Housing Minister Peter Eriksson is doubtful about the new amortisation requirement and believes other alternatives ought to be considered.
On Monday the Financial Supervisory Authority (FSA) is expected to make a decision about whether to introduce new tougher amortisation requirements. The issue is a difficult decision for the government as giving the go-ahead could entail risks, but stopping the proposal would undermine the FSA.
On Wednesday Financial Markets Minister Per Bolund (Green) criticised the opposition, calling its stance against the proposal “irresponsible”. However, party colleague Peter Eriksson expressed his uncertainty. “I think the amortisation requirement that was brought in recently has had mainly a positive effect. In the situation we have now it is more uncertain. I think that other possible measures ought to be considered,” he says. His main concern is that it would slow down housing construction.
The Paradise Papers leak has stirred up the Swedish business world. Chair of the Confederation of Swedish Enterprise Leif Östling is one of those who placed funds in the tax havens of Malta and Luxembourg, and has defended his actions. He says he has paid SEK 84 million in income tax and SEK 23 million in capital gains tax in Sweden, plus SEK 70 million in Germany and claims he is following rules with his funds in Malta and Luxembourg.
Now there are calls from within the business sector for Östling to resign. One source from within the confederation says there is a risk that businesses will leave the organisation. Maria Mattsson Mähl, CEO of Alpha CE and recently nominated to the confederation’s board believes Östling’s comments damage the organisation. “Most members are working hard to pay taxes and make ends meet,” she says.
However among one of the organisation’s heavyweight representatives, support is intact. “He is speaking as a private person, so our confidence in Leif is unchanged,” says Klas Wåhlberg, CEO for the Association of Swedish Engineering Industries.
Via Skype, US Secretary of Commerce Wilbur Ross participated in a lunch with the Swedish-American Chamber of Commerce in New York on Tuesday. The US is Sweden’s most important trade partner outside the EU, and Wilbur Ross says he is prepared to resume the paused TTIP negotiations.
Sweden’s Minister for Enterprise Mikael Damberg also participated in the lunch and will meet Wilbur Ross today, Thursday. He does not share Wilbur Ross’s views of TTIP but says, “even if we have different views, it is important for us in the government to develop a relationship with this American administration”.
Wilbur Ross points out the major trade deficit – last year Sweden sold SEK 87 billion worth of goods and services to the US but imported only SEK 37 billion worth – although says, “We share many of our values with Sweden and have huge respect for the technical knowledge in the country.”
In a report based on new data from Statistics Sweden, which is presented today, the Liberals have looked at how the next recession will affect the most vulnerable on the Swedish labour market.
Writing in Dagens Industri (DI), economic spokesperson for the Liberals, Mats Persson, states that those who are currently unemployed come from two main groups: people born outside of Sweden and those who do not have an upper-secondary school education. The situation is particularly serious for foreign-born women; almost 30 per cent of women born outside of Europe of working age have no job.
The new report shows that in the past three recessions in Sweden since 1990, the employment rate among both groups has fallen by nine percentage points, which is around 250,000 people. Mats Persson writes, “A labour market that does not work for these groups during an economic boom is a labour market that knocks out many during a recession.” Political courage is needed to push through reforms for a labour market on which everyone is necessary.
Minister for Health and Social Affairs Annika Strandhäll (S) is aiming to table a proposition to raise the pension age next year. “I am not ruling out a proposal before the coming election,” says Annika Strandhäll.
The changes being discussed include raising the earliest pension age from 61 to 63. Additionally, employers will not be able to give someone notice before 69 years of age.
It is roughly one year since Vattenfall sold its four brown coal power plants and four open cast mines in Germany. The state power company was criticised in Germany for shrugging of its environmental and employment responsibilities and in Sweden for selling when brown coal was at its cheapest.
The company is working to abolish coal-powered energy by 2030. German Vattenfall is to invest over EUR 2 billion, around SEK 19 billion over the coming five years. “That is with growth within renewable energy and customer business, growth in distribution of power, gas and heating and redesign of our production park for heating,” says Tuomo Hatakka, head of Vattenfall GmbH, which is counting on the German government continuing to realign to greener energy. (
The UK is one of Sweden’s largest trade partners and if Britain were to leave the EU without a trade deal, Sweden would be badly hit. In the absence of a deal, the UK would be required to follow World Trade Organisation rules on tariffs, making future trade more expensive.
On Thursday the Swedish government therefore ordered the National Board of Trade (Kommerskollegium) to prepare Sweden’s priorities ahead of Brexit trade talks.
Both Brussels and London have been talking of a “no deal” Brexit recently but Social Democratic EU Affairs and Trade Minister Ann Linde says Sweden has not given up hope of an agreement.
The Christian Democrats (CD) have joined forces with the Moderates, calling for change in the Employment Protection Act (LAS). Talking to Dagens Industri (DI), party leader Ebba Busch Thor says: “It is obvious that there needs to be a major reform of LAS, which as it stands is doing more harm than good”.
Alliance cooperation has intensified since Ulf Kristersson was elected the new Moderate leader, and ventures to provide the electorate with a credible government alternative are increasing, she tells the newspaper.
A dispute has broken out between a number of Sweden’s top economists and the government, which wants MPs from the Committee on Finance to have a say as to who is to be appointed to Sweden’s influential Fiscal Policy Council (Finanspolitiska rådet).
The council, whose remit is to provide an independent evaluation of the government’s fiscal policy, has frequently criticised government policy.
Professor John Hassler warns that there is a clear risk of politicisation and that the council might as well close down.
Negotiations to revise the EU’s emissions trading scheme have reached a deadlock after the European Parliament rejected a bid from member states that would have seen EU funds being invested in the modernisation of coal-powered electricity plants.
While disappointed over the standoff, Jytte Guteland, a Social Democratic MEP and member of the European Parliament’s environment committee, is relieved that a responsible decision was taken.
One of the key points of debate is how to fund industry’s shift to cleaner power. Guteland says MEPs agree that EU funds cannot be used to “lock Europe into a fossil-fuelled future”.