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The right of Dutch workers to associate freely is well established. Just under 25 percent of the employed labor force belongs to unions. Unions, while entirely free of government and political party control, may and do participate in political life. All union members, except most civil servants, have the legal right to strike. Even Dutch military personnel are free to join unions. Disputes involving civil servantas are subject to arbitration.

b.

The Right to Organize and Bargain Collectively

The right to organize and bargain collectively is recognized and well established. Discrimination against union membership does not exist. Dutch society has developed a social partnership among government, private employers, and trade unions. This tripartite system involves all three participants in negotiating collective bargaining agreements which cover about 76 percent of Dutch workers.

C.

Prohibition of Forced or Compulsory Labor

Forced or compulsory labor is prohibited by the constitution and does not exist.

d.

Minimum Age for Employment of Children

The minimum age for employment of young people is 16. At that age, youths may work full time only if they have completed the mandatory 10 years of schooling. Those still in school at age 16 may not work more than 8 hours per week. Laws prohibit youths under the age of 18 from working at night, overtime, or in areas which could be dangerous to their physical or mental development. In order to promote the employment of young people, the Netherlands has a reduced minimum wage for employees between ages 16 and 23.

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Dutch law and practice adequately protect the safety and health of workers. There is no legally-mandated work week; it is set by collective bargaining. The average workweek for adults is 38 hours. The legally-mandated minimum wage is subject to semi-annual living cost adjustment.

f.

Rights in Sectors With U.S. Investments

The above described workers rights hold equally for goods-producing sectors in which U.S. capital is invested.

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(D)-Suppressed to avoid disclosing data of individual companies

Source:

U.S. Department of Commerce, Survey of Current Business
August 1991, Vol. 71, No. 8, Table 11.3

NORWAY

Key Economic Indicators

(Millions of Norwegian Krone (NOK) unless otherwise noted)

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1/ Estimate.
2/ 1-Month NI BOR.
3/ National Saving/National Disposable Income.
47 Gross Fixed Investment/GDP.
5/ Norwegian Foreign Trade Statistics.
6/ End-Year Foreign Assets Minus Foreign Liabilities.
77 Total Interest & Principal Paid On Long-Term Debt by
Private and Public Sector.

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Energy remains Norways predominant resource base, with no major changes expected in the next decade. Offshore the country has crude oil reserves sufficient to last over 20 years and enough natural gas to last nearly 100 years. On the mainland the availability of abundant hydropower supports energy intensive industries such as metals and fertilizers.

In late 1991, Norway, with the other EFTA countries, reached agreement with the European Community to establish closer economic ties through the creation of a new European Economic Area (EEA). Although the European Court of Justice considers some of the elements of that agreement in violation of the Treaty of Rome, EFTA and EC negotiators are working to save the agreement. The EEA is scheduled to become effective on January 1, 1993. Participation in the EEA will require Norway to comply with a wide range of EC directives and regulations.

The small size of the population limits Norway's human resource base; a highly centralized collective bargaining process and a restrictive immigration policy limit its flexibility in increasing industrial competitiveness.

The petroleum sector and associated service industries will likely remain the engine of economic growth for the next several decades. Energy-intensive manufacturing industries will also remain pro inent. Several inefficient sectors producing for the domestic market survive largely through generous subsidies. These will likely experience a painful period of adjustment in the years ahead as the Government adapts to the emerging EC single market, regardless of its final decision on EC membership.

Norway and the other EFTA countries recently negotiated an economic cooperation agreement with the EC under the framework of the European Economic Area. There is increasing speculation in business and political circles that Norway will eventually join the flock of those countries submitting an application for EC membership. Norway is currently deeply divided over the issues.

The Norwegian welfare state which redistributes a large share of the national income through taxes and subsidies. State intervention in the economy is significant. The two dominant industrial groups, Statoil and Norsk Hydro, remain state controlled. Moreover, restrictions are maintained on foreign ownership of Norwegian industry, including financial institutions. Looking ahead in the 1990's, it is realistic to expect some lessening of government intervention and control as Norway harmonizes its policies to be more in tune with the EC.

The government's dependence on petroleum revenue increased substantially over the past decade. On the expenditure side the most significant development was a rise in subsidies and social programs, financed by petroleum revenues. In 1986 budgetary pressures increased because of slumping oil prices. The subsequent recession prompted stimulatory fiscal policy. Despite the rebound in world oil

NORWAY

prices, the budget deficit increased significantly between, 1986 and 1991.

No general tax incentives exist to promote investment, although tax credits and government grants are offered to encourage investment in northern Norway. Accelerated depreciation allowances and subsidized power are available to industry. The Government of Norway will continue with its tax reform program in 1992, but the overall tax burden will remain roughly unchanged.

The Government of Norway controls the growth of the money supply through reserve requirements imposed on banks, open market operations, and variations in the Central Bank discount rate. The Government strives to maintain a stable exchange rate, thereby limiting its ability to use the money supply as an independent policy instrument.

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Norway is not a member of the European Monetary System but, effective October 22, 1990, the Norwegian Krone (NOK) was pegged to the European Currency Unit (ECU), the common currency unit of the EC. Prior to this move, the NOK was pegged to a trade-weighted basket of currencies in which the weight of the U.S. dollar accounted for 11 percent. The new foreign exchange rate system broke the direct link between the NOK and the U.S. dollar. The NOK is expected to fluctuate less against the major EC currencies and more against the dollar. Norwegian interest rates and inflation will tend to move toward EC levels under the new regime, and the scope of discretionary monetary policy will likely be reduced.

Norway dismantled most remaining foreign exchange controls in 1990. U.S. companies operating here have never reported problems in remitting payments.

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Norway remains highly dependent on its offshore oil and gas sector. Many parts of the mainland economy are protected and inefficient. Nevertheless, several significant reforms have been implemented in the past three years. Quantitative restrictions on credit flow from private financial institutions were abolished in 1987 and 1988 and, as noted above, most foreign exchange controls were dismantled in 1990.

A new legal framework for the functioning of the financial system was adopted in 1988, strengthening competitive forces in the market and bringing capital adequacy ratios more in line with those abroad. Despite progress, the Norwegian banking industry continues to struggle with structural problems, bad loan portfolios and overstaffing, which will likely require further corrective action.

Over the past three years, limited income tax reform has lowered personal income tax rates and broadened the tax base. Some progress has been made in reducing subsidies to Norwegian industry but there remains much room for further reform.

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