• Sweden's news in English

Dark future forecast for Swedish economy

The Local · 20 Jan 2015, 15:01

Published: 20 Jan 2015 11:01 GMT+01:00
Updated: 20 Jan 2015 15:01 GMT+01:00

Facebook Twitter Google+ reddit
The figures contrast with her autumn prediction of a 3.0 growth in 2015, rising to 3.2 percent the following year.
Speaking after the announcement, she told Swedish media that she was looking to implement "new reforms" designed to improve the situation, but added that it would be "inappropriate" for Sweden to follow other European countries and introduce tough austerity measures.
The government has already announced that it plans to raise taxes, although this will most likely not be possible until November 2015, due to the complex December Agreement that the Social Democrat-Green coalition government struck with the centre-right Alliance parties after it failed to get its budget passed at the end of last year.
When Andersson has discussed the country's finances in recent months, she has used a metaphor which sounds strange in both Swedish and English: "the barns are empty". On Tuesday she said the barns were now "bleeding" too.
"In the short term, we see that Swedish growth has still not really taken off. The slow recovery abroad is holding back growth in the Swedish economy," she added.
Andersson also suggested that lower household spending than previously predicted coupled with rising costs linked to sick leave and migration in Sweden were putting a strain on the country's finances.
While recent unemployment figures suggested that more Swedes are now in full time work than a year ago, Andersson also said that she expected the country's jobless rate to be higher than previously predicted.
She suggested that a rate of 7.7 percent was likely in 2015, up 0.4 percentage points on her autumn prediction.
But she said that her Social Democrat party's goal that Sweden should have the lowest unemployment rate in the EU remained unchanged.
"We will not abandon the goal, but it is more challenging than before," she said.
Earlier this month, Danske Bank, which is one of the largest financial enterprises in the Nordic region, argued that falling oil prices and deflation could affect Scandinavian economies which had previously managed to weather the storm of the global banking crisis, including Sweden.
Story continues below…
"This does not mean that there are signs of economic crisis...but growth rates are heading towards the European average and downside risks have increased," said Steen Bocian, the lead economist who worked on the report.
"It's not looking better than in the autumn, quite the opposite. The money has run out," Magdelena Andersson said at a later press conference on Tuesday.
Annika Winsth, chief economist another of the region's key banks, Nordea added to the AFP news agency: "The government now has a forecast that is much in line with ours".

For more news from Sweden, join us on Facebook and Twitter.

The Local (news@thelocal.se)

Facebook Twitter Google+ reddit

Today's headlines
US election
Donald Trump won't get new Ericsson head's vote
Trump pictured at a campaign rally in Florida. Photo: Evan Vucci/AP

The new Swedish-American boss of telecoms giant Ericsson has revealed he will not vote for the Republican nominee in the forthcoming US presidential election.

Swedes named fourth most gender equal in the world
A file photo of men and women pushing prams in Stockholm. Photo: Claudio Bresciani/TT

Sweden has closed 81 percent of its overall gender gap according to the World Economic Forum.

Sweden: Russian warships in the Baltic 'worrying'
Swedish Defence Minister Peter Hultqvist. Photo: Vilhelm Stokstad/TT

Two Russian warships equipped with long-range missiles have entered the Baltic Sea after passing Denmark.

Why businesses are worried about Sweden's drone ban
A drone filming in Stockholm. Photo: Pontus Lundahl/TT

The Local investigates what Sweden's new drone ban could mean for businesses in the country.

This is the new top boss of Swedish Ericsson
Börje Ekholm. Photo: Magnus Hjalmarson Neideman/SvD/TT

Telecoms giant Ericsson has appointed a new CEO after a turbulent year for the company.

These are Sweden's best universities: ranking
A new university ranking has been released. Photo: Cecilia Larsson Lantz/Imagebank.sweden.se

At least according to this global ranking, which picks 12 Swedish universities among the top-1000.

Swedish pharmacies restrict paracetamol sales for teens
The move is intended to cut paracetamol overdoses. Photo: Nora Lorek/TT

Sweden's pharmacies are banning teens under 18 from buying more than one pack of pills at a time.

The Local List
12 Swedish words with just awesome literal translations
A filthy-minded lobster, i.e. a snuskhummer. Photo: Gorm Kallestad/NTB scanpix/TT

One of our favourite things about the Swedish language is its wonderful compound words, which range from being utterly bizarre to making perfect sense.

Rwandan genocide suspect held in Sweden
A memorial centre in Kigali, Rwanda. Photo: Ben Curtis/AP

A man has been arrested in Sweden suspected of involvement in the 1994 Rwandan genocide which claimed 800,000 lives.

Sweden can extend border controls, EU says
A police officer carrying out a check at Sweden's border with Denmark. Photo: Emil Langvad/TT

EU countries including Sweden should be granted permission to extend temporary border controls by a period of a further three months, the European Commission has decided.

Sponsored Article
Stockholm: creating solutions to global challenges
Sweden cuts 2016 refugee forecast
Sponsored Article
Last chance to vote absentee in the US elections
Is Game of Thrones coming to Sweden?
Property of the week: Kungsholmen, Stockholm
Blog updates

6 October

10 useful hjälpverb (The Swedish Teacher) »

"Hej! I think the so-called “hjalpverb” (auxiliary verbs in English) are a good way to get…" READ »


8 July

Editor’s blog, July 8th (The Local Sweden) »

"Hej readers, It has, as always, been a bizarre, serious and hilarious week in Sweden. You…" READ »

Sponsored Article
This is Malmö: Football capital of Sweden
Will Swedes soon be looking for fairtrade porn?
Sponsored Article
Where is the Swedish music industry heading?
The Local Voices
'I simply don’t believe in nationality'
Why we're convinced Game of Thrones is based on Sweden
People-watching: October 21st-23rd
Sponsored Article
Why you should 'grab a chair' on Stockholm's tech scene
Fury at plans that 'threaten the IB's survival' in Sweden
Sponsored Article
Swedish for programmers: 'It changed my life'
Analysis & Opinion
Are we just going to let half the country die?
Angry elk chases Swede up a lamp post
Sponsored Article
Top 7 tips to help you learn Swedish
The Local Voices
'Alienation in Sweden feels better: I find myself a stranger among scores of aliens'
Sponsored Article
‘Extremism can't be defeated on the battlefield alone’
People-watching: October 20th
The Local Voices
A layover at Qatar airport brought this Swedish-Kenyan couple together - now they're heading for marriage
Sponsored Article
Stockholm: creating solutions to global challenges
Swede punches clown that scared his grandmother
Sponsored Article
Why you should 'grab a chair' on Stockholm's tech scene
Fans throw flares and enter pitch in Swedish football riot
Sponsored Article
Where is the Swedish music industry heading?
Could Swedish blood test solve 'Making a Murderer'?
Sponsored Article
One expat's strategy for making friends in Stockholm
Swedish school to build gender neutral changing room
Sponsored Article
Nordic fashion in focus at Stockholm University
People-watching: October 14th-16th
Man in Sweden assaulted by clowns with broken bottle
Nobel Prize 2016: Literature
Watch the man who discovered Bob Dylan react to his Nobel Prize win
Record numbers emigrating from Sweden
People-watching: October 12th
The Local Voices
'Swedish startups should embrace newcomers' talents - there's nothing to fear'
How far right are the Sweden Democrats?
Property of the week: Triangeln, Malmö
The Local Voices
Syria's White Helmets: The Nobel Peace Prize would have meant a lot, but pulling a child from rubble is the greatest reward
jobs available