Olof Persson succeeded Leif Johansson as chief executive of AB Volvo, Sweden’s largest industrial group, in 2011. Shortly after his appointment, Persson announced his intention to improve the group’s operating margin, which in 2011 was 8.7%. Instead, however, the operating margin has shrunk and Volvo shares have underperformed.
Dagens Industri now suggests that the Volvo board is planning to recruit a new chief executive and that Persson will be forced to step down within the next few weeks.
In the run up to last September’s general election, the Green Party said one of the first measures of a centre-left coalition government would be to stop Vattenfall from enlarging its lignite mines in Germany. Six months on, it’s business as usual at Vattenfall. Even if the Social Democrats and the Green Party have agreed that the state-owned utility must cut its carbon emissions, no new directives have been issued to halt the expansion plans.
So, what does the government intend to do? While the Green Party has called for the closure of the German coal operations, the Social Democrats have welcomed Vattenfall’s plans to divest the German coal business.
Moderate MP Lars Hjälmered is now demanding clarity from the government as to what it intends to do with the German business.
Defence Minister Peter Hultqvist has told public service broadcaster SVT that the government will be placing an SKr 8.2 billion order for two new submarines from Saab Kockums. The minister announced the news while visiting the Karlskrona shipyard on Tuesday, although a formal decision will not be made until Thursday. The submarines will be delivered in 2022.
Following Sweden’s cancellation of the defence co-operation agreement with Saudi Arabia, Foreign Minister Margot Wallström and Enterprise Minister Mikael Damberg have invited some 40 business leaders to a meeting on Thursday to discuss how export companies can develop their business in the Gulf States.
Dagens Industri (DI) reported last week the diplomatic row has meant that a number of companies have seen contracts being terminated. However, Swedish industrial group Sandvik has not been affected, according to chief executive Olof Faxander, who have been invited to the meeting, but who is unable to attend. He says to the business daily: “We believe that trade, openness and a presence in many countries around the world leads to economic development and improves conditions in those countries”. He expects Swedish firms will continue to develop their businesses in the region, which offers significant opportunities for growth.
The Swedish Peace and Arbitration Society (SPAS) has welcomed the Swedish government’s decision to cancel the defence deal with Saudi Arabia and is now calling on the government to scrap other agreements, such as the one Sweden has with Thailand. The co-operation agreement is linked to Saab’s sale of an integrated air defence system with Gripen fighter jets and the Erieye radar reconnaissance system.
Following the military coup last year, Thailand’s PM, General Prayuth Chan-ocha has promised elections will be held but Human Rights Watch recently noted that the country is descending deeper into dictatorial rule. And, for officials at the Swedish Ministry of Defence, the situation in Thailand is problematic.
“We are preparing the question, on what form of co-operation we should have,” a ministry spokesman says.
Sweden currently has military co-operation agreements with 32 countries.
The Swedish Riksbank has gone from being the best among its peers in 2008 and 2009 at forecasting inflation to lagging behind its peers in two-thirds of the predictions, writes Bloomberg after comparing forecasts by six central banks between 2008 and 2013. The Riksbank’s errors can be traced back to 2010 when Governor Stefan Ingves raised rates despite Europe being in the midst of the worst economic crisis since WWII, states Bloomberg.
Appearing before the Committee on Finance yesterday, Riksbank Governor Stefan Ingves tried to pour oil on troubled waters when he said a strong krona was unwelcome news in the current situation. Afterwards, he told the media that it would be helpful if the krona remained at current levels, in terms of bringing up inflation to the 2 per cent target.
Ingves also said the central bank was prepared to take further measures, although currency intervention was not his first choice.
The Silf/Swedbank Swedish Services Purchasing Managers’ Index (PMI) slipped to 56.7 in February from 57.9 in January, which had been expected. The business volumes sub-index rose while all other sub-indices fell.
Plans by the Swedish Post and Telecom Authority (PTS) to ensure telecom service providers provide continuity of service in the event of a power outage have infuriated the industry. TeliaSonera claims that back-up solutions would cost the operator hundreds of millions of kronor to put in place, while estimates suggest that Tele2 would have to invest half a billion kronor to provide such resilience.
Employer organisation the Swedish IT and Telecom Industries estimates the industry would need to invest two billion kronor in order to meet the criteria.