Doublethink: The two faces of Norway’s foreign and development policy

January 2010

New report written for Forum for Environment and Development, Oslo.

To read the full report click here

SUMMARY

Government officials and ordinary Norwegians tend to see Norway as a small but influential country that often sets international standards for ethical behaviour and that does good in the world. But how real is this benign image and how ethical is Norway’s foreign and development policy in practice, both compared to its declared policy and to other countries? This report looks at some key Norwegian foreign and development policies, some of which are controversial in terms of their impacts on poverty reduction and development.

It finds:

• The government’s Pension Fund, although having established ethical criteria and excluded some companies from its portfolio, continues to invest in numerous companies abusing human rights and the environment. Neither is the Fund noticeably more ethical than several other investment funds.

• Norway’s oil industry, which is contributing massively to domestic wealth, is increasingly active in states abusing human rights. Despite some positive environmental policies, Norway is also a major, and increasing, emitter of greenhouse gases contributing  to global warming. Norway’s environmental aid is insufficient to compensate for this impact.

• Norway has a growing arms industry which, despite greater restrictions on exports than in other countries, still enables Norwegian arms to end up being used by NATO allies in offensive operations overseas. Norwegian military equipment is still exported to a small number of human rights abusers.

• Numerous Norwegian companies, including state-owned enterprises, are involved in human rights or environmental abuses overseas but the government is failing to clarify or establish legally-binding mechanisms to hold corporations to account for their impacts. The government’s faith in voluntary mechanisms to improve corporate behaviour goes against United Nations calls for improved global governance that are being supported by Norwegian aid.

• Norway has taken positive steps to press the World Bank to stop imposing privatisation and liberalization conditions on developing countries, but these have not been matched by a switch away from backing the World Bank’s ‘private sector development’ model. Rather, Norway continues to promote privatization processes from which its own energy companies, in particular, are benefitting.

Norway has taken a genuine and important ethical lead on some international policy issues and it is these that, not surprisingly, its ministers stress and that the rest of the world often notices. But the list of unethical policies is also long and becoming longer. The leitmotif in Norway’s unethical behaviour concerns the promotion of business interests and the failure to restrain and direct  them towards promoting human rights. In this respect, Norway has become little different to other rich countries exploiting the planet for their own benefit.

Norwegian ministers remain fundamentally more open, and the state much more transparent, than most other developed or developing countries. Yet they face a number of dilemmas and are avoiding hard policy choices. Many seem to think that they can have a large oil industry and at the same time lead the fight against climate change; that they can work in corrupt, repressive regimes and still be seen as champions of human rights; that they can promote Norwegian business interests in the lobal economy to the same degree as other states but be seen as pioneers of corporate social responsibility; and that they can talk about redistributing global wealth while their pension fund continues to invest in tax havens.

Overall, Norway has lost its ethical niche. During the cold war in the 1960s and 1970s, Norway’s ‘peace-seeking’ stance stood out between the superpowers. In the 1980s and 1990s, during the wave of neo-liberal economic globalization that pushed unfettered liberalization around the world, the successful Norwegian model, with a major role for the state in economic policy, also stood out. Now, Norway’s policy-makers have not developed a big idea to give to the world. They need to make some hard decisions and develop new ideas if they are promote genuinely ethical foreign policies.

To read the full report, click here

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