Norway elections: Why investments in Israel are shaping the vote

Norway is voting on Monday to elect its next parliament in what is expected to be a close race between a centre-left bloc led by the incumbent Labour Party and a centre-right bloc dominated by the populist Progress Party and Conservatives.

Among the issues that could decide the vote are inequality and taxation, as well as growing controversy surrounding Norway’s sovereign wealth fund, which is facing scrutiny domestically and internationally over its investment in companies tied to Israel, amid the war on Gaza.Until recently, maintaining the status of the $2 trillion investment vehicle as “non-political” was a key tenet of the country’s sovereign wealth fund – the world’s biggest – which was set up in the early 1990s to manage the surplus revenue from North Sea oil sales.

The question now is how the controversy will play out at the ballot box, and whether threats of US retaliation will translate into concrete action.

How do Norway’s general elections work?
Norway has a system of proportional representation whereby 169 politicians are elected to the national legislature – known as the Storting – for four years. Of these, 150 are allocated to 19 regional districts according to population, with seats distributed proportionally among parties.

To balance local representation with national outcomes, 19 additional seats are awarded to parties whose countrywide vote isn’t fully reflected in district results. However, to qualify for these seats, a party must secure at least 4 percent of the nationwide vote.Looking ahead to September 8, polls show that nine parties are expected to win seats. On the left, Labour, the Socialists, the Greens, Centre and the Reds; and on the right, the Conservatives, Progress, the Christian Democrats and the Liberals.

If the centre-left wins, Labour’s Jonas Gahr Stoere is expected to remain in office. Stoere is looking to extend his rule after assuming power in 2021, following eight years of Conservative-led governments.

Meanwhile, a centre-right win would open the door for either Progress Party leader Sylvi Listhaug or Conservative Party head Erna Solberg (who served as prime minister from 2013 to 2021) to head the next government.

While Labour favours broadly stable taxes, some of its allies seek stiffer rates for the wealthy to finance tax cuts for low-income families and expanded public services. Progress and the Conservatives both advocate large tax cuts.