Attachmate

Attachmate is a software company owned by an investment group led by Francisco Partners, Golden Gate Capital, and Thoma Cressey Bravo. Attachmate focuses on terminal emulation, legacy modernization, managed file transfer, and enterprise fraud management software. It is the largest privately owned software company in Washington, USA.

Type Private

Industry Computer software

technology services

Founded Bellevue, Washington, 1981

Headquarters Seattle, Washington

Key people Jeff Hawn, President and CEO;

Bob Flynn, SVP Global Sales and GM 

Host Connectivity Solutions;

Charles Sansbury, CFO;

Logan Wray, SVP Acquisitions, GM NetIQ BU

Products Terminal Emulator Software,

Interoperability Software,

Security Software

Website http://www.attachmate.com

Products

The Attachmate logo on older software products.

As a result of the mergers and acquisitions detailed below, Attachmate has broadened its solution set to include several brands:

Terminal Emulation

Attachmate develops a variety of Terminal emulators:

Reflection (IBM, HP, UNIX, OpenVMS, X)

EXTRA! (IBM, UNIX, OpenVMS)

INFOConnect (Unisys)

Systems and Security Management

The NetIQ business unit delivers systems and security management software.

Among the NetIQ product offerings is AppManager, a suite that provides network, applications and systems monitoring. The product includes monitoring support Microsoft operating systems, Microsoft SQL Server databases, a variety of messaging environments, UNIX and Linux operating systems, Oracle systems, and Voice-over-IP for Cisco, Nortel, and Avaya.

Secure Communications

Reflection for Secure IT, formerly F-Secure SSH, is an SSH (secure shell) client and server for Windows and UNIX.

Application Integration

Attachmate Verastream provides application integration tools that quickly and noninvasively service-enable mainframe and enterprise host data and logic.

Attachmate DATABridge is an extract, transform, load (ETL) solution for securely integrating Unisys DMSII and non-DMSII data to a secondary database such as Oracle or Microsoft SQL Server.

PC X Server

Reflection X allows Windows users to use graphical and command-line based applications on remote UNIX, Linux, and OpenVMS hosts.

History

 Attachmate Corporation

Attachmate, founded in 1982 by Frank W. Pritt and Tom Borkowski, focused initially on the IBM terminal emulation market, and became a major technology employer in the Seattle area. Based in Bellevue, Washington, the company became one of the largest PC software companies in the world, with offices in more than 50 cities in North America and in 30 countries. The company made several acquisitions, through mergers and purchases, to expand its range of host access hardware and software solutions. Its products and the company itself won numerous awards, including being named one of the “Best Companies to Work For” by Washington CEO magazine.

Attachmate served 80% of Fortune 500 and Global 2000 companies, with over 13 million users worldwide. Attachmate's major development locations included their headquarters in Bellevue, an office in Bellingham, Washington, and a facility in Cincinnati, Ohio. In the early days, Attachmate focused on 3270 emulation for PCs with some hardware 3270 boards as well. Attachmate invested heavily in its sales and marketing organization worldwide in the early 90s and quickly grew its market share from 3rd in the host-connectivity market to 1st with its EXTRA! Personal Client product. The company continued to grow organically as well as through acquisition of KEA Systems (makers of KEAterm VT340 and VT420 terminal emulators, and KEA X x terminal software), and DCA (makers of IRMA line of emulators, INFOconnect, Crosstalk communications software, and OpenMind collaborative software). Later, the company also acquired The Wollongong Group (makers of Pathway TCP and Emissary).

After the acquisition of DCA, the company quickly dominated the 3270, 5250 and VT marketplace, and built its revenues in excess of $400 million in 1995 - as compared to roughly $40M just five years earlier. A Senior Management transition led by incoming CEO Jim Lindner made an attempt to create a unified product strategy and take the company public. The strategy received positive reviews from customers and the press initially but eventually stalled as a clash between Pre and Post DCA-merger management destabilized product development and Frank Pritt took back the helm in July 1996.

Bill Boisvert, formerly of Paccar, was the next president from January 1998 until his resignation in October 2000 after a year of layoffs and flat revenue growth.

The next stage of its history was marked by tight fiscal management and managing to the bottom line. As revenues were impacted through the bursting tech bubble after 2001, Attachmate was hit with successive rounds of layoffs. In 2001, the Burnaby development center was closed; in June 2002 the Cincinnati development center was closed and the company's VP of Development was fired.

On April 18, 2005, it was announced that three investment companies, Golden Gate Capital, Francisco Partners, and Thoma Cressey Equity Partners, would buy Attachmate. Attachmate would be merged with long-time competitor WRQ, whom the investors had bought previously.

Attachmate no longer sells or supports 3270 IRMA, SDLC, or ISCA SDLC hardware adapters, or provides driver downloads. In February of 2007, they sold their remaining hardware inventory to Alpine Computer Systems, a legacy equipment reseller, and refers customers to them for sales and service on hardware adapters and drivers.

WRQ, Inc.

In 1981, Doug Walker, Mike Richer and Marty Quinn founded Walker, Richer & Quinn (WRQ) to integrate microcomputers with existing IT environments. The company set its sights on the Hewlett-Packard market, launching the first commercially viable terminal emulator for the HP 3000. Based in Seattle, Washington, WRQ was one of the 20 largest software companies, and consistently ranked in Fortune magazine’s “100 Best companies to Work for in America,” and Washington CEO magazine’s “Best Companies to Work For.”[when?]

On December 6, 2004, it was announced that WRQ had been purchased by an investment group.

Attachmate and WRQ merger

After buying both WRQ, Inc. and Attachmate Corporation, who had been long-time competitors in the host emulation business, it was announced that the companies would be merged. On June 1, 2005, the deal closed, and the new company was named AttachmateWRQ.

In June 2005, shortly after the merger was made official, AttachmateWRQ announced that its corporate headquarters would be located in WRQ's Seattle, Washington location. The vacated headquarters of Attachmate in the Factoria neighborhood of Bellevue, Washington were quickly filled by T-Mobile, who already occupied part of the building.

The company continued to support both Attachmate and WRQ product sets (which overlap in many cases) until products could be merged or replaced.

NetIQ Acquisition

NetIQ, founded in 1995 by Ching-Fa Hwang, Her-daw Che, Hon Wong, Ken Prayoon Cheng and Thomas R. Kemp, was a company that provided systems management and security management software. It provided businesses worldwide with solutions to monitor, analyze, and optimize the performance, availability, and security of IT infrastructure. Its flagship products included AppManager and Security Manager. The company headquarters were in San Jose, California, with about 900 employees worldwide. Their Nasdaq ticker symbol was NTIQ.

NetIQ's toolset included systems, security, VoIP and Administration software.

On April 27, 2006, AttachmateWRQ announced an agreement to acquire NetIQ for about 495 million USD, and that the deal would close in 90 days. NetIQ would be merged into AttachmateWRQ, creating a single company with $400 million annual revenue and over 40,000 customers in 60 countries. On June 20, they announced that NetIQ shareholders had approved this purchase, and the acquisition would be complete by the end of that month. 

On July 5, 2006, both companies released a press release announcing the closing of the deal. The new company would do business under the name Attachmate Corporation.

 OnDemand Acquisition and Sale

On March 7, 2006, AttachmateWRQ announced that they had acquired OnDemand Software. OnDemand Software develops an award-winning product called WinINSTALL, which is for desktop management in IT environments. This product is similar to AttachmateWRQ's existing NetWizard product. The high-quality WinINSTALL product combined with AttachmateWRQ's global sales presence provides significant opportunities for the company.

However, on June 30, 2008, Scalable Software announced in a press release that they had acquired the WinINSTALL business unit (substantially all assets of the former OnDemand) from Attachmate. WinINSTALL was the desktop management suite previously acquired by Attachmate from OnDemand Software.

CEO Controversy

Jeff Hawn—the president and CEO of Seattle-based Attachmate who lives in Austin, Texas—has been sentenced to 10 days in jail for authorizing the slaughter of 32 of his neighbor's bison that wandered onto his Colorado ranch. Hawn pleaded guilty in November to criminal mischief and animal cruelty. Hawn and hired hands shot and killed 32 bison, which had wandered onto and near his property from a neighboring ranch in Park County, Colorado — including cows carrying calfs. In Colorado, bison are allowed to wander under open-range laws.

The arrest warrant said most were left to rot.

Hawn, plead guilty to criminal mischief and cruelty to animals and was released free on a $15,000 bail. The Denver Post reports that the judge sentenced Hawn to 10 days in jail.

 Novell Acquisition

Novell announced in November 2010 that it had agreed to be aquired by Attachmate for $2.2 billion. Attachmate plans to operate Novell as two units, one being SUSE. Certain intellectual property assets are planned to be sold to a consortium of companies led by Microsoft.

(source:wikipedia)

Economy of Belgium

The modern, private enterprise economy of Belgium has capitalized on its central geographic location, highly developed transport network, and diversified industrial and commercial base. The first country to undergo an industrial revolution on the continent of Europe in the early 19th century, Belgium developed an excellent transportation infrastructure of ports, canals, railways, and highways to integrate its industry with that of its neighbors. Industry is concentrated mainly in the populous Flanders in the north, around Brussels and in the 2 biggest Walloon cities, Liège and Charleroi, along the sillon industriel. Belgium imports raw materials and semi-finished goods that are further processed and re-exported. Except for its coal, which is no longer economical to exploit, Belgium has virtually no natural resources. Nonetheless, most traditional industrial sectors are represented in the economy, including steel, textiles, refining, chemicals, food processing, pharmaceuticals, automobiles, electronics, and machinery fabrication. Despite the heavy industrial component, services account for 74.9% of GDP, while agriculture accounts for only 1% of GDP.

With exports equivalent to over two-thirds of GNP, Belgium depends heavily on world trade. Belgium's trade advantages are derived from its central geographic location and a highly skilled, multilingual, and productive work force. One of the founding members of the European Community, Belgium strongly supports deepening the powers of the present-day European Union to integrate European economies further. About three-quarters of its trade is with other EU countries.

Belgium's public debt is about 99% of GDP. The government succeeded in balancing its budget during the 2000-2008 period, and income distribution is relatively equal. Belgium began circulating the euro currency in January 2002. Economic growth and foreign direct investment dropped in 2008. In 2009 Belgium is likely to have negative growth, growing unemployment, and a 3% budget deficit, stemming from the worldwide banking crisis.

Belgian economy in the twentieth century

Evolution of the Belgian GDP

For 200 years through World War I, French-speaking Wallonia was a technically advanced, industrial region, with its industry concentrated along the sillon industriel, while Dutch-speaking Flanders was predominantly agricultural with some industry, mainly processing agricultural products and textiles. This disparity began to fade during the interwar period. When Belgium emerged from World War II with its industrial infrastructure relatively undamaged thanks to the Galopin doctrine, the stage was set for a period of rapid development, particularly in Flanders. The postwar boom years, enhanced by the establishment of the European Union and NATO headquarters in Brussels, contributed to the rapid expansion of light industry throughout most of Flanders, particularly along a corridor stretching between Brussels and Antwerp, which is the second largest port in Europe after Rotterdam.

Foreign investment contributed significantly to Belgian economic growth in the 1960s. In particular, U.S. firms played a leading role in the expansion of light industrial and petrochemical industries in the 1960s and 1970s.

The older, traditional industries of Wallonia, particularly steel industry, began to lose their competitive edge during this period, but the general growth of world prosperity masked this deterioration until the 1973 and 1979 oil price shocks and resultant shifts in international demand sent the economy into a period of prolonged recession. In the 1980s and 1990s, the economic center of the country continued to shift northwards to Flanders with investments by multinationals (Automotive industry, Chemical industry) and a growing local Industrial agriculture (textiles, food).

The early 1980s saw the country facing a difficult period of structural adjustment caused by declining demand for its traditional products, deteriorating economic performance, and neglected structural reform. Consequently, the 1980-82 recession shook Belgium to the core—unemployment mounted, social welfare costs increased, personal debt soared, the government deficit climbed to 13% of GDP, and the national debt, although mostly held domestically, mushroomed.

Against this grim backdrop, in 1982, Prime Minister Martens' center-right coalition government formulated an economic recovery program to promote export-led growth by enhancing the competitiveness of Belgium's export industries through an 8.5% devaluation. Economic growth rose from 2% in 1984 to a peak of 4% in 1989. In May 1990, the government linked the Belgian franc to the Deutsche Mark, primarily through closely tracking German interest rates. Consequently, as German interest rates rose after 1990, Belgian rates have increased and contributed to a decline in the economic growth rate. In 1992-93, the Belgian economy suffered the worst recession since World War II, with the real GDP declining 1.7% in 1993. A boost in business investment and exports provided the economy's impetus for recovery.

On May 1, 1998, Belgium became a first-tier member of the European Monetary Union. Belgium switched from the Belgian franc to the Euro as its currency after January 1, 2002. Belgian per capita GDP ranks among the world's highest. In 2008, the per capita income (PPP) was $37,500. The federal government has managed to present balanced budgets in recent years, but public debt remains high, at 99% of 2009 GDP. GDP growth in 2009 was negative at -1.5%.

While the standard Belgian euro coins designated for circulation show the portrait of King Albert II, this does not happen for commemorative coins, where designs are freely chosen.

Trade

About 80% of Belgium's trade is with fellow EU member states. Given this high percentage, it seeks to diversify and expand trade opportunities with non-EU countries. The Belgian authorities are, as a rule, anti-protectionist and try to maintain a hospitable and open trade and investment climate. The European Commission negotiates on trade issues for all member states, which, in turn lessens bilateral trade disputes with Belgium.

The Belgian Government encourages new foreign investment as a means to promote employment. With regional devolution, Flanders, Brussels, and Wallonia are now courting potential foreign investors and offer a host of incentives and benefits.Foreign companies in Belgium account for approximately 11% of the total work force, with the U.S. share at about 5%. Attracted by the EU 1992 single-market program, many foreign firms and lawyers have settled in Brussels since 1989.

Employment

The social security system, which expanded rapidly during the prosperous 1950s and 1960s, includes a medical system, unemployment insurance coverage, child allowances, invalid benefits, and other benefits and pensions. With the onset of a recession in the 1970s, this system became an increasing burden on the economy and accounted for much of the government budget deficits. The national unemployment figures mask considerable differences between Flanders and Wallonia. Unemployment in Wallonia is mainly structural, while in Flanders it is cyclical. Flanders' unemployment level equals only half that of Wallonia. The southern region continues a difficult transition out of sunset industries (mainly coal and steel), while sunrise industries (chemicals, high-tech, and services) dominate in Flanders.

Belgium's unemployment rate was 6.5% in 2008. A total of 4.99 million people make up Belgium's labor force. The majority of these people (73%) work in the service sector. Belgian industry claims 25% of the labor force and agriculture only 2%. As in other industrialized nations, pension and other social entitlement programs have become a major concern as the baby boom generation approaches retirement.

Budget

Evolution of the Belgian public debt as % of Belgian GDP.

Although Belgium is a wealthy country, public expenditures far exceeded income for many years, and taxes were not diligently pursued. The Belgian Government reacted with poor macroeconomic policies to the 1973 and 1979 oil price hikes by hiring the redundant work force into the public sector and subsidizing industries like coal, steel, textiles, glass, and shipbuilding, which had lost their international competitive edge. As a result, cumulative government debt reached 121% of GDP by the end of the 1980s. However, thanks to Belgium's high personal savings rate, the Belgian Government financed the deficit from mainly domestic savings, minimizing the deleterious effects on the overall economy.

The federal government ran a 7.1% budget deficit in 1992 at the time of the EU's Treaty of Maastricht, which established conditions for Economic and Monetary Union (EMU) that led to adoption of the common Euro currency on January 1, 2002. Among other criteria spelled out under the Maastricht treaty, the Belgian Government had to attain a budget deficit of no greater than 3% of GDP by the end of 1997; Belgium achieved this, with a total budget deficit in 2001 (just prior to implementation of the Euro) that amounted to 0.2% of GDP. The government has balanced the budget every year since, until 2009 where it ran a deficit of about $25 billion. Belgium's accumulated public debt remains high at 99% of 2009 GDP.

Regional differences

The economy of Belgium is varied and cannot be understood without taking the regional differences into account. Indeed, Flemish and Walloon economies differ in many respects (consider for instance Eurostats and OECD statistics), and cities like Brussels, Antwerp, Liège, Bruges, Charleroi or Ghent also exhibit significant differences. In general, productivity in Flanders is roughly 20% higher (per inhabitant) than in Wallonia. Brussels' GDP per capita is much higher than either region, although this is in many ways artificial, as many of those that work in the Brussels-Capital Region live in Flanders or Wallonia. Their output is counted in Brussels and not where they live, artificially raising the per capita GDP of Brussels and slightly lowering that of Flanders and Wallonia.

Unemployment has remained consistently more than twice as high in Wallonia than in Flanders, and even more in Brussels, during most of the last 20 years (2009, Flanders: 5.0% ; Wallonia: 11.2% and Brussels: 15.9%)

Gross Domestic Product in Belgium (2006)

Rank NUTS region 2006 GDP (PPP)

per capita

in Euros % of the average GDP

of EU27 in 2006

1 Brussels 55,100 233.3

2 Flemish Region 27,900 118.0

3 Walloon Region 20,100 85.1

Brussels

Being the de facto European capital, its economy is massively service-oriented. It has a number of regional headquarters of multinational corporations. It is also host to a great number of European institutions, in addition to the Belgian federal government, the government of the Flemish Community and the government of the French Community. Brussels also has many commuters, with 230,000 coming from Flanders, and 130,000 from Wallonia. Much of the success of Brussels is based on the high educational skills of its workforce.

Flanders

A container terminal in the port of Antwerp

The port of Antwerp was in 2004 the second largest European sea port by cargo volume, and the Antwerp freight railway station accounts for one-third of Belgian freight traffic. Antwerp is the first diamond market in the world, diamond exports account for roughly 1/10th of Belgian exports. The Antwerp-based BASF plant is the largest BASF-base outside Germany, and accounts on its own for +/- 2% of Belgian exports. Other industrial and service activities include car manufacturing, telecommunications, photographic products.

The port of Bruges-Zeebrugge is one of the most important, modern and fastest growing ports in Europe. It is Europe's largest port for RoRo traffic and natural gas. It also is the world's largest port for the import and export of new vehicles. Tourism is also a major component of the economy of Bruges. Due to its pristine medieval city centre, Bruges has become a popular tourist destination. Annually about 2.5 million day tourists visit the city and in 2007 there were about 1.4 million overnight stays.

The port of Ghent, in the north of the city, is the third largest port of Belgium. It is accessed by the Ghent-Terneuzen Canal, which ends near the Dutch port of Terneuzen on the Western Scheldt. The port houses, among others, big companies like Arcelor Gent, Volvo Cars, Volvo Trucks, Volvo Parts, Honda, and Stora Enso. The Ghent University, the second largest university of Belgium by number of students, and a number of research oriented companies are situated in the central and southern part of the city. Tourism is increasingly becoming a major employer in the local area. Begonias have been cultivated in the Ghent area since 1860. Belgium is the world's largest producer of begonias, planting 60 million tubers per year. Eighty percent of the crop is exported.

Wallonia

In the past, Liège was one of the most important steel-making centres in Europe. Starting in 1817, John Cockerill extensively developed the iron and steel industry. The industrial complex of Seraing was the largest in the world. Although now a shadow of its former self, steel production and the manufacture of steel goods remain important.

Liège has also been an important centre for gunsmithing since the Middle ages and the arms industry is still strong with the headquarters of FN Herstal. The economy of the region is now diversified, the most important centers are mechanical industries (aircraft engine and Spacecraft propulsion), space technology, information technology, biotechnology and also production of water, beer or chocolate. Liège Science Park south east of the city, near the University of Liège campus, houses spin-offs and high technology businesses. Liège is also a very important llogistic center: the city possesses the third largest river port in Europe, directly connected to Antwerp, Rotterdam and Germany via the Meuse river and the Albert Canal. In 2006 Liège Airport was the 8th most important cargo airport in Europe. A new passenger terminal was opened in 2005. It is also the main hub and the headquarter of TNT Airways.

Charleroi features an industrial area, iron and steel industry, glassworks, chemicals, and electrical engineering. Charleroi is in the center of a vast coal basin, called Pays noir. Many slag heaps still surround the city. Charleroi is also known for its publishing industry with Dupuis, one of the main publishers of Franco-Belgian comics, located in Marcinelle.

(source:wikipedia)

Economy of Norway

The economy of Norway is a developed mixed economy with heavy state-ownership in strategic areas of the economy. Although sensitive to global business cycles, the economy of Norway has shown robust growth since the start of the industrial era. Shipping has long been a support of Norway's export sector, but much of Norway's economic growth has been fueled by an abundance of natural resources, including petroleum exploration and production, hydroelectric power, and fisheries. Agriculture and traditional heavy manufacturing have suffered relative decline compared to services and oil-related industries, and the public sector is among the largest in the world as a percentage of the overall gross domestic product. The country has a very high standard of living compared with other European countries, and a strongly integrated welfare system.

History

Pre-industrial revolution

Prior to the industrial revolution, Norway's economy was largely based on agriculture, timber, and fishing. Norwegians typically lived under conditions of considerable scarcity, though famine was rare. Except for certain fertile areas in Hedemarken and Østfold, crops were limited to hardy grains, such as oats, rye, and barley; and livestock to sheep, goats, cattle, pigs, and some poultry; in places this was complemented with hunting. In areas of Central and Northern Norway, the Sami subsisted on the nomadic herding of reindeer. Fishing all around the coast was dangerous work, though fish such as herring, cod, halibut, and other cold-water species were found in abundance. The introduction of the potato to Norway provided considerable relief for Norwegians.

All around the coast, the harvesting of fish (including cod, herring, halibut, and other cold water species) was an important supplement to farming and was in many areas in the north and west the primary household subsistence. Fishing was typically supplemented with crop-growing and the raising of livestock on small farms.

The economic conditions in Norway did not lend themselves to the formation of feudal system, though several kings did reward land to loyal subjects who became knights. Self-owning farmers were—and continue to be—the main unit of work in Norwegian agriculture, but leading up to the 19th century farmers ran out of land available for farming. Many agricultural families were reduced to poverty as tenant farmers, and served as the impetus for emigration to North America.

Industrial revolution

Capital formation 1865 – 2003 Source: Statistics Norway

Aside from mining in Kongsberg and Røros, industrialization came with the first textile mills that were built in Norway in the middle of the 19th century. But the first large industrial enterprises came into formation when entrepreneurs politics, leading to the founding of banks to serve those needs.

Industries also offered employment for a large number of individuals who were displaced from the agricultural sector. As wages from industry exceeded those from agriculture, the shift started a long-term trend of reduction in cultivated land and rural population patterns. The working class became a distinct phenomenon in Norway, with its own neighborhoods, culture, and politics.

Social democratic reforms and state ownership

Public vs. private consumption Source: Statistics Norway

The roots of the socialist movement in Norway were based on dangerous working conditions, exploitative labor relations policies, and the demand for collective bargaining. As socialism became part of the mainstream labor movement, it also became part of the mainstream political discourse.

The state has large ownership positions in key industrial sectors, such as the strategic petroleum sector (Statoil), hydroelectric energy production (Statkraft), aluminum production (Norsk Hydro), the largest Norwegian bank (DnB NOR) and telecommunication provider (Telenor). The government controls 31.6% of publicly-listed companies. When non-listed companies are included the state has even higher share in ownership (mainly from direct oil license ownership).

After World War II, the Norwegian Labour Party, with Einar Gerhardsen as prime minister, embarked on a number of social democratic reforms aimed at flattening the income distribution, eliminating poverty, ensuring social services such as retirement, medical care, and disability benefits to all, and putting more of the capital into the public trust.

As a result, the public sector grew as a percentage of the overall economy. Highly progressive income taxes, the introduction of value-added tax, and a wide variety of special surcharges and taxes made Norway one of the most heavily taxed economies in the world. Authorities particularly taxed discretionary spending, levying special taxes on automobiles, tobacco, alcohol, cosmetic items, and so on.

Norway's long-term social democratic policies, extensive governmental tracking of information, and the homogeneity of its population lent themselves particularly well for economic study, and academic research from Norway proved to make significant contributions to the field of macroeconomics during this era. When Norway became a petroleum-exporting country, the economic effects came under further study.

Petroleum and post-industrialism

Oil-exporting country

Energy in Norway

Oil production, Norwegian sector; Source: Statistics Norway

In May 1963, Norway asserted sovereign rights over natural resources in its sector of the North Sea. Exploration started on 19 July 1966, when Ocean Traveler drilled its first well. Initial exploration was fruitless, until Ocean Viking found oil on 21 August 1969. By the end of 1969, it was clear that there were large oil and gas reserves in the North Sea. The first oil field was Ekofisk, produced 427,442 barrels (67,957.8 m3) of crude in 1980. Since then, large natural gas reserves have also been discovered.

Against the backdrop of the Norwegian referendum to not join the European Union, the Norwegian Ministry of Industry, headed by Ola Skjåk Bræk moved quickly to establish a national energy policy. Norway decided to stay out of OPEC, keep its own energy prices in line with world markets, and spend the revenue – known as the "currency gift" – wisely. The Norwegian government established its own oil company, Statoil, and awarded drilling and production rights to Norsk Hydro and the newly formed Saga Petroleum.

The North Sea turned out to present many technological challenges for production and exploration, and Norwegian companies invested in building capabilities to meet these challenges. A number of engineering and construction companies emerged from the remnants of the largely lost shipbuilding industry, creating centers of competence in Stavanger and the western suburbs of Oslo. Stavanger also became the land-based staging area for the offshore drilling industry. Presently North Sea is past its peak oil production.

Reservations about European Union

Exports and imports in Norway

On 24 and 25 September 1972, the Norwegian parliament put to a referendum the question whether Norway should join the European Union. The proposal was turned down with a slim margin. The Norwegian government proceeded to negotiate a trade agreement with the EU that would give Norwegian companies access to European markets. Over time, Norway renegotiated and refined this agreement, ultimately joining the European Free Trade Association and the European Economic Area.

Although Norway's trade policies have long aimed at harmonizing its industrial and trade policy with the EU's, a new referendum in 1994 gave the same result as in 1972, and Norway remains one of only two Nordic countries outside the EU, the other being Iceland.

Although much of the highly divisive public debate about EU membership turned on political rather than economic issues, it formed economic policy in several important ways:

Both politicians and the public came to terms with the fact that Norway's economic development was dependent on taking advantage of its comparative advantage by specializing in certain areas for export and relying on import for everything else. This has had a significant effect on Norway's agricultural policy, which has been reshaped to address population patterns rather than self-sufficiency.

The proceeds from oil revenue could not fuel private or public consumption if Norway were to sustain its prosperity when oil reserves run out.

In order to participate in European markets, Norway has had to open its domestic markets to European imports. Although some pricing and distribution issues (e.g., alcohol and automobiles) remain unresolved, Norway's consumer, capital, and employment markets are increasingly approaching those of Europe in general.

Norwegians have sought accommodations on a range of specific issues, such as products from fish farms, agricultural products, emission standards, etc., but these do not appear to differ substantially from those sought by bona fide EU members. It is expected that the issue of membership will be brought to a referendum again at some point.

Post-industrial economic developments

GDP growth 1865–2004

Several issues have dominated the debate on Norway's economy since the 1970s:

Cost of living. Norway is among the most expensive countries in the world, as reflected in the Big Mac Index and other indices. Historically, transportation costs and barriers to free trade had caused the disparity, but in recent years, Norwegian policy in labor relations, taxation, and other areas have contributed significantly.

Competitiveness of "mainland" industries. The high cost of labor and other structural features of the Norwegian environment have caused concern about Norway's ability to maintain its cost of living in a post-petroleum era. There is a clear trend toward ending the practice of "protecting" certain industries (vernede industrier) and making more of them "exposed to competition" (konkurranseutsettelse). In addition to interest in information technology, a number of small- to medium-sized companies have been formed to develop and market highly specialized technology solutions.

The role of the public sector. The ideological divide between socialist and non-socialist views on public ownership has decreased over time. The Norwegian government has sought to reduce its ownership over companies that require access to private capital markets, and there is an increasing emphasis on government facilitating entrepreneurship rather than controlling (or restricting) capital formation. A residual distrust of the "profit motive" persists, and Norwegian companies are heavily regulated, especially with respect to labor relations.

The future of the welfare state. Since World War II, successive Norwegian governments have sought to broaden and extend public benefits to its citizens, in the form of sickness and disability benefits, minimum guaranteed pensions, heavily subsidized or free universal health care, unemployment insurance, and so on. Public policy still favors the provision of such benefits, but there is increasing debate on making them more equitable and needs-based.

Urbanization. For several decades, agricultural policy in Norway was based on the premise of minimal self-sufficiency. In later years, this has given way to a greater emphasis on maintaining population patterns outside of major urban areas. The term "district policy" (distriktspolitikk) has come to mean the demand that old and largely rural Norway is allowed to persist, ideally by providing them with a sustainable economic basis.

Taxation. The primary purpose of the Norwegian tax system has been to raise revenue for public expenditures; but it is also viewed as a means to achieve social objectives, such as redistribution of income, reduction in alcohol and tobacco consumption, and as a disincentive against certain behaviors. Three elements of the tax system seem to attract the most debate:

Progressive taxation. At one time one of the most aggressive in the world, the top marginal tax rate on income has been decreased over time. In addition, Norwegians are taxed for their stated net worth, which some have argued discourages savings.

Value-added tax. The largest source of government revenue. The current standard rate is 25%, food and drink is 14%, and movie theater tickets and public transportation 7%.

Special surcharges and taxes. The government has established a number of taxes related to specific purchases, including cars, alcohol, tobacco, and various kinds of benefits.

Svalbard. People living on Svalbard (Spitsbergen) do not pay taxes, nor is value-added tax collected there. This is mainly because the government wants the island to be more attractive to live on. Although food is more expensive here than at the main land -Mostly caused by the shipping costs, other things like vehicles, tobacco and alcohol are significantly cheaper because of the non-existing taxes. For example, a pack of tobacco that costs around 170 NOK on the mainland, costs around 25–30 NOK here.

Environmental concerns. A number of political issues have had their origins in ecological concerns, including the refineries at Mongstad and the hydroelectric power plant at Alta.

Economic structure and sustained growth

The emergence of Norway as an oil-exporting country has raised a number of issues for Norwegian economic policy. There has been concern that much of Norway's human capital investment has been concentrated in petroleum-related industries. Critics have pointed out that Norway's economic structure is highly dependent on natural resources that do not require skilled labor, making economic growth highly vulnerable to fluctuations in the demand and pricing for these natural resources. The Government Pension Fund of Norway is part of several efforts to hedge against dependence on petroleum revenue.

Norwegian exports in 2006

Because of the oil boom since the 1970s, there has been little extensive government incentive to help develop and encourage new industries in the private sector, in contrast to other Nordic countries like Sweden and particularly Finland. However the last decades have started to see some incentive on national and local government levels to encourage formation of new "mainland" industries that are competitive internationally. In addition to aspirations for a high-tech industry, there is growing interest in encouraging small business growth as a source of employment for the future. In 2006, the Norwegian government formed nine "centers of expertise" to facilitate this business growth.Later in June 2007, the government contributed to the formation of the Oslo Cancer Cluster (OCC) as a center of expertise, capitalizing on the fact that 80% of cancer research in Norway takes place in proximity to Oslo and that most Norwegian biotechnology companies are focused on cancer.

There is continuing debate over the role of the public sector in Norway's economic development. Although there is broad consensus that Norway should pursue a mixed economic model, there is a persistent ideological schism between those who favor free market forces vs. socialist mechanisms.

In 2007, Norway saw a massive 6% growth of its economy, outpacing any other western nation. However, the growth was mostly due to increased consumer demand, and is expected to slow down in 2008.

(source:wikipedia)

Economy of Sweden

The Swedish economy is a developed diverse economy, aided by timber and iron ore. These constitute the resource base of an economy oriented toward foreign trade. The main industries include cars, international communications, pharmaceuticals and forestry.

Because Sweden is in fact a neutral country; during the post world war 2, Sweden did not have to rebuild their economic base, banking system, and country as a whole. Sweden has achieved second to none standard of living, under a mixed system of high-tech markets and welfare benefits. Sweden has the second highest total tax revenue behind Denmark, as a share of the country's income. As of 2007, total tax revenue was 47.8% of GDP, down from 49.1% 2006.

History

In the 19th century Sweden evolved from a largely agricultural economy into the beginnings of an industrialized, urbanized country. Poverty was still widespread in sections of the population. However, incomes were sufficiently high to finance emigration to distant places, prompting a large portion of the country to leave, especially to the USA.

Economic reforms and the creation of a modern economic system, banks and corporations were enacted during the latter half of the 19th century. By the 1930s, Sweden had one of Europe's highest standards of living. Sweden declared itself neutral during both world wars, thereby avoiding much physical destruction like several other neutral countries.

The post-war boom propelled Sweden to greater economic prosperity, putting the country in third place in per capita GDP rankings by 1970. Beginning in the 1970s and culminating with the deep recession of the early 1990s, Swedish standards of living developed less favorably than many other industrialized countries. Since the mid 1990s the economic performance has improved.

In 2006, Sweden had the world's ninth highest GDP per capita in nominal terms and was in 14th place in PPP terms (2009 figures).

Crisis of the 1990s

Sweden has had a unique economic model in the post-World War II era, characterized by close cooperation between the government, labour unions and corporations. The Swedish economy has extensive and universal social benefits funded by high taxes, close to 50% of GDP. In the 1980s, a real estate and financial bubble formed, driven by a rapid increase in lending. A restructuring of the tax system, in order to emphasize low inflation combined with an international economic slowdown in the early 1990s, caused the bubble to burst. Between 1990 and 1993 GDP went down by 5% and unemployment skyrocketed, causing the worst economic crisis in Sweden since the 1930s. In 1992 there was a run on the currency, the central bank briefly jacking up interest to 500% in an unsuccessful effort to defend the currency's fixed exchange rate.

 Total employment fell by almost 10% during the crisis.

A real estate boom ended in a bust. The government took over nearly a quarter of banking assets at a cost of about 4% of the nation's GDP. This was known colloquially, as the "Stockholm Solution". The United States Federal Reserve remarked in 2007, that "In the early 1970s, Sweden had one of the highest income levels in Europe; today, its lead has all but disappeared... So, even well-managed financial crises don't really have a happy ending."

The welfare system that had been growing rapidly since the 1970s couldn't be sustained with a falling GDP, lower employment and larger welfare payments. In 1994 the government budget deficit exceeded 15% of GDP. The response of the government was to cut spending and institute a multitude of reforms to improve Sweden's competitiveness. When the international economic outlook improved combined with a rapid growth in the IT sector, which Sweden was well positioned to capitalize on, the country was able to emerge from the crisis

The crisis of the 1990s was by some viewed as the end of the much buzzed welfare model called "Svenska modellen", literally The Swedish Model, as it proved that governmental spending at the levels previously experienced in Sweden was not long term sustainable. Much of the Swedish Model's acclaimed advantages actually had to be viewed as a result of the post WWII special situation, which left Sweden untouched when competitors' economies were in pieces.

However, the reforms enacted during the 1990s seem to have created a model in which extensive welfare benefits can be maintained in a global economy.

Contemporary economy

Real GDP growth in Sweden 1996-2006.

Sweden is an export-oriented mixed economy featuring a modern distribution system, excellent internal and external communications, and a skilled labor force. Timber, hydropower and iron ore constitute the resource base of an economy heavily oriented toward foreign trade. Sweden's engineering sector accounts for 50% of output and exports. Telecommunications, the automotive industry and the pharmaceutical industries are also of great importance. Agriculture accounts for 2 percent of GDP and employment.

The 20 largest Sweden-registered companies by turnover in 2007 were Volvo, Ericsson, Vattenfall, Skanska, Sony Ericsson Mobile Communications AB, Svenska Cellulosa Aktiebolaget, Electrolux, Volvo Personvagnar, TeliaSonera, Sandvik, Scania, ICA, Hennes & Mauritz, Nordea, Preem, Atlas Copco, Securitas, Nordstjernan and SKF. Sweden's industry is overwhelmingly in private control; unlike some other industrialized Western countries, such as Austria and Italy, state owned enterprises were always of minor importance.

Some 4.5 million residents are working, out of which around a third with tertiary education. GDP per hour worked is the world's 9th highest at 31 USD in 2006, compared to 22 USD in Spain and 35 USD in United States. According to OECD, deregulation, globalization, and technology sector growth have been key productivity drivers. GDP per hour worked is growing 2½ per cent a year for the economy as a whole and trade-terms-balanced productivity growth 2%. Sweden is a world leader in privatized pensions and pension funding problems are small compared to many other Western European countries. Swedish labor market has become more flexible, but it still has some widely acknowledged problems. The typical worker receives only 40% of his income after the tax wedge. The slowly declining overall taxation, 51.1% of GDP in 2007, is still nearly double of that in the United States or Ireland. Civil servants amount to a third of Swedish workforce, multiple times the proportion in many other countries. Overall, GDP growth has been fast since reforms in the early 1990s, especially in manufacturing.

World Economic Forum 2008 competitiveness index ranks Sweden 4th most competitive, behind Denmark. The Index of Economic Freedom 2008 ranks Sweden the 27th most free out of 162 countries, or 14th out of 41 European countries. Sweden ranked 9th in the IMD Competitiveness Yearbook 2008, scoring high in private sector efficiency. According to the book, The Flight of the Creative Class, by the U.S. urban studies, Professor Richard Florida of University of Toronto, Sweden is ranked as having the best creativity in Europe for business and is predicted to become a talent magnet for the world’s most purposeful workers. The book compiled an index to measure the kind of creativity it claims is most useful to business — talent, technology and tolerance.Sweden's investment into research and development stood, in 2007, at over 3.5% of GDP. This is considerably higher than that of a number of MEDCs, including the United States, and is the largest among the OECD members.

Sweden rejected the Euro in a referendum in 2003, and Sweden maintains its own currency, the Swedish krona (SEK). The Swedish Riksbank—founded in 1668 and thus making it the oldest central bank in the world—is currently focusing on price stability with its inflation target of 2%. According to Economic Survey of Sweden 2007 by OECD, the average inflation in Sweden has been one of the lowest among European countries since the mid-1990s, largely because of deregulation and quick utilization of globalization.

The largest trade flows are with Germany, United States, Norway, United Kingdom, Denmark and Finland.

The Swedish economic picture has brightened significantly since the severe recession in the early 1990s. Growth has been strong in recent years, and even though the growth in the economy slackened between 2001 and 2003, the growth rate has picked up since with an average growth rate of 3.7% in the last three years. The long-run prospects for growth remain favorable. The inflation rate is low and stable, with projections for continued low levels over the next 2–3 years.

Since the mid-1990s the export sector has been booming, acting as the main engine for economic growth. Swedish exports also have proven to be surprisingly robust. A marked shift in the structure of the exports, where services, the IT industry, and telecommunications have taken over from traditional industries such as steel, paper and pulp, has made the Swedish export sector less vulnerable to international fluctuations. However, at the same time the Swedish industry has received less money for its exports while the import prices have gone up. During the period 1995-2003 the export prices were reduced by 4% at the same time as the import prices climbed by 11%. The net effect is that the Swedish terms-of-trade fell 13%.

Government

The government budget has improved dramatically from a record deficit of more than 12% of GDP in 1993. In the last decade, from 1998 to present, the government has run a surplus every year, except for 2003 and 2004. The surplus for 2007 is expected to be 138 billion ($20b) kronor. The new, strict budget process with spending ceilings set by parliament, and a constitutional change to an independent Central Bank, have greatly improved policy credibility. This can be seen in the long-term interest rate margin versus the Euro, which is negligible.

From the perspective of longer term fiscal sustainability, the long-awaited reform of old-age pensions entered into force in 1999. This entails a far more robust system vis-à-vis adverse demographic and economic trends, which should keep the ratio of total pension disbursements to the aggregate wage bill close to 20% in the decades ahead. Taken together, both fiscal consolidation and pension reform have brought public finances back on a sustainable footing. Gross public debt, which jumped from 43% of GDP in 1990 to 78% in 1994, stabilised around the middle of the 1990s and started to come down again more significantly beginning in 1999. In 2000 it fell below the key level of 60% and had declined to a level of 37% of GDP as of 2007.

Economic and monetary union

Current economic development reflects a quite remarkable improvement of the Swedish economy since the crisis in 1991-93, so that Sweden could easily qualify for membership in the third phase of the Economic and Monetary Union of the European Union, adopting the euro as its currency. In theory, by the rules of the EMU, Sweden is obliged to join, since the country has not obtained exception by any protocol or treaty (as opposed to Denmark and the United Kingdom). Nevertheless, the Swedish government decided in 1997 against joining the common currency from its start on 1 January 1999. This choice was implemented by exploiting a legal loophole, deliberately staying out of the European Exchange Rate Mechanism. This move is currently tolerated by the European Central Bank, which however has warned that this wouldn't be the case for newer EU members.

In the first years of the twenty-first century, a majority for joining emerged in the governing Social Democratic party, although the question was subject of heated debate, with leading personalities in the party on both sides. On 14 September 2003, a national referendum was held on the euro. A 56% majority of Swedes rejected the common currency, while 42% voted in favour of it. Currently no plans for a new referendum or parliamentary vote on the matter are being discussed, though it has been implied that another referendum may take place in around ten years.

Unemployment

In contrast with most other European countries, Sweden maintained an unemployment rate around 2% or 3% of the work force throughout the 1980s.[citation needed] This was, however, accompanied by high and accelerating inflation. It became evident that such low unemployment rates were not sustainable, and in the severe crisis of the early 1990s the rate increased to more than 8%. In 1996 the government set out a goal of reducing unemployment to 4% by 2000. During 2000 employment rose by 90,000 people, the greatest increase in 40 years, and the goal was reached in the autumn of 2000. The same autumn the government set out its new target: that 80% of the working age population will have a regular job by 2004. Some have expressed concern that meeting the employment target may come at a cost of too high a rate of wage increases hence increasing inflation. However, as of August 2006, roughly 5% of working age Swedes were unemployed, over the government-established goal. However, some of the people who cannot find work are put away in so-called "labour market political activities", referred to as "AMS-åtgärder".

According to Jan Edling, a former trade-unionist, the actual number of unemployed is far higher, and those figures are being suppressed by both the government and the Swedish Trade Union Confederation. In Edling's report he added that a further 3% of Swedes were occupied in state-organised job schemes, not in the private sector. He also claimed a further 700,000 Swedes are either on long-term sick leave or in early retirement. Edling asks how many of these people are in fact unemployed. According to his report, the "actual unemployment" rate hovers near 20%.= Some critics disagree with this concept of "actual" unemployment, also termed "broad unemployment", since they do not see e.g. students who rather want a job, people on sick leave and military conscripts as "unemployed".=

According to Swedish Statistics, unemployment in May 2009 was 9% in the general population and 30% amongst 15-25 years old.

Trade unions

Around eighty percent of the Swedish labour force is unionised. For most unions there is a counterpart employer's organization for businesses. The unions and employer organisations are independent of both the government and political parties, although the largest confederation of unions, the National Swedish Confederation of Trade Unions or LO (organising blue-collar workers), maintains close links to the largest political party, the Social Democrats. So close that after the election in 2006 and the resignation of the party leader Göran Persson, one of the strongest candidates for new party leader (and their candidate as Prime Minister) was the LO chairman Wanja Lundby-Wedin.

The unionisation rate among white-collar workers is exceptionally high in Sweden - almost as high as for blue-collar workers. There are two major confederations that organise professionals and other qualified employees: the Swedish Confederation of Professional Employees (Tjänstemännens Centralorganisation or TCO) and the Swedish Confederation of Professional Associations (Sveriges Akademikers Centralorganisation or SACO). They are both independent from Sweden's political parties and never endorse candidates for office in political elections.

There is no minimum wage that is required by legislation. Instead, minimum wage standards in different sectors are normally set by collective bargaining. Most labour contracts were re-negotiated during 2004, and call for wage increases of around seven percent over a three-year period.

Labor force

The traditionally low-wage differential has increased in recent years as a result of increased flexibility as the role of wage setting at the company level has strengthened somewhat. Still, Swedish unskilled employees are well-paid while well-educated Swedish employees are low-paid compared to those in competitor countries in Western Europe and USA. The average increases in real wages in recent years have been high by historical standards, in large part due to unforeseen price stability. Even so, nominal wages in recent years have been slightly above those in competitor countries. Thus, while private-sector wages rose by an average annual rate of 3.75% from 1998 to 2000 in Sweden, the comparable increase for the EU area was 1.75%. In the year 2000 the total labour force was around 4.4 million people.

Ongoing privatisations

The Swedish government has announced that it will privatise a number of wholly and partly state owned companies. "The income from these sales will be used to pay off the government debt and reduce the burden of debt for future generations. The Government's ambition is to sell companies to a value of SEK 200 billion during 2007-2010."

Apoteket - pharmaceuticals. To be partially sold when breaking up the state monopoly and opening the market to free competition. 

Nordea - bank. 19.5% owned by Swedish government.

OMX - stock exchange. Shares sold to Borse Dubai for 2.1 billion SEK.

Telia Sonera - telecom. 37.3% owned by the Swedish government. Hitherto SEK 18 billion worth of shares has been sold reducing state ownership from 45.3% to 37.3%.

SBAB - finance.

Vin & Sprit. Sold to Pernod Ricard for 5.626 billion Euro.

Vasakronan. Sold to AP-fastigheter for 4.3 billion Euro.

Gross regional product

Gross Regional Product per capita in thousands of Swedish crowns (2004)

The gross regional product differs from a top of 363 000 SEK in the capital Stockholm County, where much of the economic activity is centered, to 202 000 SEK in Södermanland County, with an average of 263 000 SEK for the whole country.

The extra regional figure refers to parts of the economic territory which cannot be attached directly to a single region, e.g. embassies and consulates.

Table showing GRP per capita

Rank County Total¹ Per capita² Share

1 Stockholm County 669 900 363 000 28.54%

2 Västra Götaland County 386 538 257 000 16.47%

3 Västernorrland County 61 540 251 000 2.62%

4 Kronoberg County 43 256 245 000 1.84%

5 Skåne County 278 254 244 000 11.85%

6 Jönköping County 79 761 243 000 3.40%

jt. 7 Östergötland County 97 387 236 000 4.15%

jt. 7 Norrbotten County 59 875 236 000 2.55%

9 Uppsala County 69 631 234 000 2.97%

10 Västmanland County 60 287 233 000 2.57%

11 Blekinge County 34 566 231 000 1.47%

12 Kalmar County 53 381 227 000 2.27%

13 Dalarna County 62 604 226 000 2.67%

14 Örebro County 61 203 224 000 2.61%

15 Halland County 61 339 221 000 2.61%

jt. 16 Gävleborg County 60 417 218 000 2.57%

jt. 16 Västerbotten County 55 534 218 000 2.37%

18 Värmland County 59 497 217 000 2.53%

19 Jämtland County 27 628 215 000 1.18%

20 Gotland County 12 154 212 000 0.52%

21 Södermanland County 52 235 202 000 2.23%

Extra regional 413 0.02%

Total 2 347 400 263 000 100.00%

1/ Million SEK

2/ SEK

Source: Statistics Sweden (2004)

(source:wikipedia)