 Norway: Telecoms and technology background
FROM THE ECONOMIST INTELLIGENCE UNIT
Because of its small population size, Norway is outside the top ten information and communications technology (ICT) markets in western Europe in terms of absolute spending on ICT services.
According to the European Information Technology Observatory (EITO), the worldwide ICT market was worth €2.04trn in 2005, with Scandinavia accounting for just 2.5% of the total.
The market value for western Europe was €632bn in 2005, with Scandinavia accounting for 8.8%. This is low compared with some of the larger economies, given that Germany accounts for 21.5% and the UK for 19.1%. Within Scandinavia, Norway ranks third, behind Denmark and Sweden, but ahead of Finland, in terms of spending per head, at €2,178 per inhabitant, compared with €2,277 for Denmark and €2,261 for Sweden (2004 data). This compares with €1,517 on average for western Europe. Worldwide, Denmark, Sweden and Norway are just behind the leaders, Switzerland and the US. A breakdown reveals that carrier services and information technology (IT) services are the two largest growth sectors in western Europe.
According to Statistics Norway (the national statistics agency), Norway's ICT sector employed 104,351 people in 2004, or 6.7% of Norway's total mainland workforce outside of the public sector. Of these, 35,743 worked in the contents sector.
As the result of a change in methodology, employment figures for 2004 cannot be directly compared with previous data. ICT employment in Norway is dominated by IT consultancy services, which account for roughly 45% of all ICT employment, as opposed to the manufacturing of hardware, of which there is little in Norway, unlike in Finland and in Sweden, where the ICT sectors are dominated by large domestic manufacturers, such as Nokia and Eriksson. According to Norway Statistics (the official statistics agency), total turnover in the ICT sector was Nkr220bn (US$32.6bn) in 2004, or roughly 8.2% of total private-sector turnover in the mainland economy (excluding the offshore oil and gas extraction industry).
Total ICT turnover increased by 6.6% year on year in 2004, a marked improvement from 2003, when turnover had fallen year on year. However, growth in the ICT sector was still below that of the total private sector, where turnover increased by 7.4% in 2004 year on year. The pick-up in 2004 should be seen against a backdrop of a sharp recovery in the domestic economy in 2004, following two years of weak growth in 2002-03. The recovery continued in 2005. Early estimates based on value-added tax (VAT) returns indicate that turnover in the ICT sector increased by 6% year on year in the first six months of 2005.
Norway is a net importer of ICT goods. In 2004 the value of the country's ICT exports, including electrical machinery, was Nkr13.1bn (US$1.9bn), up by 8.5% on 2003. ICT imports totalled Nkr36.1bn in 2004, an increase of 20.9% from the year before. Telecoms equipment, measurement and control equipment and computers were the largest export groups, and electrical appliances, followed by computers, were the largest import categories.
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SOURCE: The Economist Intelligence Unit
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