Sweden - Future trends

Sweden is expected to preserve its healthy economy and high living standards into the foreseeable future, although the EMU membership controversy will continue to considerably influence domestic politics. In January 2001, Sweden took over the 6-month rotating EU presidency, but opinion polls showed that only half of the electorate wanted the country to remain in the European Union. Economic growth is likely to slow from 4 percent in 2000 to 3.5 percent in 2001 and 3.2 percent in 2002; inflation is projected to remain moderate and under control, while the unemployment rate will likely continue to fall. The Swedish trade surplus is likely to increase in 2001 due to the expected decline in oil prices and continued growth in exports. A decrease in the U.S. consumer spending may reduce Swedish exports to that major market in 2001, but exports to the EU will continue to grow steadily.

In the longer run, the restructuring of the Swedish economy will give further priority to information technology and other high-tech industries and, increasingly, financial services at the expense of traditional engineering industries. The living standards of the Swedes will continue to rise, although more slowly than in the late 1990s, and the government will put major efforts in planning for its eventual entry into the EMU in order to avoid negative effects on employment and welfare. Sweden will also continue to provide an important economic and social model, especially for the new EU members.