Experts want new reforms

Several of the country’s leading economists consider there to be a desperate need for new structural reforms, but the government is showing no sign of dealing with the problems. The last real political structural reform was the employment tax deduction brought in by the alliance government in 2006.

In particular economists are worried about the housing and labour markets. Annika Winsth is head economist at Nordea and describes a generation of politicians that are incapable of taking on the major challenges that Sweden is facing just now. She is unimpressed with Finance Minister Magdalena Andersson’s autumn budget. “I think it is inappropriate to push forward with extensive stimulation when we already have the tendency to overheating. Furthermore, becoming bound to permanent increases in spending when you know that worse times lie ahead is risky. Long-term structural reforms would have been desirable,” she says.

Insufficient reform

Sweden’s poor performance in the PISA ratings, a decline the like of which has not been seen in any other OECD country in the past decade, poses a threat to the country’s competitiveness, warns the European Commission in its annual report.

The Swedish government receives praise for allocating more funds to education, but the poor performance of pupils with an immigrant background is a cause of concern.

The government is lauded for its efforts to simplify building procedures but its indecision over amortisation requirements is worrying. The Commission urges the government to give the Swedish Financial Supervisory Authority the necessary powers as soon as possible, warning that other measures will be needed to address Sweden’s imbalances.