National accounts, June 1999

The decline in GDP from last year was due to both a drop in households consumption expenditure and a decrease in fixed capital investments in government and corporate sectors. Consumption in households and non-profit institutions serving households (NPISHs), decreased in volume by 0.5 per cent from the second quarter of 1998 to the second quarter of this year, following an increase of 3,9 per cent the previous quarter. The movements of the consumption figures for the first two quarters of 1999 compared to the corresponding periods in 1998, should be seen in relation to light of the Easter holidays effect. In the first half of 1999, households consumption expenditure was 1.6 per cent higher compared to the first half of 1998.

In households, consumption of goods decreased by 3.3 per cent in the second quarter of 1999 compared to the same quarter the year before, while the consumption of services grew by 2,8 per cent. Seasonally adjusted figures show that consumption in households and NPISHs was 0.2 per cent higher in the second quarter compared with the first quarter of 1999.

For general government consumption, a volume growth of 2.9 per cent has been estimated so far for

the second quarter of 1999 compared with the same quarter in the previous year. The growth was stronger in local government than in the central government, 3.7 and 1.6 per cent respectively.

Decline in investments

Gross fixed capital formation decreased in volume by 10.3 per cent from the second quarter of 1998 to the second quarter of 1999. For mainland Norway, the calculations show a reduction in the investment volume of 9.7 per cent. A somewhat stronger decline of 11.7 has been estimated for investments in the petroleum activities. Also in general government, a strong decline in investements took place in the second quarter of 1999. When seasonally adjusted, the decrease in total gross investments in fixed capital amounted to 6.3 per cent relative to the previous quarter.

Increased surplus on the current account

Preliminary calculations show a surplus on the current account balance with the rest of the world of NOK 6.2 billion in the second quarter of 1999, compared to a very slight surplus in the first quarter. Last year we experienced the opposite with a significant surplus in the first quarter, followed by a small deficit in the second quarter.

In the second quarter of 1999 total exports hardly moved in volume relative to the second quarter of last year, while the volume of imports decreased by close to 4 per cent. The exports of both traditional goods, ships and oilplatforms increased, while exports of crude petroleum, natural gas and services decreased in volume.

Imports of traditional goods went down by 5.1 per cent from the second quarter of 1998 to the same quarter this year. Corrected for seasonal fluctuations, total exports increased by 1.8 per cent from the previous quarter, while imports decreased by 2.9 per cent.

Lower production activity in manufacturing

Compared with the same quarter in the previous year, there was a decline in industrial production in the second quarter of 1999 by 2.9 per cent, while seasonally adjusted figures show a decline from the first quarter of 3.8 per cent. Also in other goods producing industries the production fell compared to the second quarter of last year. In the services industries, a growth in production of 2.0 per cent has been estimated. In central government the growth was slightly slower by 1.8 per cent, while production in local government went up 3.6 per cent.

Continued growth in employment

Preliminary calculations show that there was a total increase in employed persons of 0.7 per cent from the second quarter of 1998 to the second quarter of this year. There was a set back in employment in most goods producing industries, while a growth has been estimated for many services industries and for general government.