Low balance of goods and services
For the first time since 1987, the surplus on Norway’s balance of goods and services is lower than the balance of income and transfers with the rest of the world. This situation appears to be the result of lower prices on oil and natural gas as opposed to higher dividends on investments abroad.
|1st quarter 2015||2nd quarter 2015||3rd quarter 2015||4th quarter 2015||1st quarter 2016|
|Current account balance||85 693||72 091||62 075||52 857||54 018|
|Balance of goods and services||54 974||41 209||36 528||42 263||22 323|
|Balance of income and current transfers||30 719||30 882||25 547||10 594||31 695|
|Capital transfers to abroad, net||719||122||24||5||739|
|Net lending, current account||84 962||71 969||62 051||52 852||53 267|
|Direct investment||28 334||38 438||26 042||61 249||19 725|
|Portofolio investment||3 092||143 687||111 221||43 328||-82 407|
|Other investments||-6 276||-143 636||-28 792||-5 906||34 810|
|Reserve assets (IMF breakdown)||17 995||-5 526||-24 023||-34 050||41 610|
|Net lending, financial account||43 145||32 963||84 448||64 621||13 738|
|Net errors and omissions||41 817||39 006||-22 397||-11 769||39 529|
Oil and gas prices remain low
Exports in the 1st quarter of 2016 were estimated at NOK 259 billon, which is lower than previous quarters in 2015. It is particularly the price of oil and gas that is contributing to this. The volumes of these products are increasing slightly. For more information about exports and imports, including price and volume considerations and seasonal adjustments, please see the quarterly national accounts. These accounts showed an export value for oil and gas that was NOK 20 billion lower than in the 4th quarter of 2015.
Imports in the 1st quarter of 2016 are preliminarily estimated at NOK 236 billion, which is about NOK 15 billion less than in the 4th quarter, and also less than the other quarters in 2015. It is mainly the goods that are causing the decrease, while the services are estimated at the same levels as the previous quarter.
The balance of goods and services is estimated at NOK 22 billion in the 1st quarter of 2016, which is NOK 20 billion less than the previous quarter. The balance of goods and services is at its lowest since before 2000.
Balance of income and current transfers dominate
The balance of income and current transfers ended at NOK 32 billion in the 1st quarter of 2016, which is over NOK 9 billion more than the balance of goods and services. This is the first time that the income and current transfers have been higher than the balance of goods and services since 1987. This time it is due to the combination of low oil and gas prices and high dividends on investment abroad, partly as a result of a low-priced NOK.
Increased deposits and reduced loans abroad from Norwegian banks
In the 1st quarter of 2016, total net purchases of financial assets amounted to NOK 203 billion. Norwegian banks invested large amounts in deposits abroad, while banks’ loans to non-residents were considerably reduced during the first quarter. The increase in foreign direct investment was driven by intra-group loans, while reduced investment in debt securities dominated the decline in portfolio investment abroad.
The liability side saw a steady rise in direct investment, portfolio investment and other investment in Norway. Total net purchases were NOK 189 billion.
The current account balance has been revised by almost NOK 10 billion for 2015 as a result of new information.