Norway, Asia and the Global Value Chains. Asia’s Growth and Norway’s Economic Links to Asia.

Abstract:

The study examines the economic development of and Norway’s economic links to Asia.During the latest decades, this region has grown to a major player in the world economy. The growth of the region is characterised by regional production networks, with large and fast- growing intra-regional trade in intermediate goods. Compared to Europe, there is less intra-Asian trade in consumer goods.

Asia is more heterogeneous than Europe, with several countries poorer than Romania and Bulgaria at the low end of EU-27. The poorest countries have grown fastest, contributing to convergence, and this is expected to continue. Even with lower growth rates than in the recent past, the nominal GDP of the region may double by 2025, increasing further its importance of Asia in the world economy. For some middle-income countries, upgrading of skills and institutions is necessary in order to avoid the middle income trap and develop further into more skilled industries and services.

Norway has maintained its share in the foreign trade of Asia-16; thereby following the exceptionally fast trade growth and maintaining balanced trade with the region, or a slight surplus if services are included. During the last decade, there was exceptionally high export growth to a number of Asian markets. Norway exports commodities and capital goods to Asia, and imports consumer and capital goods. Seafood exports to Asia remain significant but its share has decreased over time. Norway’s trade with China also grew fast during recent years, with a peak in 2009. After 2009 there was a general decline, affecting several sectors of imports as well as exports.