Dark clouds over Norwegian economy
-Norway has a deadly combination of a badly functioning banking sector, companies cutting staff and households saving money, a leading Norwegian economist says. He believes no other developed country, except Iceland and Ireland, has seen such a rapid growth stagnation as Norway.
Harald Magnus Andreassen, head economist in the First Securities company, believes Norwegian authorities have failed to see the possible grave domestic consequences of the international crisis. He argues that Norway perceived the problems as linked only with a foreign banking crisis and that the authorities saw no urgent needs for rapid measures to prevent a major hike in domestic unemployment.
-That analysis was wrong, Mr. Andreassen says to newspaper Dagens Næringsliv. –Therefore powerful political measures need to be taken also in Norway, the same way as in the countries around us, he adds.
The economist now recommends a rapid decrease in interest rates and tax cuts.
Figures from the Statistics Norway now shows negative parameters from several sectors of the economy. New housing construction dropped more than 20 percent in October year-on-year from 2007.
In the northern county of Troms, the construction of new housing was down with as much as 69,5 percent in the period.
