An interview with Mr. Erling Skonsberg, Ambassador Extraordinary and Plenipotentiary of the Kingdom of Norway to Azerbaijan

AT: Mr. Ambassador, could you please tell us a little bit about yourself? What was your job before being appointed ambassador to Azerbaijan?

I grew up close to the city of Lillehammer, known for the Olympic Winter games in 1994. I have a degree in economics from Norway and started my international career with the United Nations Industrial Development Organization (UNIDO) in Dar es Salaam, Tanzania, where I was from 1983 to 1986. After joining the Ministry of Foreign Affairs I served with the Norwegian Embassies in Abidjan, Cote d’Ivoire, and The Hague, Netherlands. From 2003 until 2007 I was Deputy Head of Norway’s delegation to the Organization for Security and Co-operation in Europe (OSCE) in Vienna. The last three years before going to Azerbaijan I worked in the Section for Disarmament and Non-proliferation in the Norwegian Ministry of Foreign Affairs, amongst others dealing with the International Atomic Energy Agency (IAEA).

I am very honoured to be in Baku since September last year. Norway looks at Azerbaijan as a long term partner and I hope to contribute to broadening and deepening the relationship between our countries.

AT: Mr. Ambassador, how do you evaluate the integration process of Azerbaijan to Europe?

Azerbaijan has already taken valuable steps towards political and economical integration with Europe. Economically the already existing pipelines of oil and gas to the west are important and beneficial both to Azerbaijan as a producing country and consumers further west. Norway is also a staunch supporter of a Southern Gas Corridor and highly appreciated the Joint Declaration signed by President Aliyev and President Barroso in Baku on 13 January.

I hope to see Azerbaijan continue to move even closer towards European structures, standards and values and integrate into Global and financial structures, including joining the WTO. In my view such steps will benefit the country and future generations. Norway is also a strong supporter of the EUs Eastern Partnership with Azerbaijan and five other countries. In short I believe that closer economical and political integration with Europe builds strong and prosperous neighbours, and it is Norway’s interest to have such prosperous neighbours.

AT: Today Azerbaijan is a leading state in economic field in the Caucasus region. How much have Norwegian companies invested in Azerbaijan after independence of Azerbaijan?

The “Contract of the Century” has of course been very important to the impressive economic development of Azerbaijan. Norwegian companies have been investing a lot in Azerbaijan since independence, and the total figure so far amounts to some USD 5 billion. Norwegian companies have excellent cooperation with local partners and I see the investments and the cooperation as very positive.

AT: As ambassador of Norway to Azerbaijan, in what other industries do you think Norwegian companies can become active?

Most of the Norwegian investment so far is related to the oil and gas sector. I would be pleased to see more Norwegian companies invest in Azerbaijan also in other sectors and more trade between our two countries. There should be possibilities for this and it is of course up to the private sector to decide. I will try to assist the private sector in identifying the opportunities. Bringing businesspeople together will support prosperity in both in Azerbaijan and Norway.

AT: Norway is rich with its hydrocarbon recourses in Europe, how are oil and gas revenues distributed among the population?

Petroleum activities have generated a positive net cash flow for the Norwegian government since 1971. According to the Ministry of Finance, around 40 percent of the government’s net cash flow from petroleum production has so far been spent through the public budgets. Since 1996, the remainder has been transferred to the Government Pension Fund Global and invested in global equity and fixed income instruments.

The first transfers to The Government Pension Fund Global took place in 1996. The fund is an important instrument of economic policy in Norway, intended to underpin long-term considerations in the use of government petroleum revenues and support government saving to finance public pension expenditure.

In spring 2001, the government introduced a fiscal rule for the spending of petroleum revenues over the central government budget. Under this rule, annual spending over time is to correspond to the expected real return on the Government Pension Fund Global, estimated at 4 percent of assets under management.

The spending of petroleum revenues over the central government budget is subject to the same decision making procedures as any other income of the central budget. Namely that the Norwegian Parliament (the “Storting”) each year decides on taxes to be collected and the expenses to be accomplished. The Parliament decides on the accumulated income and expenditures of the central government budget, based on a proposal from the Ministry of Finance. Thus the population benefits from the oil and gas revenues through the budget of the sector ministries regarding for instance education, health services and infrastructure, as well as present and future pensions.

AT: As it is our first interview with you, we kindly ask you to share your impressions of Azerbaijan with our readers.

My impressions during the first six months are very positive and I am delighted to be here. Azerbaijan has a long an interesting history and a rich culture. The people are very nice and friendly. I enjoy walking in the old city, listening to jazz and classical music. I look forward to further explore the culture and visit more of the countryside of Azerbaijan.