Norway: Economic and Political Overview
In this page: Economic Outline | Political Outline
Preliminary national account figures indicate a 0.6% annual growth in mainland Norway's GDP from 2023 to 2024, adjusted for constant prices. The mainland economy saw nearly zero growth in 2023, but activity has picked up slightly in 2024. However, a carry-over effect from 2022 results in annual growth similar to the previous two years. Demand from central and local governments, strong petroleum investment, and growth in mainland exports have supported the mainland economy. Conversely, a decline in investment in residential and commercial buildings, alongside modest growth in private consumption, has exerted a counteracting effect. The IMF forecasts growth of 1.8% this year and 1.7% in 2026, driven by a consumer-led recovery in consumption, strong performance in the oil and gas sector, and fiscal stimulus.
Norway’s public finances are sound. The government's gross debt did not expand substantially in the aftermath of the Covid-19 crisis unlike in the rest of Europe, despite public monetary support and a comprehensive loan programme to the banks. The surge in energy prices during 2022-2023 further bolstered the sovereign’s fiscal and external buffers. Norway’s internationally comparable budget surplus, including petroleum revenue, stood at 16.3% of GDP in 2023, with expectations to remain around 14% in 2024 and 2025. Norges Bank estimated the structural non-oil budget deficit to be 10.7% of mainland trend GDP in 2024, driven by fiscal-easing measures equivalent to 1 percentage point of mainland GDP. This figure excludes Government Pension Fund Global (GPFG) transfers (whose total assets were estimated at NOK 19,742 billion as of 31 December 2024). Norway’s fiscal rule targets a 3% annual transfer from the GPFG throughout the economic cycle, reflecting the fund's expected long-term real return. In 2024, the debt-to-GDP ratio was estimated at 42.7%, down from 44% one year earlier. The ratio is expected to remain stable over the forecast horizon (IMF). The Norwegian economy has experienced unusually high inflation in recent years, but it slowed significantly in 2024. Inflation is estimated to have increased by 3.5% from 2023 to 2024, a decrease from 4.2% the previous year (official governmental figures).
Official estimates suggest that accrued annual wage growth reached 5.7% in 2024. This increase slightly outpaced the rise in the consumer price index, resulting in real wage growth for the first time since 2021. The unemployment rate was estimated at 4.3% in 2024, up from 3.6% one year earlier, and is expected to stabilize around 3.8% in the medium term. Overall, Norway is a rich country, with one of the highest GDP per capita in the world (USD 103,446 PPP in 2024 by the IMF). The nation also scores at the top of the United Nations Human Development Index ranking.
| Main Indicators | 2023 (E) | 2024 (E) | 2025 (E) | 2026 (E) | 2027 (E) |
|---|---|---|---|---|---|
| GDP (billions USD) | 485.31 | 503.75 | 506.47 | 509.34 | 522.44 |
| GDP (Constant Prices, Annual % Change) | 0.5 | 1.5 | 1.8 | 1.7 | 1.6 |
| GDP per Capita (USD) | 87,703 | 90,434 | 90,320 | 90,233 | 91,941 |
| General Government Balance (in % of GDP) | -9.6 | -10.4 | -11.1 | -11.6 | -11.9 |
| General Government Gross Debt (in % of GDP) | 44.0 | 42.7 | 42.7 | 42.5 | 42.0 |
| Inflation Rate (%) | 5.5 | 3.3 | 2.4 | 2.0 | 2.0 |
| Unemployment Rate (% of the Labour Force) | 3.6 | 4.3 | 3.8 | 3.8 | 3.8 |
| Current Account (billions USD) | 86.83 | 73.13 | 63.50 | 53.83 | 45.82 |
| Current Account (in % of GDP) | 17.9 | 14.5 | 12.5 | 10.6 | 8.8 |
Source: IMF – World Economic Outlook Database, Latest data available.
Note : (E) Estimated data
Agriculture accounts for 2.1% of Norway’s GDP and employs 1% of the workforce (World Bank, latest data available). Fishing is an important activity as Norway is the world's second-biggest seafood exporter after China. The country has 36,790 agricultural holdings (Statistics Norway) and is more than self-sufficient in animal products, livestock being one of the major agricultural subsectors. However, Norway remains dependent on imports for cereal crops (soybeans, wheat, rapeseed and bananas) and agricultural subsidies are very significant. About 33.4% of Norway’s total land area is covered by forests (12.6 million ha). According to the Norwegian Seafood Council, Norway exported USD 15.5 billion worth of seafood in 2024, the highest level ever recorded, marking an increase of USD 327 million from the previous year. The total export volume reached 2.8 million metric tons.
Industry employs 19% of the workforce and represents 39% of GDP. Norway’s economy depends on its natural resources and energy sources (oil, gas, hydraulic energy, forests and minerals). Oil rents, which have once dominated the economy, now provide around 5% of GDP, well below its peak level in 2000. Nevertheless, the oil and gas sector is Norway's largest measured in terms of value-added, government revenues, investments and export value. The government's total net cash flow from the petroleum industry was estimated to be NOK 701 billion in 2024 (Norskpetroleum). Overall, the “extraction and related services” sector accounts for 83.2% of total industrial output in 2024 (Statistics Norway). Manufacturing accounts for only 6% of GDP. Shipbuilding, metals, wood pulp and paper, the chemical industry, machinery and electrical equipment make up Norway’s main manufacturing industries. Norway also has one of the largest and most modern fleets in the world.
The Norwegian service sector is highly developed; it employs over 79% of the population and accounts for half of the GDP. The tourism sector is an important source of income: according to Statistics Norway, 2024 was a record year for Norwegian accommodation establishments, with an all-time high of 38.6 million guest nights, up 4.2% from 2023. As per the Norwegian banking sector, it is comprised of 124 banks of which 106 are local banks and 18 are branches of foreign banks. The market share of the subsidiaries and branches of foreign banks were 23% and 36% in the retail and domestic corporate markets, respectively (European Banking Federation, latest data available).
| Breakdown of Economic Activity By Sector | Agriculture | Industry | Services |
|---|---|---|---|
| Employment By Sector (in % of Total Employment) | 2.5 | 18.9 | 78.5 |
| Value Added (in % of GDP) | 2.1 | 39.0 | 50.0 |
| Value Added (Annual % Change) | -6.1 | 0.2 | 1.1 |
Source: World Bank, Latest data available.
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The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.
Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation
The business rankings model measures the quality or attractiveness of the business environment in the 82 countries covered by The Economist Intelligence Unit’s Country Forecast reports. It examines ten separate criteria or categories, covering the political environment, the macroeconomic environment, market opportunities, policy towards free enterprise and competition, policy towards foreign investment, foreign trade and exchange controls, taxes, financing, the labour market and infrastructure.
Source: The Economist Intelligence Unit - Business Environment Rankings 2020-2024
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The world rankings, published annually, measures violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire incorporating the main criteria (44 in total) to assess the situation of press freedom in a given country. This questionnaire was sent to partner organisations,150 RWB correspondents, journalists, researchers, jurists and human rights activists. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).
The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.
Political freedom in the world (interactive map)
Source: Freedom in the World Report, Freedom House
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