Total investments are expected to increase in 2019
Companies’ latest investment estimates for 2019 are expected to increase within oil and gas, manufacturing, mining and quarrying and electricity supply. New 2018 estimates are adjusted downwards, but still show growth compared to 2017.
The investment survey conducted in May within oil and gas, manufacturing, mining and quarrying and electricity supply suggest that total investments will amount to NOK 211 billion. This is 7.4 per cent higher than the corresponding figure for 2018. The increase in 2019 is driven by positive investment forecasts within the oil and gas industry as well as for manufacturing. Investments within electricity supply are expected to be at the same level as in 2018.
Companies’ latest investment estimates for 2018 are 2 per cent lower compared to the first quarter of 2018. The investments in 2018 amounted to NOK 222 billion, measured in current value. This is however 4.6 per cent higher than the estimates given for 2018 at the same time last year. This increment in 2018 is particularly due to the investment growth in electricity supply. For more details about investments within the oil and gas industry, please see the following article (link).
Figure 1. Estimated investments collected in 2nd quarter same year
|Extraction and pipeline transport||Manufacturing, mining and quarrying||Electricity supply, gas and steam|
According to seasonally-adjusted figures, quarterly final investments had the following development from the 4th quarter of 2017 to the 1st quarter of 2018:
- Oil and gas: -8.4%
- Manufacturing : -1.5%
- Electricity supply: 6.1%
Figure 2. Final investments per quarter. Seasonally adjusted. 2005=100
|Manufacturing||Electricity supply, gas and steam||Extraction and pipeline transport|
Wind farm developments give investment growth in electricity supply in 2018
The latest investments in electricity supply for 2018 amounted to NOK 40.0 billion. This is 15 per cent higher than the final investments for 2017. This significant growth is particularly due to a high investment level within the production sector. The growth can be related to investment in new wind farm developments, as well as a higher investment level within the transmission and distribution sector compared to 2017. Installation of new power meters (AMS) and upgrades in the power grid explain this development.
The first estimates for 2019 indicate that investment within electricity supply will remain at the same level next year as in 2018. Investments within production of electricity are estimated to grow 30 per cent, where a significant part of the growth can also be related to wind farm developments. Investments in transmission and distribution of electricity now show a decline of 16 per cent for 2019. This decline is linked to the completion of the installation of AMS smart meters in 2018.
Figure 3. Investments. Electricity supply, gas and steam. Estimates given on different points in time
Increase in manufacturing investments in 2018
Latest estimates for manufacturing amounted to NOK 23.7 billion in 2018; 7.8 per cent higher than the corresponding figure for 2017. The expected growth in 2018 is due to high investment within the industry grouping refined petroleum, chemicals and pharmaceutical products as well as paper and paper products, and machinery and equipment also contributed to this increment. The overall increase in 2018 is somewhat dampened by a lower investment level within basic metals, fabricated metal products and ships, boats and oil platforms.
Figure 4. Investments. Manufacturing, mining and quarrying. Estimates given on different points in time
1 The contribution by industry is calculated by multiplying the percentage change of the industry with the industry's share of manufacturing.
Figure 5. Contribution by industry for rate of change in manufacturing 2018/2017¹. Estimated collected in Q2 same year
|Contribution by ind.||Percentage change|
|Furniture and manufacturing n.e.c.||0.6|
|Repair, installation of machinery||0.8|
|Transport equipment n.e.c||0.9|
|Ships, boats and oil platforms||-0.8|
|Machinery and equipment||2.0|
|Computer and electrical equipment||-0.7|
|Fabricated metal products||-1.4|
|Rubber, plastic and mineral prod.||1.2|
|Refined petro., chemicals, pharmac.||5.5|
|Paper and paper products||1.8|
|Wood and wood products||1.5|
|Textiles, wearing apparel, leather||0.0|
|Food, beverages and tobacco||0.1|
Manufacturing investments are expected to increase in 2019
The first estimates for 2019 indicate an increase in manufacturing investments; 15 per cent higher compared with the corresponding figure for 2018. The expected growth in 2019 is due to a high level of investments in the industry grouping refined petroleum, chemicals and pharmaceuticals; 40 per cent higher compared with the corresponding figure for 2018. In addition, higher growth is expected within food products. The investment growth for this sector can particularly be related to the processing and preserving of fish. It is important to note that early estimates for next year can be somewhat uncertain and should be interpreted with caution.
1 The contribution by industry is calculated by multiplying the percentage change of the industry with the industry's share of manufacturing
Figure 6. Contribution by industry for rate of change in manufacturing 2019/2018¹. Estimates collected in Q2 the previous year
|Contribution by ind.||Percentage change|
|Furniture and manufacturing n.e.c.||0.4|
|Repair, installation of machinery||3.3|
|Transport equipment n.e.c||0.5|
|Ships, boats and oil platforms||-0.1|
|Machinery and equipment||1.6|
|Computer and electrical equipment||-0.1|
|Fabricated metal products||0.8|
|Rubber, plastic and mineral prod.||-0.5|
|Refined petro., chemicals, pharmac.||9.8|
|Paper and paper products||2.7|
|Wood and wood products||0.5|
|Textiles, wearing apparel, leather||0.3|
|Food, beverages and tobacco||2.9|