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BUSINESS FOCUS - NORWAY - AID PACKAGE TO BRIDGE ECONOMIC GAPS DEMONSTRATES EUROPEAN SOLIDARITY

Norway puts money where its mouth is

NORWAY's commitment to balancing regional disparities in Slovakia goes beyond talk. Over the next five years, the Scandinavian country will provide the financial support to help make it happen.
The aid package is a part of a larger project [European Economic Area Financial Mechanism] designed to help Central and Eastern European countries bridge the economic and social gaps within their societies.
On January 11, State Secretary Kim Traavik of the Norwegian Foreign Affairs Ministry and Slovak Vice-Chairman Pál Csáky signed a Memorandum of Understanding defining how the Norwegian Financial Mechanism will work.


STATE Secretary Traavik.
photo: TASR

NORWAY's commitment to balancing regional disparities in Slovakia goes beyond talk. Over the next five years, the Scandinavian country will provide the financial support to help make it happen.

The aid package is a part of a larger project [European Economic Area Financial Mechanism] designed to help Central and Eastern European countries bridge the economic and social gaps within their societies.

On January 11, State Secretary Kim Traavik of the Norwegian Foreign Affairs Ministry and Slovak Vice-Chairman Pál Csáky signed a Memorandum of Understanding defining how the Norwegian Financial Mechanism will work.

According to the agreement, Slovakia will receive €7.6 million each year on average until 2009, bringing Norway's overall financial assistance to Slovakia to €38 million.

Norwegian funds will be used in nine priority areas, including border cooperation, regional development, programmes in the health and education sectors, and projects for minorities.

Norway will cover 60 percent and Slovakia 40 percent of the costs for each individual project.

"It is not a small amount of money that will flow to border areas and to Eastern Slovakia to ease the regional disparities there. I am grateful to the Norwegian government, and I am confident that such projects will spur other activities in the region," Pál Csáky told the press.

While Norway is not a member of the European Union, it is a part of the European Economic Area (EEA). The EU is Norway's main business partner; consequently, Norway cares about EU development. After signing the Memorandum of Understanding, State Secretary Traavik told The Slovak Spectator that there are several reasons why Norway supports projects like this one.

"As a European country close to the EU, we have a responsibility to help bridge the economic and social gaps that exist in the enlarged EU. It is a part of our solidarity [with Europe] and our responsibility to do so," he said.

According to Traavik, Norway considers the smooth functioning of a single European market as very important. The EU accounts for 70 percent of Norway's trade business.

"From that point of view, it is important that we do what we can to make the single market function as well as possible and as soon as possible," Traavik said.

The state secretary also emphasized that Norway's financial aid package could help pave the way for an influx of Norwegian investors into Slovakia. So far, the mutual trade between both countries is small.

According to the Slovak Statistics Office, Slovakia exported Sk2.04 billion (€50 million) to Norway in the first 11 months of 2004 - only 0.2 percent of overall Slovak exports. For the same time period, Slovakia imported Norwegian goods worth Sk1.01 billion (€30 million), making it just 0.1 percent of Slovak imports. The result is a Slovak trade surplus of roughly Sk1.03 billion (€30 million).

Traavik told The Slovak Spectator that Norway attaches importance to bilateral trade with Slovakia, which it sees as becoming more important in Europe.

"I feel confident about [deepening Norway's financial cooperation with Slovakia]. In the process of building networks and mutual awareness in terms of what each side can deliver in expertise, technology and competence, I am sure that there will be a substantial increase in economic cooperation between the two countries."

Csáky said that the relevant ministries of the Slovak government would solve issues surrounding eligibility for funds and their dispersal.

"We will inform the public about the possibilities. I think that it will depend on individual projects. For a project in the healthcare sector, for example, hospitals would be likely applicants. In the case of regional projects, municipalities would be the recipients," Csáky said.

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