"Competitiveness is one of the key issues in the Norwegian political debate. Of course, we have low unemployment and quite a high growth rate for the time being, but it's very linked to very active oil and gas production and the service industry linked to it, but we see the more traditional industries not managing the cost level we have," she said.
Trouble in Paradise?
Norway chose to remain outside the European Union (EU) and the euro currencyarea. It enjoys a stable economy and a booming housing market.
(Read More: Norway's Housing Boom Could Lead to Spain-Style Bust)
Unemployment in Norway is 3.6 percent, a fraction of the levels in struggling euro zone countries. Norway's and its population of 5 million people enjoy a per-capita GDP of $65,582, making it among the five richest nations in the world, according to the International Monetary Fund, World Bank and the United Nations.
Like Russia, which also has garnered vast amounts of wealth from its oil and gas reserves, Norway is looking to diversify its economy to reduce its dependence on natural resource revenues.
Oil money has allowed the country to create a generous welfare state, Solberg said, but it has decreased participation in the labor market.
"We have had a relaxed approach to public expenditure because of the growth and the income rate, but we have had a very large wage crisis in the last year," Solberg said.
"It's not an easy political target but it's one we have to think about," she added, saying the incentives to work had waned as national wealth grew. Wage costs have risen 63 percent since 2000, the central bank of Norway said recently.
We all agree that the security level that a welfare system gives is very important and our flexible labor market gives us that, but if you look at the growth in our systems and the amount of people outside the labor force and on these welfare schemes, it's a tragedy for some of those people but it's also an economic long-term burden for our society," she said.
-By CNBC's Holly Ellyatt, follow her on Twitter @HollyEllyatt