Latest news with #Svantesson
Local Sweden
15-04-2025
- Business
- Local Sweden
Sweden was on the road to economic recovery
The government expects Swedish economic recovery to be delayed by at least half a year as a result of high US tariffs and the global trade war, Finance Minister Elisabeth Svantesson told a press conference announcing Sweden's spring amendment budget. Advertisement "We had good conditions for kickstarting the economy, but then this happened, which we've spoken about a lot ‒ the trade war materialised," Svantesson said, while adding that President Donald Trump's actions have damaged trust in the US. "It will take a lot of time to rebuild that trust," she added. She also expressed disappointment in the US' treatment of its allies and trade partners. "If I'm being honest, it's sad that one of our partners, which we hope the US will be for the long-term, is treating other countries, which it should be allied with, and who are important trade partners, in this way," she added. "It doesn't benefit anyone, on the contrary it makes the situation worse for the vast majority." "What we're experiencing now is something we've never seen before." According to Svantesson, the US' decision to raise tariffs has essentially broken the positive trend in the economy which began at the end of last year. "That doesn't mean it won't come at the end of this year," she said, "but there's no doubt that it will inhibit growth." Despite this, Sweden has stable finances, she added. "Sweden is in a fantastic position, the financial framework that was put into place in Göran Persson's era has put us in an unbelievably strong position." Göran Persson, a Social Democrat, was Sweden's finance minister between 1994 and 1996, later becoming prime minister between 1996 and 2006. He created a financial framework with strict rules for the budget process, limits on spending and a surplus target of 1 percent. This means among other things that Sweden has comparatively low government debt compared to similar countries. Advertisement The spring amendment budget (vårändringsbudgeten) is usually mainly used to tweak or add bits and pieces to Sweden's main annual budget, which was presented last autumn. This year's spring budget includes proposals amounting to 11.5 billion kronor. The biggest post is an 4.35 billion kronor increase to the ROT tax reduction which currently allows households to claim back 30 percent of the cost of labour on maintenance work such as repairs, conversions and extensions. Under the new proposal, the ROT reduction will be increased temporarily to 50 percent from May 12th until the end of the year, which the government hopes will boost the economy by encouraging construction and renovation work. This will take up 40 percent of the budget. There are also posts on defence, security, increasing study places on vocational courses in order to get more people into work, increasing the number of spaces in prisons and detention centres and preventing youth crime. "In uncertain and worrying times, Sweden stands strong," Svantesson wrote in a statement. "With world class public finances, the government can submit a spring budget that supports the economy while investing in safety and security. Step by step we are building a stronger and safer Sweden, not only for today but also for our children and grandchildren."
Reuters
15-04-2025
- Business
- Reuters
Swedish spring budget pledges $1.2 bln in extra spending
STOCKHOLM, April 15(Reuters) - Sweden's government said on Tuesday it will raise spending by around 11.5 billion Swedish crowns ($1.18 billion) this year, to support economic recovery under threat from global trade friction. "The US decision on significantly raised tariffs has caused Sweden is on stable economic ground and able to take further action should the need arise," Finance Minister Elisabeth Svantesson said in a statement. Svantesson had already warned that economic growth would be negatively affected by uncertainty surrounding the effects of on-again, off-again tariffs announced by U.S. President Donald Trump.
Reuters
19-03-2025
- Business
- Reuters
Swedish government lifts inflation outlook amid economic uncertainty
STOCKHOLM, March 19 (Reuters) - Sweden's right-wing government on Wednesday hiked its forecast for inflation this year and said it would monitor the development of price pressures as the economy slowly recovered against a backdrop of global uncertainty. The government said in a statement it sees headline inflation at 2.5% this year and 1.9% in 2026, up from its December forecasts of 2.0% and 1.8%, respectively. It also slightly raised its growth forecast for this and next year. here. Finance Minister Elisabeth Svantesson said less than a year ago that the battle to push back inflation had been won after price rises began slowing from double-digit highs hit during the global post-pandemic surge in costs. Data in the early months of this year has cast some doubts on that assertion with inflation coming in higher than expected and well above the central bank's 2% target, undermining expectations the Riksbank might cut rates further this year. Svantesson told a press conference she stuck by her statement on inflation from last year. "But of course we will keep our eyes on the development of inflation in the months ahead." With growth in the Swedish economy yet to fully recover and unemployment running high against a backdrop of global trade tensions, both monetary and fiscal policy makers are left with an uncertain outlook for the months ahead. "The conditions abroad are brutally uncertain," Svantesson said. Earlier on Wednesday, a survey showed a broad measure of inflation expectations one year ahead rose sharply though they saw a more limited rise in the five-year interval. The Riksbank is due to present its latest rate decision on Thursday and is expected to keep its key policy rate unchanged.
Local Sweden
19-03-2025
- Business
- Local Sweden
Is Sweden's government ready to bring in 'a modern war economy'?
The overarching theme of the ruling Moderate Party's annual congress for local politicians over the weekend was defence, and more specifically how to pay for it. "It is sometimes said that freedom is priceless, and that's true," Sweden's prime minister Ulf Kristersson declared in his speech launching the congress on Friday. "But it is equally true that freedom comes at a price." He made no mention of US President Donald Trump's embrace of Russia and its president, Vladimir Putin. But the 143 billion kronor the government had only a few months ago decided to pump into defence in 2025 ‒ double what it spent only a couple of years back ‒ would now "not be enough", he said. He had, he announced, instructed Finance Minister Elisabeth Svantesson and Defence Minister Pål Jonsson to prepare for a much bigger increase in defence spending in time for the extra amendment budget in the spring. The next day, Svantesson went further still in preparing people for the coming bill to be paid. "What I say might sound a little drastic, but I see a modern war economy ahead of me," she said in her speech. They're not alone. German MPs on Tuesday voted to exempt defence spending from the country's strict debt rules and to set up a 500-billion-euro fund for infrastructure investments, a move incoming Chancellor Frederik Merz described as "nothing less than the first major step towards a new European defence community". Denmark's government, meanwhile, has allocated 50 billion kroner to a new defence fund . Advertisement The jury is out, though, on whether Sweden's government is willing to back its tough rhetoric on defence spending with unpopular decisions. "Stronger defence is going to require some prioritising," Kristersson warned, but then immediately promised that the increase would not be funded either by "damaging taxes" or by cuts to healthcare, schools and elderly care. Svantesson, meanwhile, backtracked on her 'war economy' rhetoric, joking that no one should expect WW2-style ration cards or to be forced to drink 'coffee substitute', promising instead a streamlining of government spending, with "fewer press officers". She also promised an increase in borrowing. "We are going to need to borrow money to quickly reach the level of spending required." The opposition Social Democrats were willing to go further. The party's leader, Magdalena Andersson, and its finance spokesperson, Mikael Damberg, preempted the Moderates' conference, calling on Thursday for a 250 billion kronor defence fund. The fund would be debt-financed and would help cover defence spending over the next ten years. "This needs to happen at a furious tempo," Andersson said. Advertisement Unlike the Moderates, the Social Democrats want defence spending to be partly funded by higher taxes, with the party repeating calls for a beredskapsskatt or 'preparedness tax', which would be levied on top earners. Both the former communist Left Party and left-wingers within the Social Democrats welcomed what they saw as Andersson's abandonment of the balanced budget target she agreed with the government parties last year. The Left Party's leader Nooshi Dadgostar claimed that Andersson's proposal essentially spelled the end of the target, and opened up instead to the deficit financing the Left Party has long called for. "This is about loaning to invest," she said. "That's the whole point of taking away the brakes on investment and that is what the Social Democrats are now proposing," she said. Daniel Suhonen, part of the Reformisterna left-wing group of Social Democrats, also congratulated Andersson, writing on X that it was "a milestone" in the party's development, as did Lisa Nåbo, chair of the party's youth wing, who said that the decision to use deficit financing would allow Sweden to catch up with long-delayed but necessary investment in infrastructure. Advertisement Andersson, however, denied that she was abandoning her commitment to balanced budgets. "Our judgement is that it should be plus and minus in the government finances in the long term. That is a good thing that gives us strong finances," she said. "But exceptional times require exceptional measures and we are in an exceptionally dangerous security situation right now." These are the first moves of what promises to be the big political debate in Sweden, as in other European countries, over the next few years: should defence spending be funded by cuts to welfare and public services, hikes to taxes, or ‒ most likely ‒ both? It remains to be seen how bold each side is willing to be. Advertisement What else has been happening in Swedish politics? Centre party finance spokesperson in the ring for leadership Martin Ådahl, the Centre Party's finance spokesperson, has declared himself open to joining the race to become the party's next leader, while stopping just short of throwing his hat into the ring. Ådahl said the party should refuse to choose sides between the two blocks before the votes are counted in the 2026 election, and should stick with a promise not to join a government dependent on the Sweden Democrats. Instead, he said, the party should focus on jobs, enterprise, spurring growth and investing in roads, railways, healthcare, schools, and the green transition. Ådahl said he couldn't yet confirm if he would be a contender, but was "honoured that he had received the question from members". The MP Elisabeth Thand Ringqvist and the head of the farmers' union, Anna-Karin Hatt, have also refused to rule themselves out. Environment minister snubs climate council report release Sweden's environment minister Romina Pourmokhtari has decided not to attend the release of the Swedish Climate Policy Council's annual report on whether the government is doing enough to put the country on track to meet its climate goals at a press conference on Thursday. Daniel Helldén, joint leader of the Green Party described her no-show as " otroligt anmärkningsvärt", or literally "unbelievably worthy of note". This may sound mild when translated into English but in Swedish it's relatively harsh. "This shows that the government really isn't prioritising the climate issue. I've never heard anything like it."
