Norway’s 2011 Budget Will Help Keep Low Rates, Stoltenberg Says

Norwegian Prime Minister Jens Stoltenberg

Norway’s Prime Minister Jens Stoltenberg pledged to curb the use of oil revenue in the 2011 budget to ensure interest rates in the world’s sixth-largest oil exporter stay low as the economy emerges from recession.

The 2011 budget should “safeguard the Norwegian economy, secure jobs and contribute to a low interest rate,” Stoltenberg told reporters yesterday as government members gathered to discuss the budget in Jevnaker, Norway. “We will reduce the use of oil money to a level equal to the return of the oil fund. How quickly and how much we will do in each year is what we will decide once we are finished working with the budget.”

The Labor-led government, re-elected in September, has promised to restrict the use of the nation’s $450 billion oil wealth that was used to plug budget deficits. Stoltenberg’s Cabinet is breaching spending limits for two consecutive years, having implemented a stimulus package to revive the economy in 2009 and keep unemployment the lowest in Europe.

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Source: Business Week