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Norway PM says tap oil fund more to cope with asylum seekers: report

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Norway may have to tap its US$856 billion sovereign wealth fund than planned next year to cope with a rising number of people seeking asylum, Prime Minister Erna Solberg was reported as saying on Tuesday.

[OSLO] Norway may have to tap its US$856 billion sovereign wealth fund than planned next year to cope with a rising number of people seeking asylum, Prime Minister Erna Solberg was reported as saying on Tuesday.

Solberg's right-wing government said last week it would make the first net withdrawal from the fund to finance tax cuts and boost a slowing economy hit by weak oil prices.

Its 2016 budget planned to spend 2.8 per cent of the fund's value in 2016, up from 2.6 per cent this year, equivalent to an extra 23 billion crowns. But that sum may now increase. "We must use more money because we can't stop everything that is happening in Norway just to pay for the flow of refugees," Solberg was quoted as saying in the business newspaper Dagens Naeringsliv on Tuesday.

Asked whether this will mean an even greater use of money from the oil fund, she said: "Yes, I don't think we can manage this just by reallocating." She said the country would have to spend "billions of crowns" on the issue but did not give a precise figure.

Last week, Oslo raised its projections for asylum seekers arriving this year, the third such increase in just a few weeks as the influx from Syria to western Europe's northernmost nation grows.

The Norwegian Directorate of Immigration (UDI) said it now expects to receive 20,000-25,000 asylum applications in 2015, an increase from the 16,000-20,000 estimation it gave on Sept 16.

In 2016, more than 30,000 people will probably arrive, it said. Norway has a population of 5.2 million people.

Solberg was due to address parliament on the issue later on Tuesday.

REUTERS