At the same time, there has been a considerable decrease in prices for our imports, such as clothing, footwear and electronic equipment. From 2003 to 2008, this improvement in Norway’s terms of trade alone boosted national income by more than 20 per cent, or a good 4 per cent per year. The picture of Norway’s favourable situation has been reinforced by the very severe impact of the financial crisis on other western economies, while Norway seems to have emerged with nothing more than a mild downturn. Nevertheless, there are many challenges ahead. Chart 1 Relative labour costs Deviation from the average for the period 1970–2009 Per cent, 1990–20101  1  Figures for 2010 are an average for the period 1 January–19 August 2010. A rising curve indicates weaker competitiveness. Sources: Statistics Norway, Technical Reporting Committee on Income Settlements (TBU), OECD, Ministry of Finance and Norges Bank. Norwegian labour has never been as costly as it is now. Norwegian businesses may lose out in the competition for contracts given the current high level of spare capacity in other countries. There are frequent reports of businesses relocating activities to neighbouring countries, such as Sweden. Labour in Sweden is perhaps as much as 30 per cent cheaper than in Norway and the two countries are closely connected in terms of language and culture. The management of Norway’s oil wealth poses another challenge.
The ultimate vision is for the Asia School of Business to be a premier business school that develops transformative and principled leaders who will contribute to the advancement of the emerging world, particularly in Asia. Bank Negara Malaysia’s commitment to this collaboration is not only in providing the 20-acre land that is in the green lung of Kuala Lumpur for the campus and in building state-of-the-art facilities for the School, but being very much part of the Asian region, we hope that Malaysia, and more specifically, the Central Bank, will also be leveraged upon for our knowledge and experience in the region. BIS central bankers’ speeches  1  Located in the heart of Asia, Malaysia offers an eclectic mix of cultures and ethnic backgrounds that reflects the heterogeneity of Asia. As a highly open economy, Malaysia has strong economic and financial inter-linkages with the world, from Asia to the advanced economies and other emerging economies, including Latin America, the Middle East and Central Asia. The School will, therefore, draw extensively from the network of businesses in the emerging world to provide a platform for learning and research, and thus offer an extensive experience of the diversity that exists, in particular, in Asia. With the strength founded in the collaboration, I am confident of our potential to develop the Asia School of Business on solid foundations. The Bank looks forward to working with MIT Sloan in making this collaboration a success.