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Chinese firms invest in Sweden

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11:26 CET+01:00
Last year saw a major increase in foreign investment in Sweden. Most of the money originated in China, USA, Germany and Norway, according to Invest in Sweden Agency (ISA).

Companies based in the growth economies of China and India, as well as Norway, accounted for the largest increase.

In a report to be presented to the government on Wednesday, ISA claims to have contributed to a 38 percent increase in investment in 2006 compared to the previous year, creating 1,700 new jobs.

"In China there is a pressing need for companies to 'go abroad', and the government there has urged them to do so," ISA's director general Kai Hammerich told news agency TT.

In 2004 Chinese foreign investment amounted to 6 billion dollars. Last year that figure rose to 20 billion dollars.

Hammerich predicts a similar development in other growth economies, such as Thailand, Malaysia, South Korea, Brazil and South Africa. As he sees it, there are two reasons for companies to come to Sweden.

"On the one hand they want a base for their products in northern Europe and the Baltic region. On the other hand they are tempted by technological skills in the fields of life science and IT," said Hammerich.

It is not only companies from the new growth economies that are moving to Sweden. French-owned Tech City Solutions has opened a call centre in Söderhamn. Why choose Sweden for a call centre?

"Language skills. There are not many people who can speak Finnish, Danish or Estonian in low-cost countries," said Hammerich.

Ten years ago there were 3,600 foreign-owned companies in Sweden compared to today's 10,400. A full 23 percent of people employed in the private sector work for foreign-owned companies.

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