Topic: Sustainable Economic Policy
Country: Norway
Delegate Name: Noah Weller
School: Forest Hills Eastern High School
Topic page: background guide and all position papers All Norway position papers GLIMUN 2015 committees
According to Robert Goodland of the World Bank, economic sustainability is usually defined as the idea of responsibly growing one’s economy with thought for both the current economic requirement and the potential needs of future generations (this process is generally achieved through a country producing more resources than it consumes). It can also include the process of a government spending only as much as it can afford to without entering perpetual debt. Due to the globalization and interconnectedness of the world’s economies and financial systems, a great deal of international cooperation on sustainable economic planning is required in order to prevent another worldwide economic crisis, such as the one experienced in 2008. The United Nations Department of Economic and Social Affairs maintains targets of sustainable economic growth, strong financial institutions, and labor rights, with their plan of economic goals stretching nearly twenty years into the future. Additionally, organizations such as the World Bank and the International Monetary Fund perform economic audits on nations around the world in order to analyze the health of their economies. On a smaller scale, Norway, a country with an economy largely based on a finite economic resource, has, since the 1970s, prioritized a state-guided economic plan in order to secure financial security, both now and into the future.
Norway’s economy is based largely on the extraction and refinement of fossil fuels, especially oil and natural gas. With this said, it has always been of the highest priority for this finite resource to be properly monitored and managed, so as to preserve the financial well-being and way of life for future generations. While it is inevitable that the oil reserves will eventually run dry, the government of Norway regulates the amount of oil that can be extracted, buying more time for alternative economic plans to be drawn up and implemented. Additionally, Norway’s largest oil company, Statoil, is owned mostly by the Norwegian government, mostly with the intention of using its profits to provide an economic safety net. This ideology is embraced through the Government Pension Fund Global, or Statens pensjonsfond Utland, a fund into which the government of Norway deposits the excess profits from its state-run oil holdings. The GPFG / SPU is said to be the largest stockholder in Europe, holding shares in various businesses around the world (and increasingly in developing countries), and has a total value of nearly 7.25 trillion krone, or 857 billion 2014 US dollars. Norway is not solely focused on the sustainability of its own economy, however. For instance, in 2011, Norway entered into an economic agreement with Brazil, in which one of the stipulations was that Brazil continue to limit the deforestation of the Amazon Rainforest, both in order to increase greenhouse gas absorption and to provide for responsible economic gain in the future. Another stipulation was for the Brazilian government to coast, protecting a fish population so that it can continue to thrive and be fished from for years to come.
Recognizing the grave danger of uncontrolled economic decisions and deeply concerned by the relative lack of economic safeguards worldwide, the Kingdom of Norway calls upon the world to change both in theory and in practice. Ideologically, Norway would advise each nation to take upon a responsibility of economic restraint, either requiring or encouraging all major non-service industries and economic institutions to balance their level of production with their level of consumption, in order to both prevent a possible economic failure (should there be a major hiccup in trade), and to allow for an environment of financial well-being for future generations. Furthermore, Norway would advocate for partial state ownership of one or more companies or industries, the profits of which should be placed into a pension fund or other account in order to provide both additional funds for the government’s budget and, more importantly, to provide a safeguard and “emergency fund.” should the current economic structure become either unsustainable or obsolete. This strategy is even used in newly industrialized nations such as South Africa, where the Department of Public Enterprises owns a number of companies, including some involved in the energy, mining, and transportation sectors. These state-owned enterprises provide additional funds for the South African government’s budget, which the government in turn uses to improve infrastructure while limiting strain on its coffers. On a related subject, Norway would urge the governments of the world to refrain from spending over their budget on a regular basis, in order to limit debt and free up financial resources for use elsewhere. To conclude, in terms of economic sustainability, a relatively small effort on today’s governments’ part will prevent enormous problems for the governments, economies, and people of tomorrow.
