experienced a moderate recession in 2002 and the beginning of 2003. since the first half of 2003, growth has again been high. it may appear that growth in the norwegian economy has become more self - driven. in the early phase of the recovery, private consumption, traditional exports and fixed investment in the petroleum sector were the most important driving forces. in the last few years, household demand has been underpinned by low interest rates, high real wage growth and higher asset prices. real wage growth was relatively high in 2004, although nominal wage growth was lower than it has been in several years. higher imports from low - cost countries and intensified competition in a number of industries have kept inflation at a low level. these factors have led to brisk growth in household purchasing power. mainland fixed investment has gradually become an important driving force behind the upturn. investment has picked up in most industries and growth was stronger than expected towards the end of 2004. norges bank ’ s regional network has registered rising investment in all industries. petroleum investment in particular appears to be growing at a faster pace than projected. this may continue to boost mainland output. high wage growth in norway relative to other countries and a periodically high krone have weakened the profitability of norwegian export companies and dampened export growth. growth in traditional exports has nevertheless picked up in the past two years. prices for many of our main export goods have risen as a result of strong growth in new markets. however, growth in norway ’ s total exports, excluding oil and gas, is lower than import growth among our trading partners. the fall in interest rates has pushed up house prices. turnover in the housing market has been high. high resale home prices have made it more profitable to build new homes, and residential construction is rising. higher housing wealth provides increased borrowing opportunities and thereby also boosts demand for consumer durables. household debt has risen by around 11 per cent over the past year. credit demand in the enterprise sector remains low. despite the strong upturn in the mainland economy, the rise in the number of employed has been fairly modest. productivity rose sharply in the first few quarters after economic growth picked up. normally, strong productivity growth is gradually followed by an increase in employment. the current upturn has lasted about two years. the fairly low level of growth in employment, as measured by the number of employed, must be seen in the light of the sharp decline in sickness absence through 2004. the decrease in sickness absence has reduced the need for new

a reasonable balance between letting automatic stabilisers operate and seeking further consolidation where needed. in some cases, current consolidation ambitions are weak. in order to further boost confidence in the fiscal framework and the economic environment, it is essential that appropriate consolidation plans are implemented in all countries with remaining imbalances. hence, the commitments made in the stability programmes and the requests to further improve fiscal positions, as subsequently agreed in the ecofin council, must be implemented in full. in this respect, the measures should be part of a comprehensive and growth - oriented strategy, which for most countries means putting the focus on both restraining the volume, and reforming the structure, of public expenditure. finally, the outlook for the euro area economy could be significantly improved if governments strengthen their efforts to implement structural reforms in labour and product markets. such reforms are important to ultimately raise the euro area's production potential, improve the flexibility of the economy, and make the euro area more resilient to external shocks. in particular at the current juncture, when economic activity is subdued, taking measures to make the euro area a more attractive place to invest in can contribute substantially to fostering confidence. we are now at your disposal for questions.