We have always known that trade agreements have very positive aims and Norway have proved that. This land’s trade surplus of February was NOK 325 billion (around USD 55 billion) ranking 6th in the world, just behind Saudi Arabia, China, Germany, Russia and Ireland.
This surplus is basically focused on the oil and gas exports, which are the pillars or the Norwegian economy. One key element is that Norway makes very few buys and sells a lot, just few countries in the world does that. Thus, nearly 60 percent of Norway’s export revenues derived from oil and gas sales, the rest mostly from seafood, electricity, aluminum and weapons.
Is interesting to see that only the 15 percent of the export revenues are generated by manufactured goods, that is due to the fact that in Norway the labor costs are very high.
Is worth mentioning the Irish case as well, where the trade surplus is fueled largely by multinational firms that set up production sites in Ireland because of tax advantages; in the years when the crisis was eating up the society, the policies implemented together with the trade-agreements where the keys for boosting the exports income at a time when Ireland’s own domestic economy suffered a downturn that led to reduced imports. It is said that Ireland’s trade surplus doesn’t necessarily boost its own revenues or economy, benefiting immigrant workers. That will be something to prove in these days post financial crisis.
So the reflective questions that arise are like, can trade be good to all the countries making agreements? are countries entering trade agreements allowed or encourage to sell more and buy less? In other words, to really benefit from the trade-agreements, to develop policies, strategies, markets to the betterment of the nations, to focus on what you do better, despite the global pressures/tendencies.
That´s the idea on which the focus should be placed: fairness on the agreements, promote trade-agreements always considering the idea that should benefit all parties involved.
By Felipe Díaz (news notes taken from Views and News from Norway, The Economist and Aftenposten)