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Norwegian government worried by chocolate price drop

Chocolate prices in Norway have fallen by more than 17 percent in six years, while healthier foods have increased in price.

Published: 11 February 2023 15:34 CET
Chocolate
Photo by Denny Müller on Unsplash

The Norwegian government is now considering several measures to address the situation – including new taxes.

“It is very worrying that unhealthy foods are becoming cheaper while healthy foods are becoming more expensive. We know that this is bad for public health,” State Secretary Ole Henrik Krat Bjørkholt in the Ministry of Health told the news bureau NTB.

Figures from Statistics Norway (SSB) show that the price of chocolate in Norway has been falling for several years.

When the sugar tax was removed in 2021, the fall was particularly sharp, but prices were also low in the years before the tax decision. However, in December last year, chocolate reached its lowest price level since 2016.

“The market controls the prices of food. But we want to promote healthy choices, and that it is easier (for people) to choose healthy (option),” Bjørkholt added.

The government is currently working on the Public Health Report, which will come out this spring, and the report is likely to address this issue.

“We have received several suggestions about introducing measures to make it easier for consumers to make healthy choices, including the introduction of taxes. This is being assessed,” Bjørkholt noted.

The Solberg government removed the tax on chocolate and sugar products in 2021 at the initiative of the Progress Party (FRP).

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ECONOMY

‘Turning point’: What the future holds for Norway’s economy

The standstill in Norway's economy may soon be at an end, according to a new report from Norway's national data agency. The agency isn't alone in its optimistic outlook, as the country's PM has said the country is at a 'turning point'.

Published: 14 June 2024 11:19 CEST
'Turning point': What the future holds for Norway's economy

Norway’s economy should begin to pick up in the coming months and years after a period of stagnation, according to a national data agency, Statistics Norway, in a forecast on the Norwegian economy.

“With lower interest rates and clear wage growth, household consumption will increase. Economic activity will also pick up as a result of increased public consumption and an increase in housing investment,” said Thomas von Brasch, head of research at Statistics Norway.

The stagnation would likely continue for the rest of 2024 before picking up in 2025 and returning to a more neutral position in 2026.

“The standstill in the Norwegian economy is soon over,” von Brasch said.

After a period of high inflation, peaking at 7.5 percent in October 2022, price rises have begun to moderate. During this period, inflation in Norway was at its highest level since the 1980s.

This is good news for those hoping for lower interest rates, as the central bank had raised rates rapidly to try and control inflation and get it towards a target of two percent.

“Lower inflation at our trading partners will cause inflation here at home to continue to fall. Reduced interest rates internationally also contribute to the policy rate being gradually cut in Norway,” von Brasch said.

After the latest inflation figures for Norway were released, many economists predicted that the first cut would arrive around December. Between May 2023 and May 2024, inflation was measured at 3 percent.

READ ALSO: What Norway’s latest inflation figures mean for your finances

Market rates, the interest rates consumers pay, are expected to fall from around 4.7 percent this year, to 4 percent next year, and 3.5 percent the year after.

Norway’s PM, Jonas Gahr Støre, said the Norwegian economy was at a “turning point”, with the future looking much more positive for those in Norway.

“It is good news for people’s finances and clearly confirms that we are at a turning point in the economy where people can get better advice. Statistics Norway estimates that price growth will continue downward, so interest rates can eventually be lowered. They also expect increased purchasing power for people this year and in the following years. The government aims for people to get better advice,” PM Jonas Gahr Støre told Norwegian newswire NTB.

One factor that had the researchers at Statistics Norway more uncertain was the development of the Norwegian krone.

“The development in the krone exchange rate is important for inflation, among other things through import prices measured in Norwegian kroner. There is great uncertainty surrounding exchange rate movements,” the report read.

However, it added that keeping exchange rates the same in the coming years could be considered a positive development. This may disappoint those who have been negatively affected by a weakened krone.

Still, there was much better news when it comes to wages. Over the past eight years wages have barely grown in real terms, meaning price increases have outpaced wages. Workers in Norway can look forward to real wage increases of around 1.5 percent until 2027.

Unemployment would rise slightly in the coming years, though, from 4 percent currently to 4.2 percent in 2025.

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