Norway must ‘prepare for life after oil’

Updated 24 May 2014

Norway must ‘prepare for life after oil’

OSLO: The IMF has called on Norway to cut back on spending its oil income, saying the economy needs no further stimulus and the government should focus on fostering private sector growth instead as it begins the long transition to life after oil.
The budget has provided the economy with repeated stimulus even though it is running near capacity. The government needs to cut back, both to save the oil income and maintain a more neutral fiscal stance, the fund said.
“The upward trend in government consumption and investment, together with the increasing labor demand from the oil and gas sector ... has crowded out and increased labor cost pressure in other exposed industries,” the IMF said after ending its annual consultation with Norway.
Norway has saved up its oil money in a fund now worth $870 billion, or $170,000 per man, woman and child, and will spend less than 3 percent of this sum this year, below its self-imposed 4 percent target.
Still, the actual amount it spends has risen because the oil fund has growth rapidly in recent years.
“We would urge a still more conservative use of the (oil fund’s) resources to maintain a more neutral fiscal stance so long as the economy remains near or above capacity,” it added.
Norway’s oil production peaked in 2000, and current output is less than half that year’s level.
As oil and gas investments ease up and then decline over the next several years, contributing less to growth, the government needs to prepare for a potentially rough transition, the IMF said.
It should curb sickness and disability benefits, complete pension reform, boost productivity, improve public services and ease trade restrictions, particularly in agriculture.
Finance Minister Siv Jensen said she had noted the IMF mission’s views but added: “At the same time I am also very concerned with how oil money is put to use. We should use it in a way that helps increase the productivity and growth potential of the economy.”
Although the IMF is projecting a smooth transition to a post oil economy, it said there was a risk it could be rocky as growth would be lower, possibly leading to disruption in the labor market.
Monetary policy, however, was just right after overcoming last year’s policy dilemma with surging house prices and super- low inflation, the IMF added.
“Relative to last year, many of the tensions ... more or less abated,” Mission Chief Tom Dorsey said. “You seem to be at a goldilocks moment, when everything is sort of just right (for monetary policy).”
The IMF sees 2014 mainland growth, or excluding the oil sector, at 1.9 percent, broadly in line with the central bank’s 1.75 percent projection. It forecasts 2015 growth at 2.4 percent versus the bank’s 2.5 percent.


Chinese artificial intelligence company files $1.4 billion lawsuit against Apple

Updated 03 August 2020

Chinese artificial intelligence company files $1.4 billion lawsuit against Apple

  • Xiao-i argued that Apple’s voice-recognition technology Siri infringes on a patent that it applied for in 2004

SHANGHAI: Chinese artificial intelligence company Shanghai Zhizhen Intelligent Network Technology Co., also known as Xiao-i, has filed a lawsuit against Apple, alleging it has infringed on its patents.
The company is calling for $1.43 billion in damages and demands that Apple cease “manufacturing, using, promising to sell, selling, and importing” products that infringe on the patent, it said in a social media post.
Xiao-i argued that Apple’s voice-recognition technology Siri infringes on a patent that it applied for in 2004 and was granted in 2009.
Apple did not respond to a request for comment. Reuters was not immediately available to find a copy of the court filing.
The lawsuit marks the continuation of a row that has been ongoing for nearly a decade.
Shanghai Zhizhen first sued Apple for patent infringement in 2012 regarding its voice recognition technology. In July, China’s Supreme People’s court ruled that the patent was valid.