Exploring The NORDIC REGION...
Student Text Page No. 2: "Current Patterns"

Tourists who plane-hop from Reykjavik, Iceland, to the other capital cities in the Nordic Region — (Copenhagen, Denmark ... Oslo, Norway ... Stockholm, Sweden ... and Helsinki, Finland) — get an aerial preview of why this region hums: All five Nordic capitals are busy seaports, gateways for the trade on which these five nations depend.

Here's one example of how vital that trade is: In 2004, the ratio of Sweden's $121.7-billion exports to its gross domestic product (GDP) was roughly 5:10. In other words, for every $10.00 worth of goods and services that Sweden produced, it sold almost $5.00 worth overseas. Each of the other four Nordic nations had a high export ratio, too.

Success story. From Swedish cars and chemicals to Danish meats and machine tools, the success of Nordic exports can be traced to a common ingredient — quality control. Even when the product is a natural resource — petroleum from Norway, timber from Finland, fish from Iceland — its regional label promises satisfaction. No surprise! Scandinavians (an historic name shared by people in northernmost Europe) have been honing their production skills for centuries. Finnish paper and Danish windmills (which help provide renewable energy) are not simply "made." They're crafted....

Unique model. The petroleum beneath Norway's offshore waters was not tapped until the mid-1970s. But from the time the industry was born, Norway's government controlled it. That's not unusual in this region. Like its Nordic neighbors, Norway has a "mixed economy" — a combination of (a) many privately owned businesses and (b) a few state-controlled industries. Indeed, through taxes on the first source, and profits from the second, each nation has been able to develop its own version of what is called the "Scandinavian welfare model." This "model" is the system by which each nation provides social security, healthcare, and education to all its citizens.

All together.... The cultural traditions reflected in Nordic welfare laws date back to an era when Scandinavians lived in small farming or fishing villages and helped neighbors in need. Today, however, Nordic nations are highly urbanized, and about 70 percent of their workers are in service industries. Thus, helping all one's neighbors is not easy. That's why Nordic societies have accepted high taxes to help fund their welfare systems. By the early 2000s, tax receipts in Sweden equaled 51 percent of its GDP! Percents were high in the other nations, too: Denmark, 50; Finland, 46; Norway, 43; Iceland, 37.
     Lately, however, businesses have been arguing that high tax bills make their products less competitive on the world market, since highly-taxed companies must raise prices to maintain profits. In response, Sweden now allows its citizens to divert some tax payments to stock-market investments. The hope is that good returns on such investments will allow Sweden to reduce the benefits it pays retirees — and thus cut taxes, too.

Regional Matters. Even with such change, the values embedded in the Scandinavian model remain strong. Nordic people believe in equal rights — a belief that explains the big role women play in Nordic governments. (In 1980, Iceland's Vigdís Finnbogadóttir was the first woman ever to be elected as head of state by popular vote. And today, women form 45 percent of Sweden's parliament.) Nordic people respect cooperation, too. Since the 1950s, all five nations have been members of the Nordic Council, cooperating on such issues as environmental protection and hi-tech research.
     All in all, this region's successful track record helps us to ponder: What national values and priorities do the peoples of the Nordic Region have in common? How widespread are those values and priorities in today's world?

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© Learning Enrichment, Inc. Content last updated: July 2005. Page last reviewed: July 2005.