Kjos urges talks with Russia

 

Bjoern Kjos, the boss of Norwegian, has talked for a long time about making Stockholm’s Arlanda airport the hub for the budget airline’s long-haul flights to Asia, on the assumption that Norwegian will be able to fly over Russia.

Mr Kjos has urged the Swedish government to negotiate a new fly-over agreement with Russia, since Sweden, Norway and Denmark’s present agreement really only applies to SAS.

“If the Swedish government wants a major hub in Stockholm then they can have one. But we must also be allowed to fly over Russia. The Swedish government appears to be interested, but Denmark and Norway prioritise SAS more,” he tells SvD, suggesting that the government should be bold enough to sidestep its Scandinavian neighbours in order to create thousands of new jobs in the Stockholm region.

Nordea facing increased capital requirement

 

The Riksbank may be forced to bolster Sweden’s foreign currency reserves, the reason being that Nordea Bank AB is to merge its wholly owned subsidiaries Denmark, Finland and Norway with the parent company in Sweden. The Swedish Financial Supervisory Authority has said the mergers will not lead to an increase in the risks associated with public interest and creditors in Sweden (ed.), but Riksbank deputy governor Cecilia Skingsley is of a different opinion, and wants the bank’s capital requirement increased. “I do not understand why taxpayers should have to bear the burden,” she tells Dagens Nyheter.

Sweden must do more

Sweden ranks as the third most innovative country in the World Intellectual Property Organisation’s comparison of 140 countries but Mikael Damberg, the Swedish enterprise and innovation minister, is less than happy. He says Sweden ranks highly thanks to its investment in R&D, but the country is merely average in terms of what it gains from new innovations, products, services and growing companies.

The government is drawing up a number of measures to improve innovative ability; for example, the Ministry of Enterprise has presented an industry digitalisation action plan and set up a new structure for state venture capital funding, Fondinvest AB.

However, the question is whether the government is doing enough. Sylvia Schwag Serger, director of international strategy at Vinnova, says the government cannot rest on its laurels, and that Sweden must do more to attract innovative companies and talent from abroad. Sweden also needs to invest in education, adapt its graduate programmes to a changing world, and become better at selling system solutions to other countries, she says.

Authority will not appeal ruling

The Swedish Economic Crime Authority (Ekobrottsmyndigheten, EBM) says it will not appeal Stockholm City Court’s decision to acquit five bankers accused of involvement in the collapse of HQ Bank.

EBM has suffered a loss of prestige as a result of the court ruling, suggests DI, reporting that less than 50 per cent of senior management in Sweden has any confidence in the authority

New financial crisis in offing

Speaking in Almedalen on Thursday, Martin Flodén, deputy governor of Sweden’s Riksbank, said he was worried about the European banking system, and that many European banks were only just keeping their heads above water, burdened by toxic loans. “The risk is that Britain’s decision to leave the EU will be the straw that breaks the camel’s back,” he said, expressing concern that Europe could be on the brink of a new financial crisis.

Mr Flodén said the Riksbank could provide liquidity in the event of a crisis, but admitted that monetary policy was already expansive, and interest rates could not be cut much further.

Unofficial meeting at Steninge palace

One month ago US and North Korean diplomats met at Steninge palace on the outskirts of Sigtuna. The meeting, which the Stockholm International Peace Research Institute (SIPRI) helped organise, has been kept secret from the Swedish media.

However, according to information in the South Korean press ahead of the meeting, Pyongyang was expected to send Han Song Ryol, the head of the US desk at the North Korean foreign ministry, and the US was expected to send Thomas Pickering, former US under-secretary of state for political affairs during the Clinton administration.

Time for EU to start delivering

Anders Borg, the former finance minister, has warned of lower growth in the wake of Brexit and wants to see structural reform in Europe, which is lagging behind China and India, where GDP growth is around 5-6%.

Risk has increased following the UK’s referendum, and it is time for the EU to deliver on growth and jobs. “We are not just going to see strong opposition to the EU in the Netherlands and Austria, we will see it in Germany and France as well,” he said in Almedalen on Tuesday.

Mr Borg, who is an advisor to Citi, also said that Sweden needed to sort its housing market out and called on Peter Eriksson, the housing minister, to re-start cross-party talks. He even advised Swedish politicians to take a trip to Finland to study the labour market there.

The former minister stressed the need for Sweden to boost growth, believing that if the country could return to growth of 2.5%, living standards would increase two-fold within 30 years.

Free trade agreement with UK

Finance Minister Magdalena Andersson believes the EU should seek a bilateral free trade agreement with the UK, similar to the one it has with Switzerland. This would provide an opportunity to find the right balance between Britain’s rights and obligations.

The minister believes too much importance has been given to the timeframe of Brexit, saying it is important the negotiations are successful. At the same time she sees no point in dragging out talks, since this would harm economic activity, particularly in the UK.

Create simple jobs

CEO and chair of the Confederation of Swedish Enterprise, Carola Lemne and Leif Östling, write in DI today that 460,000 jobs must be created in the next few years if Sweden is to meet the government’s target of having the EU’s lowest unemployment by 2020. They write, “For various reasons, such as age, “education first and job later” is not the right solution for everyone. The alternative to several more years at a school desk cannot be being consigned to benefit dependency. There must be more paths to jobs.”

They highlight reform proposals such as creating introductory jobs for immigrants, increasing flexibility in SFI (Swedish language courses), developing job matching, extend RUT and ROT deductions, making it possible for asylum seekers to work, redistributing resources to vocational courses and opening up the Public Employment Agency to competition.

“If 100,000 more new jobs are to be created and contribute to Sweden’s growth more efforts are needed than what the government has so far demonstrated”.