so­called mega­regional negotiations. Although some of these processes have not had the expected progress, it is likely that they will influence the future trade policy landscape. Norway has very limited prospects to influence these processes, while our interests will still be affected.

These trends indicate that Norway could end up in an challenging position when it comes to securing compet-itive framework conditions for the export companies in the long term. Being a small and open economy, Norway depends on a regulatory based world trade and good access to export markets and we are vulnera-ble to trade barrier measures. This is particularly important in a time where protectionist thinking seems to be gaining increasing support in some parts of the world. It is therefore in Norway’s interest to advocate for free trade and a regulatory based global trade regime.

20

Norwegian trade policy interests mirror the changes in international economy, where investments and trade in services have become more significant. Liberalisa-tion of trade policy frameworks for investments and for trade in services is in many cases less advanced than for trade in goods. Norway therefore depends on a strategic and active trade policy. This involves strengthening and maintaining existing multilateral institutions, as well as signing bilateral free trade agreements with markets that are of importance for the Norwegian business community.

Norway has also established bilateral economic commissions with a number of countries important to the Norwegian business community, such as China, Brazil, Korea, Russia, Germany, Ukraine, and the US. We also work to establish commissions with India and Turkey. Through these commissions, Norwegian authorities can discuss framework conditions and issues facing the Norwegian business community.

3.1.1 EEA and the European Single MarketThe EEA agreement is Norway’s most comprehensive and fundamental international agreement. The agreement forms the basis for the Norwegian Euro-pean policy, and it is our most important agreement framework with European partners. Based on the fact that about 80 per cent of our total export of goods goes to the EU, and more than 60 per cent of our import of goods comes from EU member countries, a well-functioning EEA agreement is vital to the success of Norwegian businesses in the EU.

The EEA agreement expands the Norwegian home market from 5 to 500 million people and from a little less than 300,000 to more than 26 million enterprises.5)

5 Source: Eurostat. Enterprises with revenue and/or employment in 2014. Industries A (primary industries), O (public administration), T (paid housework in private households), U (international organisa-tions and bodies), and holding companies are not included.

This is possible due to common rules on free move-ment of goods, services, people, and capital. Standards have been a key instrument in creating a well-function-ing Single Market in Europe. The competition regula-tions for enterprises in the EEA shall secure equal terms for competition and does not depend on the country in which the enterprise is established. The regulations on public procurement enable Norwegian businesses to compete for the delivery of goods and services to public enterprises all over the EEA. The government subsidy regulations contribute to equal terms of competition between businesses by regulating and limiting the allocation of public subsidies to enterprises. Other regulations, including regulations on social welfare policy, consumer protection, environ-ment and corporate law, also contribute to equal terms of competition.

The EEA agreement has been, and still is, vital to the development of the Norwegian economy, business and foreign trade. It is a key part of the regulatory framework that contributes to stability and predicta-bility in Norway’s economic interaction with its most important neighbours and trade partners. Norway participates in the EU’s program for innovation, research and education. This is an important instru-ment that connects Norwegian research communities and the Norwegian business community to the world’s best research environments.

In addition to the considerable trade in goods and services between the EU and Norway, European ownership in Norwegian businesses and investments is significant. 20 per cent of the members of staff were employed by EU­owned businesses, and in 2011, 2/3 of foreign investments in Norway were from the EU. At the same time, 2/3 of Norwegian foreign invest-ments were in the EU. We are closely interwoven with the Single Market. In total, this regulatory framework has been of great significance for the Norwegian

Export and trade contribute to economic growth and job creation in Norway

21

business community. Predictability, equal rules and equal terms of competition are vital for a business to succeed in international markets.

The cooperation with the EU in the field of fisheries and aquaculture is of great importance to Norway, although fisheries policies and the management of marine resources are not part of the EEA agreement. The fisheries cooperation between the EU and Norway is based on bilateral agreements, while the trade in fish and seafood is regulated through a separate protocol in the EEA agreement and several bilateral agreements. The regulatory framework with the EU does not secure the seafood industry free market access in the EU, or protection against antidumping and subsidy meas-ures in the EU. The veterinary aspects of fisheries and aquaculture are covered by the EEA agreement. Trade in seafood is therefore not subject to border control within the EEA area.

The Single Market is in constant development. The EEA agreement ensures that Norwegian businesses take part in this development. It is in the interest of the Norwegian business community that the EEA agreement maintains its strong and dynamic position, especially in a time where the EU is looking for a way forward. Norwegian authorities must continue to give contributions to the development of the regulatory framework of the Single Market, and through this advocacy secure the best possible framework condi-tions for Norwegian businesses to succeed in the EEA. The Norwegian business community is a key partner, and gives its contributions to the EEA process through national authorities as well as its European umbrella organisations. Norwegian businesses experiencing and utilizing the opportunities in the Single Market as their home market, will contribute to increased trade in the EEA.

3.1.2 BrexitOn 29 March 2017, the United Kingdom invoked Article 50 in the Treaty on European Union, regulating with-drawal from the EU. Norway is not part in the negotia-tions on the arrangements for the United Kingdom’s withdrawal from the EU, however, we are directly affected since the United Kingdom also withdraws from the EEA cooperation and our other agreements with the EU, which to a large extent regulate our current cooperation with the United Kingdom. Only members of the EU or the European Free Trade Association (EFTA) have access to membership in the EEA.

It is important for Norway to maintain the best possible trade policy cooperation with the United Kingdom, as well as the best possible access to the British market, while safeguarding the EEA agreement and Norway’s other agreements with the EU. After the British exit, EU will continue to be our largest market and our closest partner. At the same time, we have a good dialogue with the United Kingdom on bilateral industry and trade policy matters. This dialogue will continue also after Brexit has taken place.

The British exit from the EU also raises issues of significance to Norway with regard to the rights of Norwegian citizens, fisheries management, trans-port, security, police and judicial cooperation, environ-mental and climate cooperation, and research. The United Kingdom is also a key partner in the energy sector. Besides, Brexit will bring about consequences for policy development and forms of cooperation in Europe. It may also create challenges and opportuni-ties for Norway.

Norway is, due to its close integration with European Single Market through the EEA agreement, not a regular third party when the EU and the United Kingdom are to negotiate a new framework for their trade policy cooperation. It is important that the solutions negotiated between the EU and the United

Norwegian prime minister Erna Solberg in a meeting with China’s president Xi Jingping. Photo: Ministry of Trade, Industry and Fisheries

22

Kingdom, secure a well­functioning Single Market in the entire EEA area. We are in close dialogue with the EU on the parts of the negotiations that affect the internal market, including possible transitional arrangements, and we meet acceptance for our request to be con-sulted during the course of the negotiations. A contin-ued well-functioning EEA cooperation is also in the EU’s interest.

3.1.3 Lack of regulation for export credit programs from emerging countriesThe Norwegian Export Credit Guarantee Agency (GIEK) and Export Credit Norway offer officially supported export credits which promotes Norwegian export and investments abroad. Export Credit Norway grants loans to buyers of Norwegian exporters’ goods or services, and must obtain guarantees for each loan from GIEK and/or another financial institution with acceptable credit rating. This system contributes to a level playing field between Norwegian exporters and exporters from other countries with similar schemes, and is a supplement to the private financing market. All countries would benefit if competition between exporters is based on the goods and services provided instead of the terms and conditions of the financing. If Norway did not offer officially supported export credits, Norwegian exporters could be ousted in situations where competitors from other countries offered such export credits in connection with their goods and services.

Norway takes part in a ”gentleman’s agreement” associated with the OECD, Arrangement on Officially Supported Export Credits (”Arrangement”), that regulates terms and conditions for officially supported export credits. The purpose of the agreement is to secure a level playing field between exporters in the countries that take part in the agreement. In this way, competition is based on the quality and price of the product, rather than the financing.

According to an annual report from the US, 22 coun-tries have a noteworthy level of officially supported export credits, as shown in the figure below.6) Seven countries in the figure do not take part in the existing international agreement. These seven countries (Brazil, India, Israel, China, Russia, South­Africa, Turkey), in addition to Malaysia and Indonesia, participate in negotiations on a new international agreement together with the OECD countries that are part of the existing agreement. It is a challenge for Norway and Norwegian exporters that several countries with an extensive offer of officially supported export credits, are not subject to the same regulations as GIEK and Export Credit Norway.

3.2 An attractive Norway 3.2.1 Promoting Norway as an attractive country for investments and leading academic environments and talents Norway must secure its position in the global race for hosting future jobs, bright minds and good investments in order to stimulate economic growth in Norway.

There are many factors that decide whether interna-tional enterprises establish and develop business in Norway, or whether foreign entrepreneurs choose Norway as their host country. Basic framework condi-tions such as access to transport infrastructure, education and wage level of employees, labour market and working conditions, technical infrastructure, taxes and fees, as well as public and private demands, are key factors. Several of these factors can be affected by national, county municipal and municipal authorities. Access to labour with adequate qualifications is necessary to secure industrial restructuring and economic growth. It is important that businesses

6 2015 EXIM Bank Competitiveness Report; http://www.exim.gov/sites/default/files/reports/2015EXIMCompetiti-veReportFINAL-v3.3.pdf

Officially supported export credits in 2015 in billion USD

0 10 20 30 40 50 60

ChinaEu-countries total

GermanyKorea

FranceFinland

USAItaly

JapanIndia

BrazilThe Netherlands

SpainCanadaSweden

DenmarkNorwayAustria

Great BritainRussiaIsrael

South AfricaTurkey

Source: The 2015 EXIM Bank Competitiveness Report

23

are able to recruit the labour they need in order for the business community to be competitive. To ensure efficient processes when recruiting from abroad, the Government has strengthened the service centres for foreign employees, and simplified the regulatory framework.

Businesses also depend on good offers to households in order to recruit labour. Municipal services, schools, including international schools for children, and cultural services influence the decision to move, particularly for young and educated households. The fact that Norway is a safe country with sound childhood and working conditions, and promotes gender equality, may also influence the decisions of foreign employees to settle here. Households and businesses will also focus on technical infrastructure such as planning and development, water and drain-age, as well as the processing of building applications and development plans. At the same time, proximity to the market, distance to other production facilities, and a number of other matters are vital to the location decisions. The Government is implementing a number of simplification measures that will contribute to faster planning processes and increased local freedom of action.

Norway aims to be one of the countries where the world’s most talented students and researchers wish to go. By cooperating on a high international level, Norway will appear as an attractive partner for researchers and students. This also applies to the national and global business communities, which use increasingly advanced knowledge in order to compete in global markets. It is therefore in Norway’s interest to facilitate attractive academic and business communi-ties and support Norwegian research institutions and institutions for higher education to maintain high quality of education and research activities.

Norway is a high-cost country. Consequently and in order to succeed, we must think smarter and be more innovative than our competitors. In order for Norway to defend its position in the global competition, a larger percentage of Norwegian export businesses must utilize research­based knowledge, invest in R&D, and use research based innovation to fully exploit the value creation potential within social challenges, Norwegian natural resources and technology.

In order to maintain Norway’s high standard of living over time, we must, like other high­cost countries, compete in knowledge as the basis for innovation and increased productivity. The ability to develop and adopt new knowledge is among the most important competi-tive factors for the Norwegian business community. It is vital for the industrial restructuring of existing industries as well as a basis for new industries. A prerequisite for this is that the link between educa-tion and research can form the basis for advanced innovation.

Experience shows that it is difficult to relocate environ-ments with expert knowledge. Consequently, Norway should attract investments in fields where we are already quite advanced internationally with regard to knowledge. This is to strengthen our strongest environments further and contribute to more R&D activity. Norway must promote itself as a leading research and innovation nation in selected areas. In the Government’s white paper no. 7 (2014–2015) “Langtidsplan for forskning og høyere utdanning 2015–2024” (Long-term plan for research and higher education 2015–2024), the Government commits to increased appropriations to research and higher education within six long­term priority areas, such as Seas and Oceans, where Norway enjoys clear strategic advantages. Another of the six priority areas is World leading academic groups. Developing academic groups of excellent quality is one of three overall goals in the long-term plan. The Government’s focus on world

LabRiksen. Photo: Innovation Norway

24

leading academic groups has so far been followed up with more than 300 million NOK in the budgets from 2015–2017. For example, the Government has ear­marked funds to universities for recruiting top level researchers and increased the funding for instruments such as Independent projects and Norwegian Centres of Excellence (SFF). Through the long­term plan, the Government has also strengthened some of the key input factors in Norwegian research and higher education, through escalation plans for more recruit-ment positions, increased appropriations for research infrastructure, and increased appropriations for schemes stimulating Norwegian participation in the EU framework programme for research and innovation, Horizon 2020.

The effort to develop more groups of excellence in Norway also includes a strengthening of the education and research cooperation with eight priority countries outside the EU. Knowledge cooperation with the US and Canada is still a high priority. In 2015, the Govern-ment presented Panorama – Strategy for cooperation on higher education and research with Brazil, China, India, Japan, Russia and South Africa (2016–2020). The goal is to facilitate a more general and long-term cooperation with these countries in higher education and research, aiming at more high­quality cooperation in areas of particular interest to Norway. For example, the Panorama strategy states that higher education and research cooperation must be seen in connection with international activities, competence needs and innovation priorities of the Norwegian business community.

BN21 is a specific example of this type of cooperation. This is a research and technology cooperation between Norway and Brazil in the petroleum field, established in 2013. Our two countries share many of the same technological challenges, and we both have large offshore petroleum reserves. Brazil is also one of the largest international markets for the Norwegian

high­tech supply industry, and a number of Norwegian companies deliver to this growing market. In 2016, the Research Council of Norway and its Brazilian counter-part implemented a joint call for applications for R&D funding for the first time. This was a success, and a new joint call for applications is in progress. Besides, there are plans to take the cooperation to other fields, such as research cooperation in renewable energy.

Modern equipment is important for Norway in order to be attractive to the best international researchers, and in order of ur to assert ourselves in international competition, and for the business community to consider cooperation with Norwegian academic environments profitable. The Research Council’s national research infrastructure scheme is a success - ful tool for ensuring that funding of large research infrastructures is allocated to high quality, strategically important projects.

A general feature of many Norwegian businesses and clusters which today are world leading in their fields, is that they widely cooperate with regional, national and international R&D institutions and business communities. R&D cooperation and participation in consortiums around R&D projects contribute to their internationalisation as well as a strengthening of the competitiveness of Norwegian businesses. This enables businesses to develop cooperation with relevant academic environments and R&D institutions. It also gives businesses access to an expanded ecosystem of other businesses, including potential clients, suppliers and investor communities, as well as to new markets at home and globally.

The universities’ and university colleges’ main contri-bution to value creation, is preparing candidates for employment. The Government has also presented a white paper on quality in higher education, Meld. St. 16 (2016-2017) Culture for Quality in Higher Education.

Apprentices in action at the Norwegian University for life sciences (NMBU). Photo: NMBU

25

This white paper is part of the Government’s long-term focus on quality in all levels of the knowledge sector.

Norway has ambitious climate and environmental goals, and we have one of the world’s highest percent-ages of renewables in the energy consumption with nearly 70 per cent. Consequently, Norway’s industry burdens the environment less than similar industries in other countries. This could be an increasingly competitive advantage for the export of Norwegian products and services, but also for attracting foreign investments and competence to Norway.

Another important area for promoting Norway as an attractive country, is digitisation. Here, Norway is among the leading nations in Europe. The DESI Index measures the digital infrastructure of EU countries, the extent to which the businesses utilize digital technology, the use of public digital services, technol-ogy competence, and the use of technology and services in society. According to DESI, only Denmark is further ahead than Norway in digitisation. Norway is advancing on most indicators, and scores higher on the digitisation of the public sector compared to last year’s index. The index also shows that Norwegian businesses utilize new technology to a greater extent than the rest of Europe, and that Norwegian busi-nesses use e-commerce to a greater extent than elsewhere in Europe.7) The Government is actively working to promote the efforts of free movement of data in the EEA area. It is important – also for Norway – that European companies have framework conditions enabling them to be competitive to the large American and Asian suppliers. The current challenge is that the regulatory framework is implemented or interpreted differently in the various countries. The Government has pointed out to the EU Commission the importance of free movement of data if we are

7 https://www.regjeringen.no/no/aktuelt/i-europa-toppen-pa-digital-isering/id2541946/

to achieve a real digital common market and keep up with the digital economy.

We work to make sure that persons with competence and talent choose Norway when looking for a place to establish their activities and make investments. By strengthening Innovation Norway’s Invest in Norway programme, we aim to assist more foreign businesses considering locating to Norway.

As a follow-up of the Government entrepreneurship plan ”Good ideas – future jobs”, Innovation Norway was tasked to study a fast-track scheme for particularly promising entrepreneurs aiming to realize their ideas in Norway (Start in Norway). The study also considers the need for facilitation for foreign investors who wish to establish business in Norway, better facilitation for more foreign students and PhD candidates to start business in Norway after completing their degrees, as well as better facilitation for start up companies to quickly recruit competent labour from abroad. The Government will evaluate the recommendations of the study when it is available.

We do not have reason to believe there is a general lack of capital in Norway. Nevertheless, for small and medium sized entreprises, access to capital can be a challenge. The Government has established a panel that will publish an official report on this topic. Furthermore, the Government has increased the scope of Innovation Norway’s nation-wide innovation loans and guarantees, that aim to strengthen the access to public risk capital and release private capital. As stated in the Industry Report, the Government has appointed a public committee to assess whether Norwegian enterprises have sufficient access to capital for profitable projects.

3.2.2 Reputation and brandingA strong national brand can contribute to making Norway and Norwegian solutions attractive, which

The private sector creates value for our common welfare

leading academic groups has so far been followed up with more than 300 million NOK in the budgets from 2015–2017. For example, the Government has ear­marked funds to universities for recruiting top level researchers and increased the funding for instruments such as Independent projects and Norwegian Centres of Excellence (SFF). Through the long­term plan, the Government has also strengthened some of the key input factors in Norwegian research and higher education, through escalation plans for more recruit-ment positions, increased appropriations for research infrastructure, and increased appropriations for schemes stimulating Norwegian participation in the EU framework programme for research and innovation, Horizon 2020.

The effort to develop more groups of excellence in Norway also includes a strengthening of the education and research cooperation with eight priority countries outside the EU. Knowledge cooperation with the US and Canada is still a high priority. In 2015, the Govern-ment presented Panorama – Strategy for cooperation on higher education and research with Brazil, China, India, Japan, Russia and South Africa (2016–2020). The goal is to facilitate a more general and long-term cooperation with these countries in higher education and research, aiming at more high­quality cooperation in areas of particular interest to Norway. For example, the Panorama strategy states that higher education and research cooperation must be seen in connection with international activities, competence needs and innovation priorities of the Norwegian business community.

BN21 is a specific example of this type of cooperation. This is a research and technology cooperation between Norway and Brazil in the petroleum field, established in 2013. Our two countries share many of the same technological challenges, and we both have large offshore petroleum reserves. Brazil is also one of the largest international markets for the Norwegian

26

in turn can promote trade and attract tourists, compe-tence and investments to Norway. In the international reputation survey “National Brands Index” from 2014, Norway was ranked 13th out of 50 countries with global influence.8) International relations are based on trust, and a good reputation contribute to create a perception of Norwegian businesses and organisations as attractive partners.

Innovation Norway has initiated efforts to help develop a strong national brand for increased competitiveness. The initiative is called Brand Norway, and its purpose is to make Norway more attractive. As part of the Brand Norway initiative, Innovation Norway has conducted surveys among business executives in 17 countries in order to find out how Norway and Norwegian businesses are perceived internationally. The survey shows that the Norwegian business com-munity is regarded as highly specialized with a range of quality products, however, many Norwegian companies need to improve their skills at market orientation and international marketing.9) Innovation Norway offers services supporting businesses to become more successful at growing internationally. It is important that such services are adjusted to the businesses’ needs in various market.

The Foreign Service plays an important part in promo-ting Norway’s reputation by presenting Norwegian businesses and culture abroad, but also by promoting Norway as an attractive destination for foreign invest-ments and foreign talents. Every year, funds are made available for business activities, including cultural and creative industries, at Norwegian Embassies and Consulates. The purpose of these funds is to help coordinate and strengthen the public initiative

8 https://www.regjeringen.no/no/tema/utenrikssaker/inter_kultur/norgesprofilering/norges­omdomme­er­solid­og­stabilt/id2343395/

9 http://www.innovasjonnorge.no/no/merkevarennorge/norge-2016-sterke-pa-produkt-svake-pa-marked/

to promote Norwegian export, business interests and Norway’s position as an attractive country inter-nationally. The Foreign Service works in close contact with relevant communities and ministries.

Many publicly supported stakeholders promote Norwegian companies abroad. Innovation Norway promotes Norway as a tourist destination on commis-sion from the Ministry of Trade, Industry and Fisheries through among other things the official tourism portal visitnorway.com. In joint campaigns with the tourism industry, Innovation Norway finances profile market-ing, while individual businesses finance their own sales promoting part of the campaigns. Innovation Norway is also responsible to promote the scope of the Norwegian business community and Norway as an attractive country for investments. It is important to demonstrate the added value of increased cooperation between actors in culture and tourism and to stimulate knowledge building. In this context, the Government is working on a strategy for culture and tourism, with emphasis on cultural tourism. The Norwegian Seafood Council works closely with the Norwegian fisheries and aquaculture industry to develop markets for Norwe-gian seafood. Norwegian Energy Partners (NORWEP) plays an important role in bringing out the energy industry. The stakeholders in Norwegian Arts Abroad promote the creative industries.

Official visits also contribute in promoting Norwegian business abroad. When representatives of the Royal Family or the Government visit other countries, the visits are often used to promote Norwegian business. Such visits contribute in making Norway known and to establish relations that are useful to the Norwegian business community. Innovation Norway organizes business delegations in connection with state visits or official visits. When planning the delegations, it is important to identify the main interests and objectives for the visit from both sides, so that the composition of the business delegations is aligned accordingly.

Trade and investments enable transfer of knowledge and technology, and strengthens learning and innovation

Norwegian minister for trade and industry Ms Monica Mæland visits

Nachi­Fujikoshi Corporation in Japan, the world’s 6th largest priucer of industrial robots. PPM AS in Trondheim, Norway

has delivered vital parts of the steering systems to the Nachi-robots.

Photo: Trond Viken/NFD

27

This type of visits could also be used strategically to strengthen and further develop cooperation in areas at the intersection between business promotion and international cooperation in other areas, such as promoting knowledge and possible connections between business/innovation, education and research. The Embassies and Consulates, Innovation Norway’s foreign offices, Norwegian Energy Partners and the Norwegian Seafood Council are, together with local Norwegian chambers of commerce, key actors in implementing such visits. In order to obtain the best possible effect, the actors coordinate among them-selves, and in consultation with the relevant ministries through Team Norway.

Also, relevant government officials and key stakehold-ers are invited to Norway in order to create interest for the Norwegian business community. This exchange of political visits helps establish arenas for dialogue for the Norwegian business community and its partners. There are ongoing efforts to compose the business delegations in such a way that they are perceived as a most relevant instrument for all industries.

Another arena for promoting business, is world exhibitions (EXPO). A world exhibition is an interna-tional meeting place for stakeholders from business, organisations, research environments, culture, and authorities. Norway last attended a world exhibition at the EXPO 2012 in Yeosu. Norwegian participation at EXPO 2020 in Dubai is currently under consideration. Attendance at other international trade fairs is also an important part of the efforts to promote Norwegian business abroad. Several stakeholders in the public support system coordinate attendance at fairs within their areas. Innovation Norway has up to 100,000 visitors to their pavilions annually when coordinating Norwegian attendance at international fairs, and this constitutes a good platform for strategic market positioning and reputation building for the Norwegian business community.

3.3 Competitiveness and innovation capability Knowledge and competence are important competitive factors for the Norwegian economy. This is particularly pronounced in Norway because of the high cost level. The ability to develop, absorb and utilize knowledge is vital to our competitivness. In many cases we simply cannot provide the lowest prices. For this reason, we need to work smarter and compete on products and solutions with quality and special features that justify a higher price. This applies to the business community as well as the public sector.

International agreements, economic development in other countries, as well as unpredicted developments in the world around us, affect the access to and the need for competence in Norway.

Increasing demands are made on employees. The combination of increased digitisation and a higher level of education in the population means that a tougher fight for jobs can be expected for those who have not completed upper secondary education. For all levels of education, the way we do our jobs will change with technology development. Exchange of knowledge across countries – whether between employers, employees or the population at large – can make us better prepared for the future.

These matters also make it necessary for Norway to focus on research, education, and technology.

3.3.1 Research, education, and technology developmentResearch, education and technology development are vital to the development and adoption of new knowledge, and for converting it to innovative activity and increased productivity.

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One of the most important contributions to innovation and industrial restructuring of Norwegian business, is the preparation of candidates who bring new knowledge into the enterprises. Future business depends on how many choose to take higher educa-tion, what they learn, which subjects they choose to study, and whether they are able to complete their studies. In this regard, internationalisation plays an important role, and student mobility should therefore be regarded as a long-term investment in the further development of Norway as a knowledge nation.

A general rise in the level of R&D investments in the business community is also necessary to ensure the ability to restructure and increase knowledge intensity. Such research involves advanced knowledge development and application in the entreprises. This forms the basis for further development and restruc-turing of products and processes. Experience from own research and knowledge development is also a prereq-uisite for understanding and utilizing the knowledge being developed, in order to make safe and appropri-ate business procurements, and to be able to partici-pate in R&D cooperation.

Mostly, new knowledge is being developed abroad. Access to and understanding of this knowledge are vital to the development of Norwegian businesses. Internationalisation of R&D helps improve the quality and relevance of research, contribute to import of new knowledge and build networks with strong foreign research and business environments. Participation from the business community in international R&D cooperation is important in order to ensure early national access to the knowledge being developed abroad. Thus it is important that Norwegian businesses use the existing national instruments for international cooperation as much as possible, including the EU framework programmes for education, research and innovation.

It is the Government’s ambition that Norway shall become one of the most innovative countries in Europe. We therefore focus on business oriented research and innovation in areas where we have expert knowledge or good prerequisites. International cooperation in these areas is important in order to help develop a more knowledge-intensive business community that is able to adopt to new situations and create value.

LanguageKnowledge of foreign languages is the key to under-standing people from other countries and cultures. To this there is also a more practical aspect: Norwegian businesses need language skills and cultural under-standing in order to operate and compete inter-nationally.

Language skills are also of great value in combination with other education. An engineer or economist who masters foreign languages, will be highly attractive to many enterprises.

In order to ensure a competitive business community in Norway, it will be necessary to educate candidates with relevant language and cultural skills. The Govern-ment therefore wants to stimulate more Norwegian students to pursue such studies in selected non- English-speaking countries.

The Government’s strategy for cooperation with Germany states that Germany is Norway’s most important partner in Europe, and that the Government will “stimulate increased interest in the German language and Germany in schools and among students”.

In the Government’s white paper no. 25 (2016–2017) The Humanities in Norway, it is stated that the Ministry of Education and Research has provided funding for

Norwegian Minister for Fisheries Mr Per Sandberg serves Norwegian salmon to Chinese journalists at Mathallen in Oslo. Photo: Norwegian Seafood Council

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the establishment of a position at the ANSA office with particular responsibility for Germany. In the autumn of 2016, a conference was arranged in order to stimulate increased interest in the German language in schools and among students in cooperation with, among others, the Confederation of Norwegian Enterprise, the Norwegian­German chamber of commerce, and the Embassy of the Federal Republic of Germany in Norway.

Through the Panorama strategy, the Government has selected a group of strategic partner countries in higher education and research: Brazil, India, Japan, China, Russia, and South Africa, in addition to the US, Canada, and the EU. China is emerging as the world’s largest economy and the second most important research nation, and although communication mostly is in English, it is obvious that Norway will need competence in the Chinese language.

It is a fact that Norwegians have good knowledge of English. English has an obvious position as an interna-tional research language, and in all forms of interna-tional activity, English is the dominant language. English will therefore remain a key subject in schools and higher education.The fact that the Government wants more Norwegian exchange students to stay in non­English­speaking countries, does not mean that fewer students should go to English-speaking coun-tries.

3.3.2 Standards help reduce trade barriersStandards reduce trade barriers, contribute to innova-tion, and ensure that products and services have the intended quality and features in accordance with the requirements of the market and the authorities. International standards contribute to common rules and reduce the risk of trade, and make it easier for businesses to compete in global markets. A well-

functioning standardisation system is therefore of great significance for growth and value creation.10)

International work on standardisation gathers leading knowledge communities from various coun-tries. Standards are created through consensus-based processes where all relevant stakeholders are invited to participate. Representatives from the business community, researchers, NGOs and authorities gather around the same table to define the best technical solutions. With standards in place, common rules have been developed which in turn create trust and make efficient interaction easier for the participants. Busi-nesses participating in international standardisation, have an advantage when the standards have been developed.

International standardisation work lays premises for the development of new products, processes and services. Through Norwegian businesses’ active participation, Norway is better equipped to handle the challenges of industrial restructuring in the future.

3.3.3 Securing, handling and utilisation of intangible assets and intellectual property rights Good management of intangible assets can be vital for the enterprises’ ability to open up and compete in new markets, obtain capital and form partnerships and alliances. The extent and significance of intangible assets are increasing. According to US index Standard & Poor 500, tangible assets represented 83 per cent of the market value of companies in 1975. In 2015, the same share, 83 per cent, of the market value was related to intangible assets. Intangible assets are becoming an increasingly important basis for compa-nies’ value creation. The Norwegian Industrial Property Office grants rights to brands, designs and patents.

10 Centre for Economics and Business Research Ltd (Cebr). (2015). The Economic Contribution of Standards to the UK Economy. London: BSI

The food we harvest from the oceans are in demand across the world

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Businesses entering new export markets wishing to maintain their competitiveness, must have a high degree of consciousness with regard to securing, utilizing and enforcing their intellectual property rights. There are considerable challenges in the markets in China and East Asia with regard to system-atic infringement of the immaterial property rights of others. Businesses must also relate to the rights and positions of others. A conscious strategy for securing and utilizing intangible assets and intellectual property rights should be developed at an early stage and be an integrated part of the business strategy.

The businesses are responsible for handling their own intangible assets. However, the authorities may facilitate with good framework conditions for business development and innovation, as well as contribute to sufficient competence on intellectual property rights and intangible assets. The main goal of the Govern-ment’s policy in this area is to help the Norwegian business community utilize the potential for value creation inherent in good handling of the businesses’ own intangible assets and intellectual property rights.

3.3.4 Green competitivenessThe Paris Agreement became effective in November 2016. The main objective of the agreement is to keep global warming well below 2°C, and that the countries strive to limit the rise in temperature to 1.5°C com-pared to the pre­industrial level. This is the first legally binding climate agreement with real participation from nearly all countries. The countries have committed to report nationally defined contributions in line with the principles of progression and the highest possible ambition. All parties are encouraged to formulate and report long-term low-emission strategies.

Norway’s national goal is to become a low-emission society by 2050. This goal is enshrined in the recently adopted climate law. At the same time, in the climate

settlement, the majority of the Storting pointed out that those ambitious policies must be sensible in a global context where the overall goal is to reduce global emissions of greenhouse gases. This implies that we must take into account the consequences of the quota system, the risk of carbon leakage and the industry’s competitiveness when formulating policy. This provides guidelines for the use of measures to reduce national emissions by both 2030 and 2050. Norway as a low-emission society is dependent on support from the development abroad.

A world that is moving in the direction of lower emis-sions will have to develop and adopt new technology and new energy sources, and will to some extent demand other goods and services than they do today. A rapid reduction in global emissions will require the development of renewable energy such as wind and solar power. The spread of environmental pollutants, loss of biodiversity, local pollution and pressure on water resources also constitute serious problems. In order to ensure sustainable development in the future, it is important to reuse resources to a greater extent than we currently do, instead of utilizing new ones. There is increased international focus on and interest in circular economy.

Stricter climate policy and rapid technology develop-ment, including in renewable energy, low­emission transport and circular solutions may provide new market conditions for Norwegian businesses. Green competitiveness means that Norwegian businesses need to be competitive in a time when the climate policy is becoming more stringent all over the world. Adaptation to changed framework conditions will require restructuring and involve costs, but also provide new business opportunities. More than 80 per cent of Norwegian greenhouse gas emissions have a price tag in the form of a tax or participation in the EU quota system, and Norway is a country with strict

More than 70 per cent of Norwegian exports come from our ocean industries

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environmental regulations. Norwegian businesses have demonstrated that it is possible to turn strict environ-mental and climate regulations into a competitive advantage. For example, the Norwegian maritime cluster is at the forefront with regard to developing and adopting technology and concepts that contribute to lower emissions and a better environment. Also, the Norwegian process industry has met the continu-ous and increasing global competition by focusing on the development of new technologies that make the production process more efficient with regard to energy, costs, and environment.

Norway is well positioned to manage such a restruc-turing. Several Norwegian businesses are far ahead in adopting new solutions in the maritime sector, renewable energy, CO2 capture, aquaculture and the marine sector, bioeconomy, material technology, smart buildings, and circular solutions. Restructuring to a low­emission society also affects the work on export and internationalisation. The Government has there-fore presented a a plan to market Norwegian green solutions. The purpose is to increase export and to attract international investors to Norway. Innovation Norway will enter into a close cooperation with Norwe-gian businesses for this purpose. The EEA funds are another scheme that also provide Norwegian compa-nies with opportunities for participation in coopertion on green competitiveness.

The Environmental Goods Agreement (EGA) is a multinational initiative under the WTO system including 18 negotiating parties (where the EU counts as one), which has been ongoing since 2014. The purpose of the agreement is to lower or eliminate tariffs and thus contribute to increased use of environmental goods. The environmental goods negotiations are relevant for implementing the Paris Agreement, given the positive environmental effects of greater use of environmental technology. In the negotiations, Norway has promoted

Norwegian environmental technology such as bat-tery­powered ferries, solar powered lamps, various types of water and wastewater treatment, equipment for aquaculture, turbines for hydroelectric power plants, and insulation materials. Norway has also focused on goods particularly suited for use in poor and vulnerable countries, such as solutions for clean drinking water. Since the ministerial conference in December 2016, where the parties were unable to reach an agreement, it has been unclear how and when the environmental goods negotiations will continue. Norwegian priorities should be followed up when the negotiations resume, and any new goods should be presented if there is room for this.

Norway has large renewable power reserves, and has competence and capital in the power sector, especially in hydroelectric power. We are therefore well posi-tioned to take part in the value creation which is expected to come in the development of renewable energy abroad, including in developing countries with large untapped potential.

The Paris Agreement provides for a system of succes-sive national contributions and promotes a process where the parties will implement gradually more ambitious climate policies. Norway contributes actively through a high level of contributions to climate funding for developing countries (among the highest per capita), as well as through leadership in order to facilitate technology cooperation with developing countries, for example as the principal contributor to the Climate Technology Centre and Network (CTCN), which is an operative follow-up of the Paris Agreement in technology cooperation. The CTCN receives and responds to requests for funding of technological climate solutions from developing countries. The secretariat is in Copenhagen, hosted by the UN Industrial Development Organization and the UN Environment Programme. In order to get assignments

The world’s first ferry run by batteries has been in operation between Lavik and Oppedal since 16. february 2015. The ferry was built by the yard Fjellstrand in Hardanger, and is operated by Norled. Photo: Nordled

Businesses entering new export markets wishing to maintain their competitiveness, must have a high degree of consciousness with regard to securing, utilizing and enforcing their intellectual property rights. There are considerable challenges in the markets in China and East Asia with regard to system-atic infringement of the immaterial property rights of others. Businesses must also relate to the rights and positions of others. A conscious strategy for securing and utilizing intangible assets and intellectual property rights should be developed at an early stage and be an integrated part of the business strategy.

The businesses are responsible for handling their own intangible assets. However, the authorities may facilitate with good framework conditions for business development and innovation, as well as contribute to sufficient competence on intellectual property rights and intangible assets. The main goal of the Govern-ment’s policy in this area is to help the Norwegian business community utilize the potential for value creation inherent in good handling of the businesses’ own intangible assets and intellectual property rights.

3.3.4 Green competitivenessThe Paris Agreement became effective in November 2016. The main objective of the agreement is to keep global warming well below 2°C, and that the countries strive to limit the rise in temperature to 1.5°C com-pared to the pre­industrial level. This is the first legally binding climate agreement with real participation from nearly all countries. The countries have committed to report nationally defined contributions in line with the principles of progression and the highest possible ambition. All parties are encouraged to formulate and report long-term low-emission strategies.

Norway’s national goal is to become a low-emission society by 2050. This goal is enshrined in the recently adopted climate law. At the same time, in the climate

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from the CTCN, the participating countries must have established a national point of contact. The question of who should be the designated national point of contact in Norway is currently under consideration. The point of contact will be responsible for connecting Norwegian suppliers with the needs identified by the CTCN.

The instruments of the climate policy are to strengthen the incentives to develop and adopt climate friendly technology. Through joint fulfilment of the climate goals with the EU, provisions will be made for more equal terms of competition and predictability for Norwegian businesses. Norwegian businesses can contribute to the green shift by being competitive in climate friendly technology. This can be done in Norway as well as through trade in climate and environmental technology, including CO2 capture, and through international investments. A competitive Norwegian business community can also attract long-term investments and reduce the risk of carbon leakage.

Compared to other oil and gas producing countries, Norway has among the world’s lowest greenhouse gas emissions from such production. Among other things, this is due to a high CO2 tax, strict emission standards, and mandatory quotas. In addition, flaring is banned in Norway. Because of this, the Norwegian oil and gas industry has developed competence and technology for efficient oil and gas extraction. The technology base of the Norwegian supply industry is in demand globally because it contributes to profitable activity, but also because of the experience in reducing emissions from production. This competence can be valuable in the efforts to facilitate development of products contribut-ing to lower emissions in other industries as well.

Norwegian export of green solutions, and the question of whether Norway is considered attractive for

investments, will be affected by costs and the willing-ness to pay, national climate and environmental policy, as well as other framework conditions.

New investment company to help reduce emissions of greenhouse gasesThe Government is working to establish a new investment company to help reduce emissions of greenhouse gases through investments which directly or indirectly help reduce greenhouse gas emissions.

The investment company shall invest in unlisted companies and through so-called fund of funds solutions. Investments are to be made on equal terms as for private co-investors. The company shall mainly direct its investment efforts towards new technology in the transition from technol-ogy development to commercialisation, and shall give priority to low- and zero-emission solutions. The efforts are not to provide particular stimula-tion to the development of new power produc-tion in Norway, however, projects with production of renewable energy in other countries could be considered.

The company shall only invest in companies and funds operating in or from Norway, and seek to avoid being the largest owner in each investment. The company’s ownership in each investment is expected to amount to a maxi-mum of 49 per cent. Private parties shall own at least 50 per cent in companies and funds in which the investment company invests. Compa-nies wholly owned by the Government are in this context not considered to be private parties. The company shall aim at profitable investments, and shall not be able to take loans.

Snowshoe hike at Hoven, Loen. Photo: Innovation Norway

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3.4 The public support system for export and internationalisatonThe public industry-oriented government agencies manage large allocations, and shall facilitate increased value creation in the business community and in Norway as a whole.

Innovation Norway and the Research Council of Norway have broadly aligned schemes with consider-able competition for the funds. This channels the funding to projects with the largest potential for value creation and socioeconomic effects, regardless of topic, industry and geography. Export and internationalisa-tion are important to many businesses, and many of the public funding schemes therefore help promote export and internationalisation, even though the schemes do not have this as their specific purpose. Examples are Innovation Norway’s schemes, such as innovation loans, the environmental technology scheme and innovation contracts (previously called IFU/OFU contracts).

Several agencies, such as GIEK and Export Credit Norway, promote Norwegian export and investments abroad. Export Credit Norway and GIEK provide loans and guarantees respectively in connection with export on behalf of the Norwegian Government. GIEK also provides guarantees for investments abroad. Many organisations in the public support system, such as the Research Council of Norway, Innovation Norway, and Siva, mainly have schemes that do not require export and internationalisation, but international collaboration is often one of the criteria of evaluation when selecting eligible projects.

The public support system and the foreign service have international presence in many countries. The Ministry of Trade, Industry and Fisheries is responsible for Innovation Norway, which has offices in 29 countries, and for the Norwegian Seafood Council, which has offices in 12 countries. The foreign service is present in about 100 countries. In addition, Norwegian Energy Partners has 17 offices in important markets for the energy industries, and Innovation Norway and the Research Council of Norway co­finance technology delegates in partner countries in research and educa-tion. Export Credit Norway AS and Music Norway are also present in some countries important to their operations. The current offices abroad have many involved stakeholders with various goals and instru-ments. In order for the efforts to be as coordinated as possible, these stakeholders collaborate in Team Norway.

In several of the meetings giving input to the work with this strategy, the business community has emphasized that it is important that information on the various schemes and services of the public support system is clear and easily accessible to the business community. Below is an overview of the schemes and services included in the public support system for the promo-tion of export and internationalisation.11) 12)

11 There is also an overview of support schemes on the Altinn website: https://www.altinn.no/no/Starte-og-drive-bedrift/Oversikt-stotteord-ninger/.

12 The regulatory framework for export control and current sanctions against certain countries also set limits for corporate behaviour in international contexts. Please see www.eksportkontroll.no for updated information.

Norway is a unique travel destination, with a large potential to attract tourists

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Overview of instruments, schemes and programmes for export and internationalisation

The public support system for export and interna-tionalisation is defined in this context as the public policy instruments and programmes whose purpose or condition is export and internationalisation.

The business wishes to obtain:1) Financing of export and inter- nationalisation • The Norwegian Export Credit Guarantee

Agency (GIEK) supports export of capital, goods and services (giek.no). • Buyer credit guarantee – guarantee against

non-repayment of loans • Supplier credit guarantee – secures

payment for credit sales • Contract guarantee – guarantee against

loss during the production period• Bond guarantee – guarantee against

non-delivery by exporter• Letter of credit guarantee – guarantee

for money transfer • Production loan guarantee – guarantee

for loans for production costs associated with export and

• Investment guarantee – guarantee for political risk in connection with invest-ments, or loans for investments, abroad

• Export Credit Norway provides loans for export of capital goods and services (eksportkreditt.no).

2) Advice and increased competence on export and internationalisation• Innovation Norway provides various

competence and counselling services for export and internationalisation, such as:• Help make the Norwegian business

community, including the tourism industry, better known abroad, and help foreign businesses invest and establish new business, through promotion.

• International market counselling• Trade technical counselling

• Counselling on the EU and participation in Horizon 2020, including the Norwegian knowledge hub in Brussels (The Research Council of Norway, SIU and Innovation Norway)

• Competence programmes for export and internationalisation

• Counselling and communication at the foreign offices regarding inter­nationalisation

• The Research Council of Norway and Innovation Norway assist the Norwegian business community in applying for funding of international research and innovation collaboration in the European research and innovation programme Horizon2020.

• Invest in Norway – handles requests from foreign companies considering locating in Norway (invinor.no).

• Norwegian embassies and consulates (the Foreign Service) promote Norwegian business interests abroad, including cultural and creative industries, through knowledge of local conditions and extensive networking in business and cultural life. The embassies and consulates support a number of initiatives to stimulate increased export. They are also vital in implementing business programmes during state visits or official visits (norway.no).

• The Patent Office Office is the national registration authority for industrial rights, and processes applications and gives rights to patents, brands and designs for both Norwe-gian and foreign businesses. The Patent Office offers courses and provides counsel-ling in connection with application processing and rights (patentstyret.no).

• Initiatives of municipalities and county municipalities to facilitate internationalisation

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Overview of area­ and sector specific schemes for export and internationalisation

• Innovation Norway • Grants for projects for facilitating, leading

to, or containing increased business collaboration and networking between Norway and Russia (the ProRUS pro-gramme).

• Arktis 2030 – grants directed towards international business-oriented knowledge projects in the start-up phase

• Export programme for architecture (in collaboration with DogA)

• Nordic Innovation’s partial funding of projects with Nordic relevance.

• The Nordic Project Fund (NOPEF) supports the international competitiveness of Nordic SMEs through financing preliminary studies for internationalisation. (nopef.com)

• The Nordisk Environment Finance Cooperation’s (NEFCO) finances investments with environmental effect in Russia and Eastern Europe (nefco.org)

• The Barents Secretariat’s project financing for businesses participating in Nordic-Russian projects in the Barents region.

• The Ministry of Defence’s grants (market-ing support) for export promoting measures executed by Norwegian industry and the defence sector in priority technology fields for defence industry collaboration or other products and services relevant to the defence sector (more information at Regjeringen.no)

• The Norwegian Space Centre’s grants to Norwegian businesses and research communities which have, or might have, deliveries to international space related activi-ties.

• Norwegian Energy Partners (NORWEP) is a publicly funded player promoting interna-tionalisation of the Norwegian based petro-leum and renewables industry (norwep.com). NORWEP receives grants from the Ministry of Petroleum and Energy.

• The Ministry of Foreign Affairs’ grants to promote international opportunities for Norwegian cultural and creative businesses

• Norwegian Arts Abroad is a network of organisations consisting of Design and Architecture Norway (DogA), Music Norway, NORLA, Norwegian Crafts, Performing Arts Hub Norway, Office of Contemporary Arts Norway and the Norwegian Film Institute, contributing to promoting Norwegian arts and culture internationally. Design and Architecture Norway (DogA) receives funding from the Ministry of Trade, Industry and Fisheries. The other organisations in Norwe-gian Arts Abroad receive funding from the Ministry of Culture. (stikk.no)

• The organisations in Norwegian Arts Abroad manage various export promoting grants on behalf of the Ministry of Foreign Affairs, and have close contact with Norwegian foreign stations.

Norway also has two publicly owned limited companies which do not receive government grants, but work with export and internationali-sation.

• GIEK Kredittforsikring AS – a state- owned limited liability company promoting Norwegian export by insuring the credit of buyers of Norwegian export goods, with credit periods of up to two years (giekkreditt.no). GIEK Kredittforsikring operates commer-cially.

• The Norwegian Seafood Council – a state-owned limited liability company working with the Norwegian fisheries and aquaculture industry to develop markets for Norwegian seafood. (seafood.no). The seafood industry is financing the Seafood Council through a statutory tax on all export of Norwegian seafood.

• Furthermore, the Customs Administration is responsible for declaring all goods to be exported (toll.no). The Arts Council Norway has an overview of cultural objects requiring export permits, and issues export permits. Also, the Norwegian Food Safety Authority handles the issuance of certificates (mattilsynet.no).

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Corporate social responsibilityThere is currently broad consensus among the social partners, authorities, businesses and non­profit organisations that corporate social responsibility (CSR) must be part of the interna-tional activities of the business community. The Government expects Norwegian businesses to be among the foremost to demonstrate CSR, and thus contribute to innovation and value creation. The businesses must be familiar with, and utilize, the OECD Guidelines for Multi national Enterprises and the UN Guiding Principles on Business and Human Rights. The regulatory framework applies in general, but it is particularly important in challenging markets. Responsible business conduct currently means that the businesses have a policy for corporate responsibility in their own operations and value chain, that they show due diligence and consult with anyone affected by the compa-ny’s activities. Anti­corruption efforts are impor-tant in this context. Businesses must perform diligence assessments and risk assessments focusing on human rights, including the rights of indigenous peoples (cf. ILO Convention no.

As shown in the boxes above, there are many good, public instruments in Norway to help Norwegian businesses succeed in international markets, and many stakeholders and instruments are involved. In order for the business community to get the best possible assistance in the easiest possible way, it is important that the various stakeholders know when to draw in resources from other organisations.

A good example is the recently established collabora-tion between Innovation Norway, GIEK, Export Credit Norway and GIEK Kredittforsikring. In order to get their instruments and products known and easily accessible to businesses, they started a project on their own initiative called the Export Team. The purpose of the Export Team was to meet Norwegian businesses and gain insight into how the organisations can receive coordinated, and test whether businesses get added value from simultanously meeting the four organisations. The team visited in total 74 businesses located in all counties in Norway and from many different industries. The Export Team’s experiences indicate that the four organisations have a potential to provide better information about and simplify access to their instruments and products.

The Export Team has experienced that businesses can benefit from instruments they have not used before, and that many is not aware of the wide range of Norwegian public schemes. For example, the Export Team has seen the need for a common

point of contact for the instruments and the products provided by the Norwegian Government. The point of contact should as a minimum have the knowledge to refer to which instruments from other agencies that could be relevant for a business. The four organisa-tions are now considering how they can strengthen the collaboration and increase interaction between themselves to ease access to the products for which they are responsible, and thus help businesses reach new markets and obtain contracts.

Chambers of commerce Chambers of commerce in as well as outside Norway play an important role in assisting the Norwegian business community in export and internationalisation, for example with network-ing and services associated with export docu-ments. Several chambers of commerce also help foreign workers moving to Norway create a network and adapt to Norwegian society. The Ministry of Trade, Industry and Fisheries gives annual grants to the Association of Nor-wegian Chambers of Commerce13) and ICC Norway14) in order to cover their participation in international forums such as Eurochambers and International Chamber of Commerce.

13 http://www.dnhf.no/handelskammer/

14 http://www.iccnorge.no/

The steel jacket for the Johan Sverdrup platform was towed from Kværner Yard in July 2017. Photo: Kværner Verdal

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Corporate social responsibilityThere is currently broad consensus among the social partners, authorities, businesses and non­profit organisations that corporate social responsibility (CSR) must be part of the interna-tional activities of the business community. The Government expects Norwegian businesses to be among the foremost to demonstrate CSR, and thus contribute to innovation and value creation. The businesses must be familiar with, and utilize, the OECD Guidelines for Multi national Enterprises and the UN Guiding Principles on Business and Human Rights. The regulatory framework applies in general, but it is particularly important in challenging markets. Responsible business conduct currently means that the businesses have a policy for corporate responsibility in their own operations and value chain, that they show due diligence and consult with anyone affected by the compa-ny’s activities. Anti­corruption efforts are impor-tant in this context. Businesses must perform diligence assessments and risk assessments focusing on human rights, including the rights of indigenous peoples (cf. ILO Convention no.

169 and the UN Declaration on the Rights of Indigenous Peoples). It is also absolutely crucial that affected indigenous groups are consulted in connection with measures that may affect their interests or way of life. The OECD has prepared good guidelines for stakeholder dialogues in the extractive industries as well as in other fields.

Norway’s National Contact Point (NCP) promotes the OECD Guidelines for Multinational Enter-prises, and handles individual complaints of alleged breaches of the guidelines. All OECD countries are obliged to have such a non-judicial appeal mechanism. The OECD Guidelines for Multinational Enterprises describe the responsi-bilities of the national points of contact, and how they are to conduct their operations. The Norwegian point of contact is established as a professional impartial advisory body with four members. The point of contact assists Norwegian authorities in their efforts to promote the guide lines, and shall give advice and guidance in individual cases. The point of contact has a secretariat which is subject to the Ministry of Foreign Affairs.

Fishing for herring. Photo: Grethe Hillersøy/ Norway Seafood Council

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Measures

Top: Photo: ThinkstockBottom: Photo: Marine Harvest

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Measures

The current trade policy landscape provides new opportunities for Norwegian businesses to succeed in international markets. At the same time, businesses are facing an increasingly strong global competition and the start of increased protectionism. It is a goal to secure market access to existing as well as new export markets. By making Norway attractive, we wish to attract foreign investments as well as position ourselves as a leading research and innovation nation. In a time of structural adjustment, increased export from existing as well as new export industries is beneficial to the Norwegian economy. Norway is well positioned to take a leading role in the green readjust-ment efforts. The Government will continue to align the public support system and facilitate interaction between the relevant stakeholders in order to create efficient synergies and long­term results.

Export industries depend first and foremost on good, general framework conditions and a responsible economic policy that does not contribute to unneces-sary pressure on the cost level, interest rate and NOK exchange rate. The Government has identified a number of measures on the general level as well as on more specific levels, facilitating increased inter­nationalisation and export.

Trade Policy and Framework Conditions4.1. A multilateral trade policyThe multilateral trade system, primarily represented by the World Trade Organization (WTO), is a mainstay in Norwegian trade policy. In a time of increased tendencies of protectionism, and where economic growth has not been as expected, it is important to support existing institutions. The WTO helps reduce trade barriers and increase global economic growth and stability. Existing legal frameworks and practices are developed further through the WTO’s regular work. At the same time, there are efforts to develop and negotiate regulatory frameworks in new areas. It is

important to protect the WTO as an organisation based on binding, enforceable rules for international trade collaboration. This provides the best starting point for stable framework conditions for Norwegian exporters.

Multilateral agreements within the WTO or with the closest possible ties to the organisation, are important contributions to a modern trade agenda. One example is negotiations for a plurilateral agreement on environ-mental goods (EGA), which will lead to lower prices on important technology and give a positive contribu-tion to solving environmental challenges such as air pollution, water pollution and greenhouse gas emis-sions. Another relevant example is the negotiations for an agreement on trade in services (TISA), which will provide better market conditions for Norwegian export of services.

MEASURES:

• Norway’s priority is to strengthen and maintain the WTO as the mainstay of the global trade regime by actively supporting ongoing and new processes for the development of multilateral trading regulations.

• Norway participates in multilateral and plurilateral negotiations which can contribute to better framework conditions for Norwegian export interests, including the EGA and TISA negotiations.

4.2 Conclude free trade agreements with priority countriesNorway signs free trade agreements in order to secure market access and predictable framework conditions in export markets. At the same time, it is important for the Norwegian economy and business community to facilitate more import. This increases competition from abroad, and thus contributes to efficient production, a larger range of products, and lower prices. Free trade agreements reduce trade barriers and facilitate export of goods and services, investments and access to markets for public procurements. Trade agreements should also contribute to the overall goals of

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sustainable development, which include labour rights and environment. The free trade agreements consti-tute an important addition to the WTO regulations, and they secure competitive terms for Norwegian exporters. At the same time, the agreements create a forum for addressing issues and practical challenges in bilateral trade at government level. When selecting countries with which to negotiate, the emphasis is on countries that have agreements with the EU, and where Norway has special interests. Norway currently has 29 free trade agreements with 40 countries, of which 27 agreements are negotiated together with the other EFTA member countries.

The significance of trade with markets outside the EEA has increased in step with the globalisation of Norwe-gian foreign trade during the past decades. The change in the export pattern for mainland Norway is a good illustration. In 1990, 83 per cent of goods exports went from the mainland to Europe, compared to 68 per cent in 2016. At the same time, the share of goods exports to Asia increased from 7 to 18 per cent. The potential in new markets is still enormous. Our existing free trade agreements cover many important countries; however, Norway still does not have free trade agreements with six of the world’s ten largest economies. Since the share of our export that goes to countries where we do not have free trade agreements keeps increasing, it is vital that the network of agree-ments is continuously expanded. When choosing the countries with which Norway should sign trade agree-ments, the business community’s interests and needs are considered, including the ocean industries, which currently represent 70 per cent of Norwegian export.

Norway will resume the bilateral trade negotiations with China during 2017. Japan is also an important market for Norway, and we therefore wish to initiate negotiations for a bilateral trade agreement with Japan as well.

EFTA is currently negotiating bilateral trade agreements with countries in Asia, such as India, Malaysia, Vietnam and Indonesia. This reflects the fact that the central point of world’s economy has gradually shifted to the east. Negotiations with Mercosur (Argentina, Brazil, Paraguay, and Uruguay) started in June 2017, and we are also negotiating with Ecuador. At the same time, there is ongoing work to update and expand existing agreements in order to reflect the development in trade patterns and future needs. There are currently such ongoing processes with i.a. Turkey, Mexico, and Canada.

EFTA is in dialogue with the East African Community and Nigeria on declarations on cooperation with a view to negotiations. The Association of Southeast Asian Nations (ASEAN) represents a considerable market for Norway, and we wish to develop our contacts with ASEAN further.

EFTA has a trade policy dialogue with the US, and it is desirable to continue this. Since 2013, the Ministry of Trade, Industry and Fisheries has been following the negotiations between the EU and the US for a transat-lantic trade and investment partnership (TTIP). In 2016, the Ministry commissioned NUPI to investigate the consequences of TTIP and various Norwegian courses of action. The main findings of the investigation were that Norway would profit from becoming part of TTIP if such an agreement materializes, and that inde-pendently of TTIP, Norway would profit considerably from signing a trade agreement with the US.15) The TTIP negotiations were shelved in January 2017.

MEASURE:

• The Government will negotiate free trade agreements with priority countries, as well as modernize existing agreements. The agreements shall reflect the develop-ment in trade patterns and reduce tariffs and other barriers to trade.

15 https://brage.bibsys.no/xmlui/handle/11250/2420236

An international team from the classification company DNV­GL studies technical drawings before a mission to Singapore. Photo: DNV GL/Holger Martens

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4.3 A well-functioning European Single MarketNorwegian authorities will contribute to the develop-ment of the EU’s Single Market. A well-functioning Single Market creates the necessary predictability and equal terms of competition for Norwegian export businesses. The challenge is to contribute to a good regulatory development at the EU level while the approved regulatory framework is being implemented and enforced in a good way nationally. It is the authori-ties’ responsibility to remove unnecessary trade barriers and create homogeneity through an equal regulatory framework for all participants in the Single Market.

The Government’s European policy provides clear directions for the Norwegian authorities’ work with EU and EEA matters. The basis for the execution of the European policy is the EEA agreement and Norway’s other agreements with the EU. These agreements give the greatest chance of participation in policy and regulatory design in the EU at an early stage. Through early and targeted efforts, Norway shall be a contribu-tor in the further development of the European Single Market.

MEASURE:

• The Government’s European policy will be continued. Norway is to be an active and constructive contributor in the efforts to further develop the European Single Market.

The service market in the EEA is not as well developed as the commodity market. Businesses experience a greater degree of obstacles for trade in services across borders. The adoption of the Services Directive in 2006 was intended to facilitate better trade in services in the EEA. The way this regulatory framework has been incorporated into national law has consequences for

the opportunities for individual service businesses in the EEA. A study of the directive’s effects in the Nordic countries could demonstrate any inequalities in the regulatory framework and indicate whether the regulatory framework has had the intended effect. The Nordic Council of Ministers has made funds available for such an analysis in a limited area. The project includes all Nordic countries.

MEASURE:

• The Ministry of Trade, Industry and Fisheries will perform a case study of the effects of the Services Directive in the Nordic region, based on funding from the Nordic Council of Ministers

4.4 Trade policy collaboration with the EU and Great Britain after BrexitThe EU and Great Britain will continue to be important trade partners for Norway in the future. Working closely with the EU bodies and British authorities is therefore crucial in order to secure good solutions for the Norwegian business community in connection with Great Britain’s exit from the EU.

Great Britain’s decision to leave the EU, Brexit, will lead to changes in the trade policy framework between Great Britain, the EU, and Norway. This may have consequences for value creation in Norway and in our most important and closest markets. It is therefore in Norway’s interest that we are included in discussions of common solutions between the EU and Great Britain in areas affecting the Single Market.

For the Norwegian business community, it is important that there is no contractual void after Great Britain’s exit from the EEA. It will therefore be necessary to ensure that temporary or permanent arrangements for trade between Norway and Great Britain are in place from the start. It is in Norway’s interest to

The EEA agreement has been and is important for the progress in Norway’s economy, industry and foreign trade

EFTA is currently negotiating bilateral trade agreements with countries in Asia, such as India, Malaysia, Vietnam and Indonesia. This reflects the fact that the central point of world’s economy has gradually shifted to the east. Negotiations with Mercosur (Argentina, Brazil, Paraguay, and Uruguay) started in June 2017, and we are also negotiating with Ecuador. At the same time, there is ongoing work to update and expand existing agreements in order to reflect the development in trade patterns and future needs. There are currently such ongoing processes with i.a. Turkey, Mexico, and Canada.

EFTA is in dialogue with the East African Community and Nigeria on declarations on cooperation with a view to negotiations. The Association of Southeast Asian Nations (ASEAN) represents a considerable market for Norway, and we wish to develop our contacts with ASEAN further.

EFTA has a trade policy dialogue with the US, and it is desirable to continue this. Since 2013, the Ministry of Trade, Industry and Fisheries has been following the negotiations between the EU and the US for a transat-lantic trade and investment partnership (TTIP). In 2016, the Ministry commissioned NUPI to investigate the consequences of TTIP and various Norwegian courses of action. The main findings of the investigation were that Norway would profit from becoming part of TTIP if such an agreement materializes, and that inde-pendently of TTIP, Norway would profit considerably from signing a trade agreement with the US.15) The TTIP negotiations were shelved in January 2017.

MEASURE:

• The Government will negotiate free trade agreements with priority countries, as well as modernize existing agreements. The agreements shall reflect the develop-ment in trade patterns and reduce tariffs and other barriers to trade.

15 https://brage.bibsys.no/xmlui/handle/11250/2420236

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maintain the best possible trade policy collaboration with Great Britain, as well as the best possible access to the British market. On the Norwegian side, it is desira-ble to improve market access for seafood, which is not subject to zero tariffs through the EEA agreement.

MEASURES:

• A close dialogue has been established with relevant EU bodies on the parts of the negotiations which affect the EEA collaboration and other relevant areas, including possible transitional arrangements.

• A trade policy dialogue has been established between Norway and Great Britain at government level.

• A special envoy has been appointed with responsibility for industrial and fisheries issues at the Norwegian embassy in London. The special envoy shall safeguard and further develop relations with British authorities in matters of trade and industry collaboration and fisheries management.

4.5 Sign bilateral investment agreements with important marketsNorway will sign investment agreements in order to help reduce the risk for businesses in emerging markets with unpredictable framework conditions. The goal is to protect Norwegian investments abroad and ensure that Norwegian businesses can compete on equal terms with businesses from other countries, especially in countries where the political situation is unstable. Many companies hesitate to invest in emerg-ing markets due to unpredictable framework condi-tions. The agreements shall also promote investments in developing countries and contribute to economic growth in these countries. Norway has not signed any investment agreements since the mid-1990s. There have been many attempts to safeguard the various

defensible interests opposing each other in such agreements, namely the investors’ need for protection and the states’ right to regulate on their own territory. The Government submitted a proposal for a model agreement for investment agreements for public consultation a while ago, and there are ongoing efforts to follow up on this so that Norway can sign investment agreements again. The overall goal is to reach a solution which safeguards both the business community’s need for protection when investing abroad and the host country’s right to legitimate exercise of authority.

MEASURE:

• The Government will establish a mandate to conclude agreements on the promotion and protection of investments abroad (investment agreements). These shall safeguard the business community’s need for protection when investing abroad as well as the host country’s right to legitimate exercise of authority.

4.6 Negotiate international agreements for officially supported export creditsNorwegian exporters should compete on a level playing field with their global competitors. More capital requirements for private banks means that export credit agencies are getting an increasingly prominent role, especially in emerging markets. Many countries do not participate in the current agreement regulating officially supported export credits. Some countries therefore give more favourable terms for export credits than others. This may lead to an unfavorable distortion of competition. A new agreement is therefore needed to regulate officially supported export credits with more countries, and negotiations on this have been going on for a few years based on initiative from China and the US in 2012. At the same time, it is important to further develop today’s system of agreements and

An open trade policy with few barriers for imports and foreign investments has served Norway well

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adapt them to needs arising from development in the industry, the private financing market, or in countries outside the OECD offering export credits.

MEASURE:

• The Government gives priority to participation in negotiations on a new international agreement on officially supported export credits, as well as to further developing today’s system of agreements in order to facilitate a level playing field for Norwegian exporters, but also to limit subsidy competition between countries.

4.7 Contribute to long-term and stable framework conditions for the ocean industriesIn 2017, the Government presented its ocean strategy, aiming at promoting sustainable value creation and employment in the ocean industries. The initiatives of the strategy shall facilitate growth in the established ocean industries, the development of new industries, and, not least, the utilisation of sector­specific know­ledge across industries through closer collaboration.

4.7.1 Maintain long-term and stable framework conditions for the petroleum industry.Norway will continue to be a leading global exporter of oil and gas. Oil and gas export is Norway’s largest export industry, representing about 37 per cent of the total export. In 2016 this constituted about 350 billion NOK. Oil is a global commodity. The gas market has, for its part, historically consisted of various regional markets. About 95 per cent of Norwegian gas is trans-ported via pipelines to countries in Europe. Only a fraction of the gas volume is used domestically. In addition to crude oil, LNG, and condensate, Norway is a large exporter of petroleum related goods and services. Norway is the world’s third largest exporter

of gas. In 2016, Norway exported about 115 billion standard cubic meters of gas, mainly to Europe. This is the highest figure for gas export from the Norwegian continental shelf ever. In Europe, gas is an important source of energy for heating houses, as an input factor in industry, and in gas powered plants to generate electricity. Gas from Norway covers nearly 25 per cent of the total European gas consumption, and thus is important for the European energy security. Most of the gas delivered to Europe is sold to Germany, Great Britain, Belgium, and France, where Norwegian gas constitutes between 20 and 40 per cent of the total consumption. In many countries gas will also over time play an important part in the transition from coal to cleaner energy production. The amount of energy in the gas volume produced on the Norwegian continental shelf corresponds to about ten times the average Norwegian electricity production. Only one third of the anticipated Norwegian gas resources have been exploited so far. Production is expected to remain at a high level for decades to come.

Development of the resources on the Norwegian continental shelf creates demand for goods and services provided by, among others, the Norwegian supply industry. Requests for goods and services to the operations on the Norwegian continental shelf make it one of the world’s largest offshore markets today. The supply industry knows this market well. The Norwegian supply industry has also acquired a strong position internationally, and is world leading in areas such as seismology, subsea production systems, drilling equipment and service vessels. When this industry wins contracts, it contributes to employment. The world will still have a huge need for oil and gas in the foreseeable future. In such a scenario, in which the Paris agreement is also to be followed up, the Norwegian petroleum industry will be well positioned and competitive.

Photo: Marine Harvest

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• Work actively to ensure that the industry has a competitive regulatory framework and is given access to international markets

• Work to turn good Norwegian solutions into international standards

4.7.3 Ensure long-term and stable framework conditions for the seafood industryThe Norwegian seafood industry is currently Norway’s second largest export industry, and represents 23 per cent of the mainland export. In 2016, Norway exported 2.4 million tonnes of seafood to 146 countries and to a value of more than 90 billion NOK. This corresponds to 34 million seafood meals every day. Two thirds of the export, measured in value, went to the EU. A growing number of markets want Norwegian seafood, and Norwegian authorities and the seafood industry have ambitious goals to increase production in order to increase the supply of seafood, but also to be a greater mainstay for the Norwegian society. The production of seafood is currently one of our largest and most international industries, and it is totally dependent on being able to export about 95 per cent of its total production. In order for Norway to continue to take market shares in the global seafood market, market access and good trade conditions are vital.

MEASURES:

• Contribute to long-term and stable framework condi-tions for the seafood industry and strive to limit the increasing scope of veterinary and technical trade barriers, while safeguarding environmental and sustainability considerations

• Contribute to competitive terms for Norwegian seafood in export markets by negotiating new free trade agreements and updating the existing ones

MEASURES:

• Maintain long-term and stable framework conditions for the petroleum industry.

• Strive to ensure that Norwegian gas maintains its considerable market share of the EU’s energy mix in the future.

• Continue to support internationalisation of the oil and gas supply industry.

4.7.2 Work for long-term and stable framework conditions for the maritime industryNorway has a leading global maritime industry with competitive businesses within the full scope of the maritime industry spectrum.

Shipping is by nature global, and it is directly influenced by international trends and global development. Shipping carries about 80–90 per cent of the volume of all internationally transported goods. The most important destination countries for Norwegian ship-ping companies are, in addition to European countries, the US, Brazil, China, and Australia. Norway is the world’s 7th largest shipping nation.16) Shipping also needs good framework conditions. In 2015, gross freight from international shipping constituted 7.2 per cent of the total Norwegian export of goods, and 25 per cent of the export of services.

Norwegian maritime equipment and service providers are internationally oriented businesses which are world leading in ship design, ship insurance and brokerage, marine paint, navigation equipment, propellers, and classification. The direct export of Norwegian equip-

16 Measured in the number of vessels (UNCTAD)

ment manufacturers accounted for more than 60 per cent of the revenues in 2016.

The export value of the maritime industry in 2013 was estimated to be around 233 billion NOK. The maritime industry is among Norway’s most important export industries.17)

Access to the export markets is vital to the Norwegian maritime cluster. The large shipbuilding countries such as China, Korea, Singapore, Brazil, and Japan are of particular importance. The clients of maritime equip-ment providers are shipyards building vessels and rigs/floating installations for oil production.

The Norwegian maritime industry is among the world’s most innovative, and it is at the forefront in producing environmentally and climate friendly vessels, equip-ment, as well as autonomous solutions. The maritime industries have been, are and will be important to the development and value creation in the ocean indus-tries as providers of goods, services and competence.

Norwegian authorities conduct active dialogues with the authorities of several countries where the Norwe-gian maritime industries have considerable interests. Norway negotiates bilateral shipping agreements with countries where we have specific interests to protect.

MEASURES:

• Work in international fora for a unified global regula-tory framework for the industry, open markets, high requirements for maritime safety, environment, and social standards

17 Maritim Forum, «Maritim verdiskapingsbok 2017», There is some uncertainty associated with the export figures due to how the industry and the export are defined, and thus uncertainty with regard to the underlying data

Statoil – Mariner A. Photo: Jamie Baikie/Statoil

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• Work actively to ensure that the industry has a competitive regulatory framework and is given access to international markets

• Work to turn good Norwegian solutions into international standards

4.7.3 Ensure long-term and stable framework conditions for the seafood industryThe Norwegian seafood industry is currently Norway’s second largest export industry, and represents 23 per cent of the mainland export. In 2016, Norway exported 2.4 million tonnes of seafood to 146 countries and to a value of more than 90 billion NOK. This corresponds to 34 million seafood meals every day. Two thirds of the export, measured in value, went to the EU. A growing number of markets want Norwegian seafood, and Norwegian authorities and the seafood industry have ambitious goals to increase production in order to increase the supply of seafood, but also to be a greater mainstay for the Norwegian society. The production of seafood is currently one of our largest and most international industries, and it is totally dependent on being able to export about 95 per cent of its total production. In order for Norway to continue to take market shares in the global seafood market, market access and good trade conditions are vital.

MEASURES:

• Contribute to long-term and stable framework condi-tions for the seafood industry and strive to limit the increasing scope of veterinary and technical trade barriers, while safeguarding environmental and sustainability considerations

• Contribute to competitive terms for Norwegian seafood in export markets by negotiating new free trade agreements and updating the existing ones

• Strengthen the international regulatory framework for trade by following up ongoing WTO processes

4.8 Increased export of Norwegian agricultural productsNorwegian agricultural products generally have a competitive advantage since the products maintain a high level with regard to food safety, animal health, and the use of pesticides. Many products also have qualities and characteristics that can be used more actively when marketing the products in an interna-tional market. One example is Kraftkar from Ting­vollost, which was named the world’s best cheese in 2016 in the world’s largest cheese competition, World Cheese Awards.

However, the products have a challenge with regard to price, which can be considerably higher than the prices one find in the export markets. Also, agricultural production is mainly directed towards the domestic market. There could therefore be small volumes for export. Long distance from producer to market could also make it difficult to sell goods such as fresh produce. The Ministry of Agriculture and Food has published a strategy for export of agricultural products where this was one of the topics.18)

Norwegian export of agricultural goods shall have continued growth. The export of agricultural goods amounted to around 10 billion NOK in 2016. During the past years, export has increased by about 10 per cent annually. Therefore, in new negotiations as well as renegotiations of trade agreements, Norway shall work for better market access for agricultural goods of particular interest. Also, we must work for trade partners to follow international obligations, in particu-lar veterinary and plant health provisions. Together

18 https://www.regjeringen.no/contentassets/99441f365ea04fd-b9038e3c5f91c52c8/eksportstrategi-for-jordbruksproduk-ter-15012015.pdf

Kraftkar, the blue cheese made by Tingvollost, was awarded best cheese in the world at the World Cheese Awards in 2016 Photo: Per Kvalvik/Tingvollost

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with the Norwegian Food Safety Authority we will work for a faster preparation of documents associated with veterinary and plant health issues, and that increased export of Norwegian agricultural products is facilitated.

MEASURES:

• Measures will be taken to ensure that Norwegian agricultural products of high quality can be exported to countries where one finds markets willing to pay a good price.

• Companies with export potential in agricultural goods are to be involved on equal terms with other compa-nies when planning business delegations.

• In trade negotiations, we will work for better market access for agricultural products of particular interest for export, and secure that veterinary and plant health requirements are in line with international regulations. On our side we will work with the Norwegian Food Safety Authority to have documents associated with veterinary and plant health requirements prepared as soon as possible.

4.9 Secure a regulatory framework for export of Norwegian military equipmentNorway shall have an internationally competitive defence industry. This helps safeguard vital national safety interests. The Norwegian defence industry’s capacity within important technological competence fields is vital to secure the correct material and compe-tence for the defence sector. This increases our ability to safeguard national safety interests in areas where conditions specific to Norway require special competence.

The international market for defence material is characterized by national markets with strong political control, protectionism, and limited market access for foreign competitors. For the Norwegian defence industry, it is the sum of national and international framework conditions that is crucial to its ability to develop competitiveness and to succeed inter-nationally.

The Government will maintain and further develop a competitive Norwegian defence industry, and strive for Norway to contribute to the establish ment of a joint European defence and security market within the framework of the EU directive for defence and security procurements. At the same time, the implementation of the directive in other countries will be monitored closely, and we will use the directive in such a way that the Norwegian defence industry is secured the same framework conditions and rules as the EU countries.

MEASURE:

• The Government will strive to establish clear and predictable framework conditions contributing to continued development of a competitive Norwegian defence industry in line with the Government’s defence industry strategy, as presented in white paper no. 9 (2015–2016).

4.10 A profitable and sustainable tourism industry Tourism is growing rapidly, both globally and nation-ally. The Norwegian tourism industry is now seeing strong increase in the number of tourists, particularly from abroad. In Meld. St. 19 (2016–2017) Opplev Norge – unikt og eventyrlig (“Experience Norway – unique and adventurous”) the Government explains the opportunities and challenges of Norwegian tourism, and presents its policy for the tourism industry. The Government wants Norwegian tourism businesses

The 7th Room in Northern Sweden. This hotel situated 10 metres above ground was designed by Snøhetta. Photo: Snøhetta/MIR

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to utilize the increased market potential in a profitable and sustainable way in the future as well.

The Government will support the positive development by ensuring good general framework conditions for the Norwegian business community, make sure sustaina­bility forms the basis for further development of the tourism industry, work for stronger coordination of the industry and relevant stakeholders such as the culture industry, evaluate the profiling of Norway as a tourist destination and continue specific research on tourism.

4.11 A modern and efficient transport systemAs stated in Meld. St. 33 (2016–2017) on the National Transport Plan 2018 ­ 2029, one of the Government’s main goals is to “...improve navigability for people and goods all over the country.”

Competitiveness, value creation, and a continued high level of welfare require a modern and efficient trans-port system. The Government will therefore with the National Transport Plan 2018 – 2029 keep a stronger focus on transport than before. The planning period of the National Transport Plan is extended from ten to twelve years. The Government has also initiated a number of necessary reforms in the transport sector, which will be carried through. This will give a more efficient and modern transport system.

Continued growth in goods transport is expected also in the years to come. The Norwegian business commu-nity has long distances to international markets, and a more efficient Norwegian transport sector will be vital in securing the competitiveness of the Norwegian business community. One of the Government’s interim goals in the National Transport Plan (cf. chapter 5.2 of the National Transport Plan) is therefore to reduce transport costs for goods transport, and thus facilitate more efficient transport.

The Government has in the National Transport Plan prioritised considerable resources to streamline goods transport and facilitate a transition in a more environ-mentally friendly direction. A 18 billion NOK allocation to the rail sector is proposed for the planning period, particularly directed towards goods transport. In order to strengthen maritime transport, a subsidy scheme for the transfer of goods, a subsidy scheme for investment in efficient and environmentally friendly ports, and subsidies for port collaboration, are prioritized. These initiatives constitute a total of 3.7 billion NOK in the planning period. There is also great focus on improved traffic flow in the road network, which can contribute significantly to more efficient goods transport.

In the National Transport Plan (cf. chapter 3.3) there is also a proposal for a separate innovation initiative of 1 billion NOK in new technology. This initiative is an addition to what is to be done by the entities under the Ministry of Transport and Communications. The initiative will take place through the new Pilot-T scheme, as well as through the competition Smarter Transport in Norway. Funds for a pilot programme for an alternative core network will also be prioritised in order to ensure robust electronic communication services. The new initiative shall facilitate the testing of new technology which could contribute to better navigability, a better environment, and reductions in greenhouse gas emissions. The scheme will also give the Norwegian business community the opportunity to participate in the development of new and modern solutions with a potential for export.

Seafood that is exported from Norway is often trans-ported on trucks before it is transported by air from airports in our neighbouring countries. Avinor is currently working to establish a new seafood terminal at Oslo Airport, in cooperation with Norwegian seafood exporters. This will create better domestic conditions for the export of seafood.

Freight train at Saltfjellet. Photo: Neel Bechtinger/Cargonet

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4.12 Facilitating direct flight routes to Norwegian airportsThe authorities shall facilitate relevant flight routes serving export and import of goods as well as passen-ger transport. Norway has become a popular and exotic tourist destination for an increasing and affluent middle class from East and Southeast Asia, particularly China. We already see a considerable rise in the number of Chinese tourists to Norway, and the interest is expected to rise further. Since the political relations between Norway and China are normalized, the seafood industry has great expectations to improved market access for export of seafood to China. Air freight of sea food helps improve the profitability of passenger routes. Therefore, the transport of seafood enables more long-distance routes for passengers from Norway. There is also great demand for direct routes between East Asia and Norway. Avinor strives to promote Norwegian airports as attractive partners, and has, among other things, recently had meetings with Japanese and Chinese airlines on this topic.

While there are ongoing efforts to attract foreign airlines to fly to and from Norway, one is also negotiating aviation agreements to secure better access for Norwegian airlines to fly over Siberia to destinations in Asia.

MEASURE:

• Through aviation negotiations, the Government will work for better access for Norwegian airlines to fly over Siberia to destinations in Asia.

An Attractive Norway and Businesses Succeeding in International Markets4.13 A competitive official export credit program In the future, an increasing share of Norwegian export is expected to go to new markets and countries where local banks usually have a lower rating than in the markets to which Norway have traditionally exported. It is a prerequisite that a guarantee is provided from financial institutions with a minimum rating equal to BBB (or that the loan is hedged with a cash deposit), for Norwegian businesses to obtain loans from Export Credit Norway. With the current minimum rating requirement and more applications in new markets, it is difficult for Export Credit Norway to find local banks that can provide guarantees. If the requirement is changed so that Export Credit Norway can obtain guarantees from banks with ratings equal to BB or above instead of BBB, this could lead to more loans from Export Credit Norway to businesses with projects in developing countries. This will not to any significance affect credit risk, and the annual maximum expected loss for Export Credit Norway is not changed. With this change, more projects could be implemented for sectors such as renewable energy, which contribute to structural adjustments. The Government will therefore enable Export Credit Norway to use guarantors with a somewhat lower credit rating than today, to a limited extent. The minimum rating will be changed to BB. The total exposure against guarantors with a lower credit rating shall not be higher than 300 million NOK, and one single institution cannot guarantee for more than a maximum of 25 per cent of 300 NOK.

There are many different instruments and financing schemes in official export credit programs from other countries, and these are in continuous development.

Oslo Airport. Photo: Avinor

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This affects the Norwegian program of officially supported export credits. The Government wants a level playing field between Norwegian businesses and exporters from other countries with similar schemes. The Norwegian export-oriented business community is in constant development, and industries, processes, and products are changing. Based on this, the Government has in 2017 already made several changes to the Norwegian program of officially supported export credits, such as enabling GIEK and Export Credit Norway to offer export credits to Norwe-gian buyers of ocean netpens and krill fishing vessels. The Government has also expanded GIEK’s export guarantees under the General guarantee scheme to include lender guarantees on market terms for export related investments in Norway. Guarantees can be issued for loans to be used for investments in for example production facilities, machinery and equip-ment in Norway. It is a requirement that the invest-ments shall trigger export, the investment being directly or indirectly export related. The scheme will give banks incentives to participate in financing industrial projects.

Also, in 2017, GIEK has established a new guarantee product for production loans covering the need for financing when a Norwegian business wants to produce goods and/or services associated with an export contract. Production loan guarantees have been requested by Norwegian exporters in later years. The product is particularly relevant to the mainland industries, and may contribute to structural adjustment.

In order to examine more closely how the official export credit program works, the Government will perform an evaluation of GIEK and Export Credit Norway. The topics of the evaluation will be to examine GIEK’s and Export Credit Norway’s achievement of objectives, and whether resources are used efficiently.

It will also examine whether the official export credit programs as a whole are working well, both the collaboration between GIEK and Export Credit Norway and their interfaces with Innovation Norway and other relevant parties. The evaluation has been put out to tender, and the Ministry of Trade, Industry and Fisheries has signed a contract with Oslo Economics, which has started the evaluation. The evaluation will be ready by the end of the year.

MEASURES:

• Export Credit Norway will be enabled to use guarantors with a somewhat lower credit rating than today, to a limited extent. The minimum requirement will be changed to BB. The total exposure against guarantors with this credit rating shall not be higher than 300 million kroner, and one single institution cannot guarantee for more than a maximum of 25 per cent of 300 NOK.

• The Government will secure a competitive official export credit program, promoting Norwegian export and investments abroad.

4.14 Establish a global growth programme in Innovation NorwayNorwegian businesses should have relevant and sufficient internationalisation competence in order to succeed in international markets. The businesses depend on clients abroad in order to export, however, internationalisation is a costly, complex and risky process. Innovation Norway sees that many Norwegian growth companies can offer better products and services than their foreign competitors in many areas, however, the lack of competence and experience in internationalisation make some Norwegian businesses unattractive partners and suppliers for international companies. This means that businesses often are

Oslo Stock Exchange. Photo: Innovation Norway

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unable to establish client relations abroad although the products and services offered are good enough.

In the Government’s white paper no. 27 (2016–2017) ”A greener, smarter and more innovative industry”, the Government reported that it was considering the establishment of a global growth programme in the export strategy in order to increase Norwegian export by giving Norwegian growth companies competence in how to acquire international market shares. In 2017 Innovation Norway has established a pilot project, and the experience from this project forms the basis for proposing that the programme is scaled up. The programme is built on Innovation Norway’s experi-ences from the global entrepreneurship programme FRAM, and will be a joint service to groups of selected growth companies. The programme can be adapted to all sectors. and will be important for sectors such as the consumer and retail goods industry, the health-care industry and the ocean industries. A programme for the healthcare industry has been completed in the pilot phase. In the programme, competence develop-ment will first be implemented in Norway, before it will be connected to leading centers of competence internationally. Participants will get international exposure, early dialogue with relevant client groups, competence in networking and branding, as well as international business development. It is important that SMEs get information about the programme and the opportunities it offers.

MEASURE:

• Innovation Norway will establish a global growth programme

4.15 Strengthen Invest in NorwayNorway is to be an attractive host country for interna-tional investors and entrepreneurs. The development of Innovation Norway’s Invest in Norway function is to help put Norway on the map as an attractive country for international investors and entrepreneurs. Invest in Norway was established in 2013. The function handles requests from foreign companies considering locating to Norway, and facilitates a more systematic and professional handling of this type of requests. Invest in Norway works with other policy instrument adminis-trators and regional stakeholders, and focuses on areas where the function can be causative in the efforts to make value creating, foreign businesses establish themselves in Norway. Invest in Norway has good knowledge and overview of Norwegian industry, research and business communities/clusters, and offers competence, a broad network and an extensive range of services. Invest in Norway has created a website (www.invinor.no) with information on its services as well as facts about the Norwegian business community and Norwegian framework conditions.

Nearly all comparable countries have an organisation working to facilitate foreign investments, with various instruments, budgets and levels of ambition. In most countries, the focus is on actively attracting foreign investments to the country.

MEASURES:

• The Government will strengthen Invest in Norway in order to attract foreign investments in Norway and make Norway a more attractive country for invest-ments.

• As part of the development of Invest in Norway, a study of how Norway could be better at attracting foreign investments and competence will be carried out.

Photo: Innovation Norway

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4.16 Strengthen the development of the cluster policyNorway has strong cluster communities. Many Nor-wegian businesses are small, and on their own they might lack research capacity, networks, experience, and contacts enabling them to compete internationally. The clusters can work as arenas for collaboration and competition enabling the businesses to compete in the global market with expert knowledge and world -leading technology. In many contexts, larger companies can play an important part as locomotives for smaller businesses in international markets and value chains. The cluster programme under the auspices of Innova-tion Norway, Siva and the Research Council of Norway, is to help reinforce the innovation in regional innova-tion communities through increased interaction and collaboration in the business community as well as between the business community, knowledge commu-nities, and agents of public development. The pro-gramme has three levels: Arena contains clusters of newly established and/or immature collaboration initia-tives. Norwegian Centres of Expertise (NCE) contains clusters with an established organisation with well- developed services, partners and achieved results from collaboration projects. Global Centres of Expertise (GCE) are to contribute to increased value creation and give businesses a better position and make them more attractive in global value chains.

Norway currently has three GCE clusters which are able to prove themselves world leaders in their fields. GCE Blue Maritime in Møre consists of more than 210 businesses designing, building, equipping and operat-ing advanced vessels for the global oil industry. GCE Subsea in the Bergen region consists of more than 100 businesses developing and delivering competence and technology for installation, operation and maintenance of subsea installations worldwide. The cluster has one of the world’s strongest academic communities in subsea technology. GCE Node in Southern Norway

has almost 60 businesses developing and delivering technology and systems for offshore drilling and platform operations in the oil and gas sector worldwide.

The clusters facilitate the transfer of competence from large to small businesses, and contribute to structural adjustment by sharing competence, networks and technology. The Government has strengthened the attention on clusters in order to promote structural adjustment in the business community. In the Govern-ment’s white paper no. 27 (2016–2017) ”A greener, smarter and more innovative industry”, the Govern-ment reports that it will further develop the current cluster policy.

MEASURE:

• The Government will strengthen the development of the current cluster policy.

4.17 Marketing of Norwegian green solutionsNorwegian businesses are well positioned to take part in the rapidly growing world markets for solutions contributing to low emissions and sustainability. This applies to areas such as the maritime sector, energy, aquaculture and the marine sector, bioecon-omy, material technology, smart buildings and circular solutions. The Government wishes to highlight Nor-wegian green solutions to increase export and attract international investors to Norway. Innovation Norway has been tasked with establishing collaboration with the Norwegian business community for this purpose. The goal is to create an arena for better interaction, communication and marketing which could lead to increased export of Norwegian green solutions. The development and operation of an interaction platform will be an important tool for achieving this.

Photo: Startup-lab

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Value creation along a value chain is distributed differently from physical production. The OECD has gone some way in mapping these conditions at an overall level, however, there are many areas where we still know less than desirable.

There is a need for better understanding of Norwegian businesses’ participation, opportunities and vulnera­bility in global value chains for production and trade. Such knowledge is important, for example for policy making.

MEASURE:

• The Government will initiate a research project in order to strengthen the knowledge and understanding of Norway’s role in global value chains.

4.21 Continue the focus on research for increased competitiveness and new export markets Investments in research and technology development are vital in order to strengthen Norway’s international competitiveness in key industries and to benefit from new export opportunities. Norway is among the world’s largest exporters of oil and gas, and we are one of the world’s largest and most advanced shipping nations. We are also the world’s second largest exporter of seafood. Furthermore, we have a world class supply industry. The oil and gas sector plus the maritime and marine industries collectively represent about 70 per cent of Norway’s total export income. The Norwegian ocean industries are very export oriented, and they operate in a global market where there is strong competition for market shares and assignments. The success and opportunities of the ocean industries internationally are of great importance to Norway’s prosperity and growth. The OECD estimates that ocean industries can double their contribution to the global economy by 2030. This constitutes a wide scope of opportunities for Norwegian ocean industries.

The initiative has been inspired by the Danish State of Green – a public-private collaboration established in 2009 in order to promote, disseminate information and build a brand around Danish climate and environ-mental solutions. The goal is increased export and facilitating collaboration between Danish businesses developing and selling climate and environmental solutions. In order to succeed, we depend on good collaboration between policy instrument administra-tors and the business community. The business community will therefore be invited to participate in the design as well as the further financing of the scheme.

MEASURE:

• Innovation Norway establishes collaboration with the Norwegian business community for marketing of Norwegian green solutions.

4.18 Collaboration and coordination between government and regional and municipal stakeholdersThrough the municipal and regional reform, municipali-ties and regions will become larger. County municipali-ties will have, and assume, a clearer role in community development – for example through clearer coordina-tion and collaboration with the Government. This includes efforts to develop an adaptable business communities in all parts of the country. Several county municipalities and municipalities currently have an international involvement where they act as door openers for the business community in the county. The county municipalities consider international involvement as part as their work as regional commu-nity developers. This applies to everything from enabling the business community and employees locally and regionally, to transport and communica-tions, education, and promoting their own county or municipality in foreign markets. The county munici-palities are also partial owners of Innovation Norway,

and play an active part in mobilizing the business community in developing a stronger international competitiveness. Through a greater degree of coordi-nation with government efforts, as well as the exchange of information on trends in various parts of the country, Norwegian efforts to promote export will be better coordinated and yield a greater effect of the collective effort.

MEASURE:

• The Government and the county municipalities will work for a good exchange of information, coordination and collaboration to promote export and internation-alisation through appropriate meeting places.

4.19 Export of research servicesNorway participates in an extensive international research collaboration, which can also include the sale of research services to contractors abroad. Relevant buyers of Norwegian research services could be foreign companies as well as foreign authorities. Such export of services helps strengthen the competence and increase profits in Norwegian research communities. This could further contribute to the transfer of know- ledge, better collaboration between Norwegian and foreign businesses, and strengthen the Norwegian businesses’ understanding of the international market.

MEASURE:

• The Government will continue to facilitate export of research services.

4.20 Strengthen the knowledge base on Norway’s role in global value chains for production and tradeWe have seen increasing specialisation in the business community for decades. The end product is no longer manufactured at one production facility and sold

Photo: Innovation Norway (IN)

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to close customers. Most goods and services traded internationally are currently the result of a long international value chain with intermediate goods from, and production in, several countries.

In total, intermediate goods and services constitute more than 66 per cent of the final value of the goods and 70 per cent of the values traded in the world (OECD 2013). Such globalisation is driven by many changes, including reduced trade barriers, lower transport costs, increased labour mobility, fewer restrictions on capital mobility and technology development.

In the Official Norwegian Report NoU 2013:13, the Holden III committee, it is pointed out that an increas-ing number of Norwegian industries are integrated in the international exchange of goods and services and face international competition. In the Official Norwe-gian Report NOU 2015:1, The Productivity Commission argues that in the long run, Norway may depend on adjusting the economy towards more combined and complex value chains.

Increased globalisation, with value chains across borders, means that Norwegian business do not have to invest in Norway to expand production. With participation in international value chains, further growth does not have to require the establishment of businesses in other countries.

With more and longer value chains, international networks, connections and knowledge transfer will become increasingly important. The Productivity Commission emphasizes that the consequence of Norwegian businesses’ limited participation in inter-national value chains could be that technology devel-opment, market signals and new knowledge arrives late or requires more efforts than in other countries.

Value creation along a value chain is distributed differently from physical production. The OECD has gone some way in mapping these conditions at an overall level, however, there are many areas where we still know less than desirable.

There is a need for better understanding of Norwegian businesses’ participation, opportunities and vulnera­bility in global value chains for production and trade. Such knowledge is important, for example for policy making.

MEASURE:

• The Government will initiate a research project in order to strengthen the knowledge and understanding of Norway’s role in global value chains.

4.21 Continue the focus on research for increased competitiveness and new export markets Investments in research and technology development are vital in order to strengthen Norway’s international competitiveness in key industries and to benefit from new export opportunities. Norway is among the world’s largest exporters of oil and gas, and we are one of the world’s largest and most advanced shipping nations. We are also the world’s second largest exporter of seafood. Furthermore, we have a world class supply industry. The oil and gas sector plus the maritime and marine industries collectively represent about 70 per cent of Norway’s total export income. The Norwegian ocean industries are very export oriented, and they operate in a global market where there is strong competition for market shares and assignments. The success and opportunities of the ocean industries internationally are of great importance to Norway’s prosperity and growth. The OECD estimates that ocean industries can double their contribution to the global economy by 2030. This constitutes a wide scope of opportunities for Norwegian ocean industries.

Norway shall be an attractive host nation for international investors and entrepreneurs

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Innovation Norway, the Research Council of Norway and SIU have a joint responsibility for operationalizing measures and activities connecting higher education, research and innovation, and for evaluating relevant measures and forms of collaboration.

The Government will enable Innovation Norway, the Research Council of Norway and SIU to develop their collaboration on higher education, research and innovation with strategically important countries further.

MEASURE:

• Facilitate further development of flexible instruments for international collaboration with strategically important countries, focusing on the connection between education, research, and innovation.

4.23 Increased industry and innovation collaboration in the Nordic regionThe Nordic governments have ambitions for the Nordic region to be the world’s most integrated region. In this, there is agreement on the importance of combating cross-border barriers between the Nordic countries. The Nordic Freedom of Movement Council was estab-lished in 2014 in order to remove cross-border barriers inhibiting mobility, free movement and value creation for individuals as well as businesses, and to prevent new cross-border barriers. The Nordic countries agree that a complete dismantling of cross-border barriers is neither realistic nor desirable, since the Nordic countries have different laws and regulations; however, it is just as important to be aware of the differences as to remove them. Efforts have also been initiated to evaluate trade barriers between Norway and Sweden. Trade between Norway and Sweden is extensive, and we are each other’s largest export market. In 2016, the Swedish Kommers kollegium presented a report where Norway is highlighted as the country where Swedish

In the coming years, global markets will be more characterized by climate regulations, and the demand for renewable energy and low-emission technology and products will increase. Norway has strong research communities, large natural resources and long industrial traditions which provide opportunities for increased value creation in global markets espe-cially within environmentally friendly energy. Norway has also been a pioneer in regulating emissions to the environment, and during the last decades, the Norwe-gian business community has had increased focus on how to reduce environmentally harmful emissions. Norwegian businesses have also been able to utilize their competence in order to maintain their production in challenging and partially vulnerable natural environ-ments. This has made it possible to sell environmental products internationally. Norwegian businesses have also, to a considerable extent, seen the possi bilities in delivering solutions based on Norwegian competence to environmental projects worldwide. These factors could give Norwegian businesses an advantage in a world that increasingly puts a price on greenhouse gas emissions. The development of new climate and environmental solutions will also be affected by technology development, and may receive important contributions from the emergence of enabling techno-logies, digitisation and methods that contribute to increased reuse of materials and waste in the econ-omy. Also, the bio based industries are, through sustainable production and processing of renewable biological resources, particularly well positioned to contribute to the export of green products and solutions.

MEASURE:

• Support the efforts on research and technology development, backing increased competitiveness in important export industries and new opportunities for export of green products and solutions.

4.22 Strengthen the knowledge triangleIn order to contribute to higher competitiveness and innovativeness, higher education, research and innovation (the knowledge triangle), these fields must be seen in context to a greater extent than they are today.

Innovation Norway, the Research Council of Norway and the Norwegian Centre for International Coopera-tion in Education (SIU) are currently working together in certain countries to promote this knowledge triangle. There are also programmes and economic instruments to contribute to more international collaboration, mutual student mobility, and interaction between higher education, research and the business commu-nity.

The collaboration programmes INTPART and UTFORSK promote long-term institutional collaboration between knowledge communities in Norway and eight priority countries for higher education and research colla-boration outside the EU (Brazil, Canada, India, Japan, China, Russia, South­Africa, and the US). Both programmes focus on possible connections with employment and the business community. The pilot programme InternAbroad is directed towards the same countries, and helps meet the competence require-ments of the business community by facilitating increased use of international practice mobility for students from Norway in exchange programmes. Norwegian insti tutions for higher education can apply for funds for establishing permanent arrangements for credits rewarding internships abroad, which students complete as part of their degrees at the home institu-tion. Thus, Norwegian students get, among other things, insight into business culture and language in markets important to the Norwegian business community. Experiences from the pilot programme may also be transferred to other countries where the Norwegian business community has strong interests.

Photo: University College of Southeast Norway - HSN

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Innovation Norway, the Research Council of Norway and SIU have a joint responsibility for operationalizing measures and activities connecting higher education, research and innovation, and for evaluating relevant measures and forms of collaboration.

The Government will enable Innovation Norway, the Research Council of Norway and SIU to develop their collaboration on higher education, research and innovation with strategically important countries further.

MEASURE:

• Facilitate further development of flexible instruments for international collaboration with strategically important countries, focusing on the connection between education, research, and innovation.

4.23 Increased industry and innovation collaboration in the Nordic regionThe Nordic governments have ambitions for the Nordic region to be the world’s most integrated region. In this, there is agreement on the importance of combating cross-border barriers between the Nordic countries. The Nordic Freedom of Movement Council was estab-lished in 2014 in order to remove cross-border barriers inhibiting mobility, free movement and value creation for individuals as well as businesses, and to prevent new cross-border barriers. The Nordic countries agree that a complete dismantling of cross-border barriers is neither realistic nor desirable, since the Nordic countries have different laws and regulations; however, it is just as important to be aware of the differences as to remove them. Efforts have also been initiated to evaluate trade barriers between Norway and Sweden. Trade between Norway and Sweden is extensive, and we are each other’s largest export market. In 2016, the Swedish Kommers kollegium presented a report where Norway is highlighted as the country where Swedish

businesses face the largest/most problems. The report states that that Norway has different VAT rules and customs barriers since Norway is not a member of the EU Customs Union. Little or no knowledge of Norway’s position as an EEA member country, especially when it comes to trade with agricultural or seafood products, may appear as a trade barrier in itself. Norway has informed Sweden that we are open to a closer dialogue on these issues. The Freedom of Movement Council will also review specific issues in the report from the Kommerskollegium more closely.

The Nordic region is facing a number of common challenges with regard to the green shift and how to create continued growth and employment in all parts of the Nordic countries so that the Nordic countries may still strengthen their welfare and competitiveness. The Nordic countries are all small, open economies particularly dependent on access to international markets, global value chains, talents, and knowledge. The countries make use of this differently in form of large differences in industry structure and business life. The Nordic Council of Ministers for Business has recently launched a new collaboration programme for the period 2018–2021 where the Nordic countries will work together to ensure rapid adaptability, strengthen innovativeness and competitiveness, and improve global market opportunities. Together, the Nordic countries will utilize the potential of Nordic collaboration and find sustainable solutions for the benefit of relevant parts of the Nordic region. The countries have also agreed that the Nordic interests are to be promoted in the EU, for example by influenc-ing the direction of future key EU programmes for the business community in areas where we have common interests. It has also been decided that the Council of Ministers for Business will work to improve Nordic collaboration in tourism, particularly directed towards knowledge sharing and joint marketing in remote markets.

Norway shall be a leading ocean economy

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MEASURE:

• Norway will strengthen industry and innovation collaboration in the Nordic region with an emphasis on the green shift.

4.24 Promoting the ocean industriesNorway is to be a leading ocean economy, and a preferred partner for collaboration in offshore busi-ness and sustainable utilisation of ocean resources. The OECD estimates that ocean industries may double their contribution to the global economy by 2030. This constitutes a wide scope of opportunities for Norwegian ocean industries, which already are highly export-oriented. The ocean industries represent about 70 per cent of Norway’s total export income. Norway also has a lot of competence to share with other countries. Knowledge of maritime admini stration, sustainable management and resource utilisation from the ocean and the continental shelf, is an export product in itself. The Norwegian compentence within the ocean industries is acknowledged internationally, and the industries constitute an important brand for the Norwegian business community abroad.

MEASURE:

• The Government will strengthen Norway’s profile as a leading ocean economy.

4.25 Maintain the mandatory fee for export of seafoodThe seafood industry is to continue the joint effort to promote seafood from Norway. The Norwegian Seafood Council is a public company owned by the Ministry of Trade, Industry and Fisheries, working with the Norwegian fisheries and aquaculture industry to develop markets for Norwegian seafood. The seafood

industry is financing the Seafood Council through a mandatory fee levied on all export of Norwegian seafood. The Seafood Council is the entity that gives Norwegian businesses approval as exporters, while functioning as an advisor for the Ministry of Trade, Industry and Fisheries on matters regarding export and trade. The activity is focused in three areas: marketing, market insight and communication, and preparedness. In 2014, the Seafood Council’s work was evaluated by Menon Business Economics, which concluded that the Seafood Council has largely con-ducted its activities in line with the goals set, and the operation have been appropriate. The need to promote seafood from Norway is still necessary.

MEASURE:

• Maintain the mandatory fee for export of seafood. The fee will be subject to evaluation on a regualar basis.

4.26 Examine the possibilities for growth and increased export in the renewables sectorThe renewables market is growing rapidly on a global level, and Norway will take part in this development by strengthening the export-oriented renewables sector. For example, offshore wind is now being developed rapidly in Europe. This is an area well suited for Norwegian petroleum­oriented supply companies, since they possess important competence in areas also relevant to this growing industry. Norwegian businesses also deliver solutions and technology in, for instance, hydroelectric power and solar energy, to international markets. Based on the technology and competence of Norwegian businesses, there should be room for considerable growth in the export from Norwegian businesses in this segment.

Photo: Innovation Norway

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The petroleum-oriented supply industry has a turnover of about 200 billion NOK in foreign markets, and is world­leading in several segments. In comparison, Norwegian-based supply industry to the renewables sector has a turnover of only about 5–7 billion NOK internationally. However, there is a large potential for taking a greater part of the international renewables market.

The efforts to internationalise Norwegian­based energy industries were previously carried out by two separate organisations; INTSOK for the oil and gas industry (established 1997) and INTPOW for the renewables industry (established 2009). From 1 January 2017, these entities were merged in Norwegian Energy Partners (Norwep). Norwep is a unique and very powerful private-public collaboration for increased promotion of export of the energy industries. The 10 founders represent authorities, organisations, and companies.19) Norwep currently has about 250 partner companies.

Norwep is one of the Government’s most important instruments for promoting internationalisation of the Norway-based energy industries. The merger makes it easier to utilize the synergy inherent in the transfer of competence between the two industries. Contri-buting to a larger degree of internationalisation and export of goods and services from Norwegian-based companies and in the petroleum and energy sector, is good economic policy.

19 The Ministry of Petroleum and Energy, the Ministry of Trade, Industry and Fisheries, the Ministry of Foreign Affairs, the Norwe-gian Shipowners’ Association, the Norwegian Oil and Gas Associa-tion, the Federation of Norwegian Industries, Energy Norway, the Norwegian Confederation of Trade Unions, Statoil, and Statkraft

MEASURE:

• Together with Norwegian Energy Partners, the Ministry of Petroleum and Energy will examine the possibilities for accelerating growth and export in the renewables sector. The efforts will include an evaluation of the possibilities for faster transfer of technology from other sectors, such as the oil and gas sector and the maritime sector, as well as coordination with other initiatives in order to take part in the increased growth in the global renewables sector.

4.27 Preparing information material on the Norwegian energy system, industrial development, and host attractivenessNorwegian energy resources have formed the basis for considerable export revenues through generations. This has been done through building an internationally competitive power­intensive industry, energy trade, sale of commodities such as oil and gas, as well as through the petroleum-oriented supply industry.

We have efficient and sustainable management of the energy resources (hydroelectric power, oil and gas), predictable framework conditions, and we have one of the world’s highest percentages of renewables in our domestic energy mix. This has given us a “greener” industry compared to many of our competi-tors. This could increasingly be a competitive advan-tage for the export of Norwegian products, but also for attracting foreign businesses to Norway.

The Government wishes to highlight the competitive advantages a large resource base has given Norwegian industry, and will therefore prepare suitable marketing materials to be used at our foreign service missons.

High quality seafood is crucial in order to have a competitive industry

industry is financing the Seafood Council through a mandatory fee levied on all export of Norwegian seafood. The Seafood Council is the entity that gives Norwegian businesses approval as exporters, while functioning as an advisor for the Ministry of Trade, Industry and Fisheries on matters regarding export and trade. The activity is focused in three areas: marketing, market insight and communication, and preparedness. In 2014, the Seafood Council’s work was evaluated by Menon Business Economics, which concluded that the Seafood Council has largely con-ducted its activities in line with the goals set, and the operation have been appropriate. The need to promote seafood from Norway is still necessary.

MEASURE:

• Maintain the mandatory fee for export of seafood. The fee will be subject to evaluation on a regualar basis.

4.26 Examine the possibilities for growth and increased export in the renewables sectorThe renewables market is growing rapidly on a global level, and Norway will take part in this development by strengthening the export-oriented renewables sector. For example, offshore wind is now being developed rapidly in Europe. This is an area well suited for Norwegian petroleum­oriented supply companies, since they possess important competence in areas also relevant to this growing industry. Norwegian businesses also deliver solutions and technology in, for instance, hydroelectric power and solar energy, to international markets. Based on the technology and competence of Norwegian businesses, there should be room for considerable growth in the export from Norwegian businesses in this segment.

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MEASURE:

• Prepare marketing material that shows how our energy resources form the basis for a sustainable Norwegian industry and export, while we have attractive frame-work conditions for industry, including foreign busi-nesses.

4.28 Initiatives for increased export of creative industriesAccording to a 2016 UNESCO report, the global trade in cultural products and services was doubled from 2004 to 2013, despite the global economic downturn. The report shows a significant shift from physical cultural products, such as CDs, DVDs and printed publications, to digital services. For example, the global sale of computer games was nearly USD 100 billion in 2016.

The interest in Nordic art and cultural expressions is strong and growing. Norway has a digital advantage and considerable public investment in the art and culture sector, which contributes to breadth and diversity. Our art and cultural production is at a high international level, however, compared to our Nordic neighbours, we have not been able to convert this into income-generating activities to any large extent.

The Government aims at placing more emphasis on culture as an industry and improving the opportunities for entrepreneurship in the culture sector. The alloca-tions to cultural and creative industries were increased in 2017. Measures that strengthen the international opportunities of Norwegian culture and help increase export of cultural and creative expressions, are central to this initiative.

Among the measures is an export programme for Norwegian architectural businesses. Norwegian architecture and building practices are historically

based on wood as material. Internationally there is increased interest in wood as building material due to its combination of technical and environmental characteristics. Many countries are now looking to Norway and the projects implemented in this area during recent years.

The foreign service helps Norwegian cultural stake-holders gain entry to central arenas and greater international impact. Norwegian embassies and consulates general contribute through their presence, local knowledge and various initiatives to the promo-tion, internationalisation and increased export of cultural and creative industries. Long-term promotion and strategic objectives form the basis for this work.

The efforts are created in close collaboration with the organisations in Norwegian Arts Abroad (see below).

Current initiatives to promote cul-ture and creative industries abroad

Missions for Norwegian Arts AbroadNorwegian Arts Abroad (NAA) constitutes a key part of the policy instruments for the focus on increased export of cultural and creative indus-tries (see page 35). The NAA’s mission includes an initiative directed towards the support system and the stakeholders in the value chain working to market and sell Norwegian arts and culture internationally, as well as increased travel grants for the industry and performers. By strengthen-ing the international experience, competence and network of the industry stakeholders, the NAA contribute to higher income for the respec-tive industries, and for the creative link in the value chain.

King Abdulaziz Center for World Culture in Saudi Arabia is designed by Snøhetta. Photo: Snøhetta/MIR

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Games to the world, an export pro-gramme for computer game companiesIn order to strengthen the competitiveness of the Norwegian computer game business, and in the long term contribute to increased value creation, the Ministry of Culture initiated an export-oriented pilot project together with Innovation Norway and the Norwegian Film Institute in 2016; Games to the world. After the call for applications, eight game companies with international growth ambitions were selected to participate in the programme.

The programme helps the selected companies with competence and capital, and it includes a joint industry initiative as a reinforced effort in the world’s largest marketplace for computer games, Game Developers Conference, in 2017.

Architecture to the world, an export programme for architectural businessesThe Ministry of Culture has tasked Innovation Norway with implementing an export-oriented programme for Norwegian architectural busi-nesses with growth potential and international ambitions, in collaboration with Design and Architecture Norway (DogA). The export pro-gramme aims at strengthening the opportunities of select architectural businesses for interna-tional assignments, and in the long term contrib-ute to increased value creation. The programme focuses on global entrepreneurship, competence sharing and arenas for international promotion

and networking, and will also include joint industry initiatives such as participation in international marketplaces and arenas. The programme will be implemented by model of Games to the world. The one-year programme was announced as an open competition in the spring of 2017, and will be initiated during the autumn of 2017.

Norway as a main country at the Frankfurt Book Fair in 2019Norway as a guest country at the Frankfurt Book Fair in 2019 will be one of the largest Norwegian foreign cultural initiatives ever, and will provide good opportunities for long-term promotion of Norwegian culture, intensified cultural collabora-tion and increased export – not only in Germany, but also globally. The Frankfurt Book Fair is the world’s largest arena for the sale of rights to book titles to the entire world. Other art forms, such as theatre, visual arts, design, film, and dance are also included in the guest country’s framework programme at other institutions in Frankfurt and elsewhere in Germany in 2019.

An express goal of the initiative is to contribute to increased value creation in the other cultural and creative industries, in addition to literature. Norway as a guest country at the Frankfurt Book Fair in 2019 will also help promoting Norway in a positive way and promoting the Norwegian business community.

Norwegian books published in chinese with support provided by NORLA for translation.

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• Assist Norwegian companies gain access to projects announced by the multinational development banks, UNOPS, and the Asian infrastructure bank.

• Assist Norwegian companies take a larger share of deliveries of goods and services to the UN system

4.30 Facilitating partnership with the business community in international development.The sustainable development goals cannot be attained without good interaction with the business community. This applies particularly to finding new solutions and utilizing new technology. It is vital that we in our work on development cooperation are able to utilize the knowledge the business community possesses, in order to attain innovation, renewal, value creation, sustainable growth, and thus increased welfare. Commercial considerations should not govern the development efforts, however, partnership with the private sector may help us reach our development policy goals.

The private sector is the driving force for lasting development and reduction of poverty. The private sector develops the necessary technology and new solutions necessary to reach the sustainable develop-ment goals. Development aid shall be risk­relieving, and in some cases, it could take on initial costs that commercial businesses are not willing to take. Most new businesses and jobs in poor countries are created locally and by locals, however, the Norwegian business community can contribute through its activities and its presence. The Government will enable Norwegian competence and Norwegian models to lend a helping hand to local stakeholders to establish their own businesses.

4.29 Making the business community’s role in the attainment of the UN sustainable development goals more visibleThe UN Sustainable Development Goals (SDG) see environment, economy and social development in context and set a common direction for authorities, businesses and civil society. This is a global effort to, among other eradicate poverty, combat inequality and stop climate change by the year 2030, based on 17 objectives and 169 intermediate objectives. The objectives apply to all countries and are a roadmap of the global effort necessary for sustainable develop-ment. In order to attain the sustainable development goals, enormous investments will be necessary in the years to come.

The SDGs are clear in their emphasis of the private sector which must strongly contribute in attaining the objective of sustainable development. This means that authorities must create a regulatory framework that makes it profitable for the business community to participate in achieving these goals.

The acknowledgement that the SDGs cannot be attained unless the private sector takes part as an active partner, also opens new opportunities for the business community. In the same way, as one sees the need for new thoughts in development aid policy, the business community must also adjust and adapt to the requirements and opportunities needed to achieve the SDGs. The Norwegian business community should explore this with regard to the home market, but even more in an international market context. The Norwe-gian business community possesses competence and technology which could make a positive contribution in a global context.

Humanitarian aid and various development projects under the auspices of the UN represent a considerable market potential for Norwegian businesses in them-selves. Every year, the UN buys goods and services for more than 150 billion NOK. Although the Norwegian deliveries are increasing, the Norwegian share is relatively modest at 0.26 per cent. Previously, Norwe-gian businesses delivered traditional emergency aid, however, products and services in renewable energy now increasingly dominate the Norwegian deliveries to the humanitarian market. Through active collabora-tion between the Norwegian business community and the humanitarian stakeholders, new technology and innovative solutions are being developed in order to fulfil the responsibilities of the UN system. Commis-sioned by the Government, Innovation Norway is responsible for, among other things, giving advice to Norwegian companies on the UN and the interna-tional humanitarian work.

MEASURES:

• Strengthen the efforts to promote sustainable global supply chains in agriculture and the food industry, which could also benefit the export of Norwegian food products if they can be documented to be sustainably produced.

• Maintain a focused dialogue with export-oriented businesses on the contribution to attaining the sustain-able development goals, and on the contributions of the goals to the industry’s survival and future. One important crossroad in this context is the meeting of the heads of state every 4 years (the next is in 2019) in order to discuss the status for follow-up of the goals in the UN General Assembly.

Source: UN

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• Assist Norwegian companies gain access to projects announced by the multinational development banks, UNOPS, and the Asian infrastructure bank.

• Assist Norwegian companies take a larger share of deliveries of goods and services to the UN system

4.30 Facilitating partnership with the business community in international development.The sustainable development goals cannot be attained without good interaction with the business community. This applies particularly to finding new solutions and utilizing new technology. It is vital that we in our work on development cooperation are able to utilize the knowledge the business community possesses, in order to attain innovation, renewal, value creation, sustainable growth, and thus increased welfare. Commercial considerations should not govern the development efforts, however, partnership with the private sector may help us reach our development policy goals.

The private sector is the driving force for lasting development and reduction of poverty. The private sector develops the necessary technology and new solutions necessary to reach the sustainable develop-ment goals. Development aid shall be risk­relieving, and in some cases, it could take on initial costs that commercial businesses are not willing to take. Most new businesses and jobs in poor countries are created locally and by locals, however, the Norwegian business community can contribute through its activities and its presence. The Government will enable Norwegian competence and Norwegian models to lend a helping hand to local stakeholders to establish their own businesses.

In line with the Governments’ white paper No. 35 (2014-2015) “Working together: Private sector develop-ment in Norwegian development cooperation”, the Government will concentrate the bilateral efforts in sectors where Norway has special expertise and which could provide professional support in developing countries. Energy, ICT, agriculture, fisheries/marine resources and the maritime sector are priority sectors. Strategic partnerships with the business community are central in business development. The private sector contributes with sought-after knowledge and technol-ogy beyond mere capital investments.

High commercial and political risk as well as poor framework conditions are reasons why companies often hesitate to invest in developing countries. Norfund is a central instrument in business develop-ment. Norfund is financed over the development budget, and its purpose is to contribute with equity and other risk capital, as well as give loans and provide guarantees for development of sustainable commercial activity in developing countries. The goal is to develop viable, profitable businesses which would otherwise not have been initiated due to high risk. As at 31/12/2016, Norfund has direct and indirect invest-ments in about 750 companies and a value adjusted equity of 19.3 billion NOK. Norfund shall not be the majority owner of its projects. The direct investments are to be additional and catalytic. This means that Norfund must draw other private stakeholders into the investments. Norfund’s investments can provide opportunities for the Norwegian business community and Norwegian investors in the areas and markets where Norfund operates. Norfund is assumed to have good knowledge of risks in the countries and segments where the fund invests.

Installation of solar panels in the powerplant own by Scatec Solar. Photo: Norfund

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MEASURE:

• In Meld. St. 24 (2016–2017) Common Responsibility for Common Future – The Sustainable Development Goals and the Norwegian Development Policy, the Government recommends a 50 per cent increase in the allocations for Norfund over the next parliamentary term.

4.31 The EEA grants. Aid for exploring markets in Central Europe and the BalticsThe EEA grants are Norway’s contribution to reduce social and economic disparities in the European Economic Area (EEA). An equally important goal for this work is to strengthen the connections and collabo-ration between Norway and the 15 recipient countries. Within this framework, the EEA grants should be directed, among other things, so that they create synergies to the greatest possible extent with the efforts made to promote the Norwegian business community abroad. Through the EEA grants, Nor­wegian businesses and innovation and knowledge communities can take part in networking and collabo-ration through an internationalisation process. Inno-vation Norway manages the industry-oriented growth programmes under the EEA grants, and several of the company’s foreign offices work exclusively with EEA grants. Norwegian businesses have good pros-pects for participating in projects with partners in the recipient countries. One example is the Norwegian company Tomra. Through projects financed by the EEA grants, Tomra has worked with several Polish companies on recovery and recycling of materials in Poland, which has led to Tomra currently being the leader in the Polish market. At the same time, it is reported that it can be a challenging task to recruit especially Norwegian businesses and institu-tions for collaboration. Mobilisation of partners will therefore be a priority,

at home and abroad, in the implementation of growth programmes during the next period under the over-arching theme of the EEA grants: “United for a green, competitive, and inclusive Europe”.

MEASURE:

• Strengthen the effort to inform the Norwegian business community of the EEA grants and the market opportu-nities in the recipient countries.

4.32 Team NorwayTeam Norway is the link between the stakeholders that contribute to the promotion of export and internation-alisation. In a knowledge economy, this is increasingly tied to the promotion of knowledge and the so-called knowledge triangle (the connection between education, research, and innovation). As stated in chapter 3.4, Norwegian authorities’ work to promote export and internationalisation of the business community is performed by a number of different stakeholders, including various ministries, the foreign service and policy instrument administrators such as Innovation Norway, the Norwegian Seafood Council, Music Norway, the Research Council of Norway and the Norwegian Centre for International Cooperation in Education, and publicly funded stakeholders such as Norwegian Energy Partners. In order for the efforts to be as coordinated as possible, these stakeholders collaborate in Team Norway. The purpose of the Team Norway collaboration is to contribute to increased value creation in the Norwegian economy through the exchange of information, coordination, and coordinated efforts and initiatives. Involvement and participation from the business community and other relevant stakeholders is central for Team Norway, and meetings are held regularly with representatives from the Norwegian business community and knowledge

Photo: Port of Oslo. Daniel Spiro/Port of Oslo

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communities through a reference group, where goals and priorities are shared and discussed.

The Ministry of Trade, Industry and Fisheries leads the work in Team Norway, in close collaboration with the Ministry of Education and Research, the Ministry of Petroleum and Energy, and the Ministry of Foreign Affairs. The work abroad is coordinated by the Nor­wegian foreign service missions, in close collaboration with the Team Norway stakeholders present and the Norwegian business community.

MEASURES:

• Collaboration, sharing knowledge and clarification of responsibility between policy instrument administra-tors are to be prioritized. The policy instrument administrators are to work to have sufficient compe-tence to identify when other stakeholders should be brought into a project.

• An annual Team Norway Forum is to be established in Norway where the various Team Norway stakeholders gather to exchange experiences and discuss priorities.

• Prepare a list of priority countries for work in Team Norway.

• Promotion material on the Norwegian business community and knowledge communities is to be prepared for the foreign service missions and Team Norway to use for positioning the Norwegian business community and Norwegian knowledge communities abroad.

• Strengthen the business and promotion work at the foreign service missions.

• The foreign service missionsin priority countries are to strengthen the work with Team Norway and assume responsibility for coordinating Team Norway stake-holders in their service areas.

4.33 Economic diplomacy The foreign service promotes Norwegian business interests abroad, in close collaboration with ministries and agencies. They are door openers, problem solvers and network builders contributing to the creation of good meeting places. The foreign service missions have first­hand knowledge of local conditions and access to networks and authorities in the relevant country. The business community’s need for assistance from the foreign service varies according to the type of market and the type of business. In emerging economies, market access, assistance for establish-ment, for example through the door opener function, and the foreign service missions’ cultural understand-ing, will be particularly important. In mature markets, the need for individual follow-up will not be as impor-tant. In demanding markets, security and corruption can represent a challenge, or generally an effort for better framework conditions. SMEs will have other counselling needs than large businesses, and it is important that the foreign service is able to assist businesses regardless of size and sector. Changes in the Norwegian and global economy also lead to changes in the business community’s demand for assistance from the foreign service. It is therefore important that the foreign service can redirect resources quickly to areas where the business community needs assistance.

The Norwegian business community faces an increas-ing degree of trade and investment barriers when they are to export or establish themselves abroad. This is due to the fact that they trade more with countries where such barriers are common. In many of our emerging markets, we experience that in addition

at home and abroad, in the implementation of growth programmes during the next period under the over-arching theme of the EEA grants: “United for a green, competitive, and inclusive Europe”.

MEASURE:

• Strengthen the effort to inform the Norwegian business community of the EEA grants and the market opportu-nities in the recipient countries.

4.32 Team NorwayTeam Norway is the link between the stakeholders that contribute to the promotion of export and internation-alisation. In a knowledge economy, this is increasingly tied to the promotion of knowledge and the so-called knowledge triangle (the connection between education, research, and innovation). As stated in chapter 3.4, Norwegian authorities’ work to promote export and internationalisation of the business community is performed by a number of different stakeholders, including various ministries, the foreign service and policy instrument administrators such as Innovation Norway, the Norwegian Seafood Council, Music Norway, the Research Council of Norway and the Norwegian Centre for International Cooperation in Education, and publicly funded stakeholders such as Norwegian Energy Partners. In order for the efforts to be as coordinated as possible, these stakeholders collaborate in Team Norway. The purpose of the Team Norway collaboration is to contribute to increased value creation in the Norwegian economy through the exchange of information, coordination, and coordinated efforts and initiatives. Involvement and participation from the business community and other relevant stakeholders is central for Team Norway, and meetings are held regularly with representatives from the Norwegian business community and knowledge

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to the traditional customs barriers, cumbersome import regulations and discriminating and protectionist procedures constitute important barriers. Norway works to simplify trade and create better and more predictable terms, through our work in the WTO as well as in our bilateral free trade agreements. The work on non-customs trade barriers is emphasized in both these channels.

In order for the continued work to promote the interests of the Norwegian business communities and solve the actual problems they are facing to the greatest extent possible, it is also important to survey the trade and investment barriers in individual export markets. Our foreign service missons in particular, by having regular contact with the Norwegian business community abroad, are able to help provide a better overview of the challenges our export businesses are facing.

MEASURES:

• The foreign service is to continue its efforts to promote Norwegian business interests abroad in close collabo-ration with the relevant ministries.

• The foreign service is to emphasize the business community’s interests and needs related to localisation of the foreign service missions and the distribution of resources between these.

• Foreign service missions are to survey perceived trade barriers the Norwegian business community faces in its service areas, as part of the existing periodical reporting.

The vessel Polarsyssel, operating for the Governor of Svalbard. Photo: The Norwegian Coastal Administration

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Picture on jacket

Front page:Photo: ThinkstockThe hydrolyse trawler Molnes. Photo: Nordic Wildfish

Back page:Hywind Demo outside Karmøy. Photo: Laila Sømme/StatoilPhoto: Thinkstock

Published by:The Ministry of Trade, Industry and FisheriesPublic institutions may order additional copies from: Norwegian Government Security and Service OrganisationEmail: publikasjonsbestilling@dss.dep.noInternet: www.publikasjoner.dep.no Telephone: + 47 222 40 000Publication code: W-0020 E Design: Anagram Design asPrint: Norwegian Government Security and Service Organisation12/2017