OSLO: Norway posted its first public deficit in 25 years in the second quarter, its finances weighed down by the effects of the coronavirus pandemic, Statistics Norway said Wednesday.
The Scandinavian country, which is the biggest oil and gas producer in western Europe, saw its accounts fall into the red in the April-June period, to -83 billion kroner (almost -8 billion euros, -$9.46 billion), after registering a 22 billion kroner surplus in the first quarter.
The fall was attributed to dropping oil revenues as well as lower dividends and tax revenues, while spending increased to mitigate the economic effects of the pandemic and because of higher unemployment benefits, Statistics Norway said. "The public sector has thereby protected the private sector from the brunt of the decline in national income. The flip side is that for the first time in a long while, the state is going from a surplus to a deficit," an economist at the statistics agency, Pal Sletten, said. Norway's public surplus has averaged 10.7 percent of gross domestic product in 2002-2019. The second quarter deficit represents 10.3 percent of GDP, the agency said.
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