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Sweden Economical Facts

 

Economical overview

Sweden has an export-oriented, high-tech and well-diversified economy, which is considered one of the world's most competitive. Wood, iron ore and hydroelectric power laid the foundation for a robust economy that has since been developed to include information technology, in addition to a large service sector. Government finances have been a guiding principle for economic policy.

Until the 1870s, most Swedes lived in a poor farming community. Extensive industrialization and an open trade climate meant that exports of goods subsequently grew rapidly. Today, the economy is dominated by the service sector.

  • Countryaah.com: Major imports by Sweden, covering a full list of top products imported by the country and trade value for each product category.

The Social Democrats who dominated for most of the second half of the 20th century had the goal of achieving full employment and high welfare levels combined with high growth and reduced income inequality. Above all, to ensure welfare, the public sector was expanded with the help of tax funds, which has meant that the overall Swedish tax burden is one of the highest in the world. It is this policy that has been called "the Swedish model". The bourgeois government that governed the Commons did not depart from the model (see below).

Good economic growth in the first decades after the Second World War slowed in the 1970s. A first crisis occurred in the middle of the decade, with rising oil prices and rising labor costs. Many jobs in the industry disappeared while the public sector grew, as did the budget deficit.

  • Abbreviationfinder.org: Check this abbreviation website to find three letter ISO codes for all countries in the world, including SW which represents the country of Sweden.

State economic crisis

Economical Facts of Sweden

Around 1990, fundamental weaknesses in the economy could no longer be tackled, and the greatest decline since the 1930s began. The bourgeois government in 1991–1994 was forced to experience three years of negative growth, which created massive deficits in the state budget. However, the government was able to initiate privatization of business enterprises and state-owned companies, and the crisis began to subside in 1994, after the currency, the krona, had to fall in value.

From the mid-1990s, comprehensive austerity measures were implemented with the aim of creating a budget balance and breaking the trend of growing government debt. The decontamination of the economy led to lower interest rates and increased real wages thanks to low inflation. The powerful measures helped to accelerate growth again. Strong expansion among telecommunications and information technology companies and a rapidly rising stock exchange took off.

After the turn of the millennium, an international recession followed and the so-called IT bubble burst. Many overvalued computer companies went bankrupt and unemployment increased. Despite the problems, economic growth was just under 2 percent these years, which was higher than in many other countries.

A strong upturn in the global economy began in 2004. The government again promised increased grants and some tax cuts, including delayed tax on inheritance and gifts. But the large number of sick leave, early retirement and unemployed was a heavy burden on the state's finances. Nevertheless, the economic upturn continued to be strong and a certain brightening in the labor market was evident.

Earned income tax credit

The upturn was reinforced when the bourgeois government from 2006 began to implement its program with reduced income taxes for employees and stricter rules for beneficiaries and lower unemployment benefit. The government also initiated sales of state-owned companies.

The economy went strong until it almost collapsed when the international financial crisis became a reality in the autumn of 2008. The forecast hail, not least in the engineering industry. Unemployment soared, investment fell and interest rates reached record lows. Growth was negative, GDP fell by 5 percent in 2009. The government long resisted demands for stimulus measures, but eventually presented increased government grants to the municipalities and more labor market policy initiatives. Soon the curves turned upwards and growth in 2010 was as good as it was bad the year before. Sweden was one of the countries that survived the crisis best. A contributing factor was the tight fiscal policy that has been in place since the 1990s decontamination, and the budget surplus that existed before the crisis.

The bourgeois government elected in 2010 continued to focus on reforming the labor market and gaining control of government spending. However, it lacked its own majority in the Riksdag and suffered an early defeat when the opposition put its wheels in the wheels for continued sale of state-owned companies. Continued inertia in the global economy and, not least, the crisis in the eurozone also contributed to slowing growth.

Still, per capita growth, as well as efficiency and productivity, continued to be stronger in Sweden than generally in Western Europe and the United States. Despite the major slowdown in 2009, growth between 2005 and 2015 averaged 1.8 percent. The debt ratio, that is, government debt as a share of GDP, has more than halved since the 1990s.

Foreign trade

Sweden, which has a small home market, is extremely dependent on trade with the outside world. Exports are normally larger than imports. Traditional export goods such as wood, pulp, iron and steel are now joined by, among others, electronics and telecommunications equipment.

Almost half of GDP consists of exports of goods and services, compared with just over a quarter in 1992. The majority of all products manufactured are exported.

The current account balance, which also includes trade in services and transfers and return on capital, has shown surpluses since the mid-1990s after many years of deficits. Exports of services account for almost one third of total exports.

Trade mainly takes place with the EU and especially with Germany and the neighboring countries in the Nordic countries (including Norway, which is not an EU member). Exchanges with the United States and countries in Asia have grown rapidly in recent years.

FACTS - FINANCE

GDP per person

US $ 54 112 (2018)

Total GDP

US $ 551,032 M (2018)

GDP growth

2.4 percent (2018)

Agriculture's share of GDP

1.0 percent (2018)

Manufacturing industry's share of GDP

13.8 percent (2018)

The service sector's share of GDP

64.8 percent (2018)

Inflation

1.7 percent (2019)

Government debt's share of GDP

38.5 percent (2018)

Currency

1 krona = 100 cent

Merchandise exports

US $ 178,313 million (2018)

Imports

US $ 169,648 million (2018)

Current account

US $ 9,458 million (2018)

Commodity trade's share of GDP

61 percent (2018)

Main export goods

machinery and vehicles, pharmaceuticals and chemicals, electronics and telecommunications equipment, minerals, paper and wood

Largest trading partner

Germany, Norway, Denmark, Netherlands, USA, Finland

2007

November

The State Secretary resigns

Fredrik Reinfeldt's state secretary Ulrica Schenström resigns since her questioning has been questioned. She has been drinking alcohol in a restaurant and reportedly been intoxicated, and kissed a political reporter from TV4, despite having on-call responsibility for the government's emergency preparedness.

September

New FP leader

Lars Leijonborg who has lost support within his party FP resigns as party leader and education minister. He is succeeded on both posts by Jan Björklund.

The Minister of Defense resigns

Mikael Odenberg is protesting against major cuts in defense appropriations. He is succeeded by Minister of Commerce Sten Tolgfors. Ewa Björling is appointed new Minister of Commerce.

July

New tax deduction for household services

The rut deduction is introduced, a right to tax deductions for individuals for so-called household services ("rut" stands for cleaning, maintenance and washing).

March

New S-conductor

Mona Sahlin is elected party leader at the Social Democrats party congress.

January

Tax cuts are implemented

The first step in the so-called job tax deduction is introduced, one of the most important election promises of the bourgeois alliance. This means reduced tax on income from work or business. The fee for the a-cash is raised, in many cases substantially. The rules for compensation from the unemployment insurance fund also change in several respects. The wealth tax is removed.

 

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