Mainland GDP growth of 3.5% is projected for 2022, reflecting the final phase of recovery in the wake of the pandemic. In 2023, economic growth will have declined towards its long-term potential rate, at 1.7%. Risks to inflation are pronounced, given the broadening of large price increases and elevated uncertainties around commodity prices. The labour market, already tight, will add to pressures on wage inflation. House prices and household indebtedness remain high.
Norway has been more successful than many countries in limiting the spread and impact of COVID‑19. The country has maintained good outcomes on many economic and social indicators. GDP per capita remains among the highest in the OECD. However, there are challenges in sustaining good outcomes amid post‑pandemic economic adjustment, continued population aging and the urgency of tackling climate change. Labour force participation needs to increase to ensure the high levels of employment that are key to Norway’s socio‑economic model. Higher productivity growth is essential for businesses to remain competitive. Meanwhile, economic activity must continue to adjust to achieve a faster decline in greenhouse‑gas emissions.
The pandemic recovery offers an opportunity to reinvigorate business dynamism and ensure that education delivers on skills. This will help maintain good living standards and support comprehensive public services.
©Shutterstock/Anton PetrusRead full country note