Next recession will hit foreign-born

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.

Government proposes higher pension age

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.

Vattenfall working for green transformation in Germany

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. (

Government prepares for Brexit deal

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.

CD calls for change in labour legislation

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.

Dispute over council’s independence

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.

Concerns raised over tax proposal

Earlier this year a government-commissioned inquiry proposed that real estate sales in so-called packaging companies should no longer be tax exempt. The CEOs of Swedish property companies, who were asked to comment the proposals, have now submitted their findings to the Ministry of Finance and the general consensus is that a tax hike of some SEK 17 billion on the sector would curb construction, create financial unrest and cause rents to soar.

Disagreement over coal-powered plants

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”.

India wants Sweden’s help to grow

For the first time India’s government is arranging the business seminar, Make in India, outside of India, and it will take place in Stockholm. India’s Commerce and Industry Minister Suresh Prabhu is in Sweden together with a delegation of several hundred representatives of India’s government and business. He is meeting representatives of the Swedish government, such as Prime Minister Stefan Löfven and Trade Minister Ann Linde and will also participate in Make in India. The aim is to encourage companies within 25 specific industries to station their manufacturing in India.

Speaking to Dagens Nyheter (DN) he says, “We are trying to liberalise for foreign investment more and more. There are openings within all industries.”

Finance Minister and IMF

According to Finance Minister Magdalena Andersson, the International Monetary Fund (IMF) shares a view on several issues with the Swedish government, for example concern over the housing market.

She is also grateful for the IMF’s praise for her economic policy. “We are on the same wavelength when it comes to the need for inclusive growth,” she says.

Magdalena Andersson is to attend the IMF’s autumn meeting in Washington and will visit the White House to meet US President Donald Trump’s international advisor.