Tense wait for report

With France and Germany pushing for closer cooperation, the European Commission has outlined five scenarios for the future of the EU post-Brexit. Sweden has remained remarkably quiet about the white paper, but at lunchtime today the Commission is to release a report that has the potential to change this.

According a rumour in the German media last week, pressure will be put on Sweden to adopt the euro no later than 2025. The European Commission has denied that this is the case, but Roberg Bergqvist, chief economist at SEB, believes there is a grain of truth in the rumour.

Finance Minister Magdalena Andersson (S) is defiant, saying she will not accept a specific date. “It is up to the people of Sweden … to decide if and when Sweden adopts the euro. There is no other alternative,” remarks the minister, believing that there is understanding in the EU for this stance post-Brexit.

Digitalisation challenging postal services

Much remains to be done before PostNord can win back public trust, says Enterprise Minister Mikael Damberg (S) in a comment to a fresh report on postal services in Sweden.

The Swedish Post and Telecom Authority (PTS) has found that the number of complaints against PostNord and Bring Citymail has decreased since last year, but is still too high.

In the case of PostNord one of the problems is that the company has reduced the number of employees in a cost-cutting campaign, as more letters are sorted by machine. Longer postal rounds and the company organisation are also seen as contributory factors to the poor service.

Digitalisation is also challenging the postal services: the number of letters sent in Sweden has fallen since 2000, and PostNord has consequently lost market share. Bring Citymail’s problem is that the company has grown fast and not adapted its organisation to its increase in market share.

Sten Selander of PTS summarises, saying that when the quality of the postal service falls, more people go over to email.

Volvo gearing up for stock market

The preparations for listing Volvo Cars on the stock market have taken new, clear steps forward. Dagens Industri reports that CEO Håkan Samuelsson held an important meeting on Monday with major investors on the Stockholm stock market. “The meeting was a launch pad for important investors prior to a stock market listing later this year,” says a source with good insight.

During the meeting, Håkan Samuelsson highlighted the development of Volvo Cars’ new models and the company’s strategic goals.

The determining factor is whether Volvo Cars’ owner Li Shufu gives the go-ahead. According to DI’s sources there is an increasing likelihood that he will do so as there remains great interest from Swedish investors.

EU warns of house prices

Sweden risks a disorderly housing market correction, warns the European Commission in its annual review of the Swedish economy, reports Reuters. The risk comes from persistent house price growth and that the policy implemented by Swedish authorities has not been sufficient.

The Commission wants to see housing tax reforms, steps to increase the rate of new housing construction and deregulation that leads to a more effective use of existing housing stocks. The Commission recommends gradually lowering the tax deductibility of mortgage interest payments.

Nordea has decided to move

 

The issue of whether Nordea will move its head office to either Helsinki or Copenhagen has been a hot topic since the government presented its proposal to raise the resolution reserve fee. In March Nordea chair Björn Wahlroos said the higher fee could cost Nordea an extra SKr 5 billion, motivating a move.

Svenska Dagbladet reported on Saturday that sources have now confirmed that the decision has been made and all that remains is a formal decision by the bank’s board on 30 May. However Nordea’s head of investment Rodney Alfvén would neither confirm nor deny the reports.

Dagens Industri, DI, reports today that Finance Minister Magdalena Andersson denies that the Swedish state would lose any tax income if Nordea moves its head office. Nordea pays corporate tax in Sweden for its Swedish operations regardless of where its head office is situated.

Persson acquires more H&M shares

In the past week Stefan Persson, the chairman of H&M, has purchased shares in the fashion retailer to a value of SKr 2.3 billion. Despite this, the mood on the stock market is sour and H&M shares have tumbled by 32% in the past two years. The reason for the slide is said to be the surge in online sales.

“H&M mainly sells its clothing and accessories in shops, and we are seeing in-store sales drop across Europe due to the increase in online sales,” comments Christopher Lyrhem, SEB share strategist.

Bolund defends tax on chemicals

Sweden’s consumer electronics industry is in uproar over the news that the tax on chemicals, which will take effect on 1 July 2017, will only be levied on Swedish firms. Foreign online vendors selling goods to Swedish consumers will not be liable to the tax.

The Swedish trade association Elektronikbranschen is concerned over the amount of administration the tax will require, as well as the extra cost to consumers, saying the tax will distort the market.

Nevertheless, Financial Markets Minister Per Bolund (Green) defends the tax, saying if is “a tool to reduce the use of hazardous chemicals”.

Tax on chemicals

Sweden is introducing a new tax on chemicals within certain electronic products that are sold in or brought into Sweden. The tax will take effect on 1 July 2017 and will be levied on a range of white goods and electronic products, including computers and mobile phones. The maximum tax will be SKr 320 per product, and the government expects to collect revenues of some SKr 2 billion annually.

All legal entities bringing such products into Sweden will have to fill in a six-page tax form and pay the tax within 5 days. Large companies will be granted some leeway.

Electrolux, one of the firms affected by the new tax, is less than impressed, saying the legislation is laborious. The Swedish Catering Equipment Manufacturers and Distributors Association is also critical, saying the cost of administrating the tax will be far higher than the revenue the government expects to collect.

Andersson: Taxpayers tired of Nordea’s games

Finance Minister Magdalena Andersson has criticised the Danish government’s attempts to persuade Nordea to place its head office in Copenhagen. “It sounds as though the Danish government is prepared to compete by easing the rules on the finance market. That is a path that the Swedish government will not tread,” she said.

She has also berated CEO Casper von Koskull, saying “many taxpayers, who saved the bank in the 90s, are tired of Nordea’s games”.