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.

IMF endorses Sweden’s economy

The board of the International Monetary Fund, IMF, has stated that Sweden’s economy continues to develop well but the government ought to deal with growing household debt. It predicts Sweden’s GDP to increase by 3.4% this year and 2.4% next year. The budget deficit is expected to be small this year and next year despite migration costs and investments in training and the labour market.

“Despite beneficial conditions on the labour market it still takes too long to get new arrivals into work, and unemployment is high among workers born abroad with little education,” writes the IMF. It also suggests reforms are needed to tackle the rise in house prices.

Sombre tone ahead of IMF meeting

At this weekend’s annual meeting of the International Monetary Fund in Washington, head Christine Lagarde will be urging finance ministers around the world to implement reforms to spur on inflation and growth.

However, Sweden’s Magdalena Andersson has no intention of expanding policy. Ahead of her trip to Washington she tells SvD: “We are pursuing a tight fiscal policy. We have chosen a different path”. The minister does add though that the leeway has increased somewhat, given the move to lower the surplus target level in 2019.

She believes a fairer distribution of profits is needed if the vicious cycle of sluggish global growth, populism and protectionism is to be reversed. Highlighting the way in which the widening gap between rich and poor in the United States creates frustration, she says: “the only way to reverse this is for politicians to ensure that the gains to be made from globalisation and free trade benefit everyone”.