Borg a surprise choice as finance minister

The choice the Moderate Party's chief economist Anders Borg as Sweden's new finance minister has surprised many analysts, although markets in Stockholm remained stable following the announcement on Friday.

The pony-tailed Borg is politically inexperienced, and few had expected him to get such a senior government job. But as a trained economist with a career behind him in the financial markets and the Riksbank, he is also one of the financial markets’ own men.

“It is positive that we’re getting someone who’s economically trained – an economist with a broad overview of structural policies. We haven’t had someone like that for a while. Neither [Bosse] Ringholm or [Pär] Nuder were economists, and it has shown. In the past five years we’ve barely had any structural policies to talk of,” said Ulf Torell, analyst at Swedbank.

Nordea analyst Torbjörn Isaksson said Borg’s appointment was “a little surprise. He was on the list of possible names, but he wasn’t highest on the list.”

Isaksson noted that there were question marks over Borg’s political inexperience.

“But he has a pretty solid economic background, with a past on the financial markets and at the Riksbank. He’s also one of the main people behind the Moderates’ new direction in economic policy.”

As for his political inexperience, it was unlikely to have much impact in the short term, as he would be implementing a programme that has already been decided, Isaksson thought.

“But in the longer term he could end up in situations that require authority and an ability to negotiate. If there is a question mark, then that’s where it is.”

Isaksson was disappointed that Reinfeldt didn’t give more detail of future finance policy in his speech to the Riksdag.

“We had thought that there would be more hints on the timing of advertised reforms and their costs. But there was very, very little that was new.”

Markets will be focusing in the near future on the sales of state-owned companies.

“We want to know in which companies stakes will be sold, in which order, when and in what way. After that, there will be interest in how the government will succeed in its job policies, increase the selection of jobs available and get employment up to higher levels. That will be interesting to see,” Isaksson said.