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06/12/2016

Commission and Norway fight over single market contribution

Agriculture & Food

Commission and Norway fight over single market contribution

Norway's minister for the EU, Vidar Helgesen.

[Utenriksdepartementet UD/Flickr]

Norway claims that the European Commission has asked the Scandinavian country to double the amount it gives to the European Economic Area (EEA) over the next five years.

The Commission is currently in the middle of discussions with the EEA countries Norway, Lichtenstein and Iceland on their financial contributions until 2020. Norway paid around €1.63 billion for its EEA membership the past five years.

According to Vidar Helgesen, the minister for the EU and European Economic Area (EEA), the European Commission now wants slightly less than the double of this amount over this period of time.

“The EU must change its approach if we are going to reach an agreement for a new period with EEA funds. We believe the EU’s demands are unrealistic and unreasonably high,” Helgesen told Dagens Næringsliv.

Norway is not a member of the EU, but is a member of the EEA which entered into force on 1 January 1994. It allows Norway, Iceland and Liechtenstein to participate in the EU’s single market.

But Maja Kocijan?i?, a spokesperson for EU Foreign Affairs and Security Policy, told EurActiv that the Commission has not asked any of the EEA/EFTA countries to double their financial contribution. The final amount is a matter of ongoing negotiations, Kocijan?i? said.

She added that there is no fixed deadline for the ongoing negotiations, but that all parties seem to be aiming for concluding the negotiations as swiftly as possible.

The Commission has viewed Norway as a troublesome member of the EEA over the past years.

For more than a year, the Commission has complained that Norway has put extra taxes on imported goods from the EU and failed to implement more than 400 directives, effectively obstructing the EU’s single market.

For example, in January 2013, Norway introduced a tax on certain imported goods, bringing the price of imported EU cheese up by 277% and the the price of imported hydrangea flowers by 72%.

The pro-EU Norwegian government, which took office in September 2013, has stated many times that it aims to live up to the rules of the single market, but that a majority in the Norwegian parliament is blocking changes to Norway’s EU affairs policies.

Positions

Vidar Helgesen, Norway's Minister of EEA and EU Affairs, reacted to this article, saying EU-Norway relations were "excellent" and that the EEA Agreement had so far been "a success story to all parties involved."

The EEA Agreement, he said, "has existed for over 20 years," bringing "significant economic growth" across its 31 member countries. For Norway, this translated in the incorporation of "more than 10,000 EU legal acts" into the country’s national legislation, Helgesen said. "More legal acts were implemented in Norwegian law in 2014 than in any other year since the EEA Agreement entered into force," he stressed.

Helgesen admitted however that, "there are some challenges, stemming primarily from the very nature of this agreement".

"The EEA EFTA countries can first process legislation once the EU has adopted it, meaning a certain natural backlog is inevitable. It is a joint responsibility for the EEA EFTA states and the EU to limit this backlog as much as possible. The EEA EFTA side has therefore put in place various measures that should bring a further reduction in the backlog time ahead. This is a matter of priority for us, and we are pleased that the backlog has been reduced significantly the last few months. We also trust that the EU side will do its utmost to make the decision-making process in the EEA as efficient as possible."

He continued: "When it comes to the present negotiations on new financial contributions from the EEA EFTA states to social and economic cohesion in the EU, it is a fact that the EU has demanded a large increase. This demand goes way beyond the very modest increase in EU's own contributions to cohesion efforts the next few years. This is neither reasonable nor acceptable. The worrying lack of progress in these negotiations is a direct result of the EU side's failure to acknowledge this."

"Regarding the agricultural products referred to in the article, they must be viewed separately from the discussion of the EEA Agreement. Agriculture as such is not part of the Agreement. It is important to see this issue in a broader context. Norway is in fact one of the countries in Europe with the highest share of imports of agricultural products, and the big bulk of these imports come from the EU. We will now start negotiations with the EU on possible further liberalisation of trade in agricultural products. However, it should not come as a surprise that Norway, like many EU countries, seeks to protect some products in the agricultural sector and in this way to safeguard agricultural production even in remote communities."

Background

Norway is not a member of the EU, but closely associated with the Union via its membership in the European Economic Area (EEA), in the context of being a European Free Trade Association (EFTA) member.

After Norwegians voted against an EU membership in 1994, the country subsequently joined the EEA, along with Iceland and Liechtenstein. Iceland is now on course to join the EU.

Norway's trade is dominated by the EU and Norway is the EU's  4th most important partner.

Norway to EU trade amounted to €91.85 billion in 2008, primarily energy supplies (only 14.1% is manufactured products). EU exports to Norway were worth €43.58 billion, and primarily constituted manufactured products.

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