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Competitive open mixed economy
- Sweden is a competitive open mixed economy. The vast majority of Swedish enterprises are privately owned and market-oriented. There is also a strong welfare state, with public-sector spending accounting up to three-fifths of GDP. In 2014, the percent of national wealth owned by the government was 24%.
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Mar 7, 2024 · Today, Sweden has a diverse and highly competitive economy. In the the IMD World Competitiveness Ranking 2023 – which ranks 64 economies – Sweden came eighth. According to the World Bank , a key feature of the Swedish economy is its openness and liberal approach to trade and doing business.
- Overview
- Economy of Sweden
- Agriculture, forestry, and fishing
- Resources and power
- Manufacturing
- Finance
Sweden’s per capita gross national product (GNP) is among the highest in the world, but so are its taxes. Most enterprises are privately owned and market-oriented, but when transfer payments—such as pensions, sick pay, and child allowances—are included, roughly three-fifths of gross domestic product (GDP) passes through the public sector. Education, health care, and child care costs are primarily met by taxation. Government involvement in the distribution of national income, however, diminished over the last two decades of the 20th century.
With the value of exports amounting to about one-third of its GDP, Sweden is highly dependent on free international trade to maintain its living standard. In 1991 Sweden attached its currency, the krona, to the ecu (European currency unit, replaced in 1999 by the euro), but in 1992 Sweden abandoned its peg to the ecu and allowed the krona valuation to float. Sweden’s currency remained independent even after the country became a full member of the European Union (EU) in 1995. In 1999 an executive board of Sweden’s Riksbank was established to set monetary policy and sustain price stability. Sweden also has to cope with problems of competitiveness that have caused industry to invest much more abroad than at home. Most of Sweden’s large industrial companies are transnational, and some employ more people abroad than in Sweden, where production costs are high.
Sweden’s per capita gross national product (GNP) is among the highest in the world, but so are its taxes. Most enterprises are privately owned and market-oriented, but when transfer payments—such as pensions, sick pay, and child allowances—are included, roughly three-fifths of gross domestic product (GDP) passes through the public sector. Education, health care, and child care costs are primarily met by taxation. Government involvement in the distribution of national income, however, diminished over the last two decades of the 20th century.
With the value of exports amounting to about one-third of its GDP, Sweden is highly dependent on free international trade to maintain its living standard. In 1991 Sweden attached its currency, the krona, to the ecu (European currency unit, replaced in 1999 by the euro), but in 1992 Sweden abandoned its peg to the ecu and allowed the krona valuation to float. Sweden’s currency remained independent even after the country became a full member of the European Union (EU) in 1995. In 1999 an executive board of Sweden’s Riksbank was established to set monetary policy and sustain price stability. Sweden also has to cope with problems of competitiveness that have caused industry to invest much more abroad than at home. Most of Sweden’s large industrial companies are transnational, and some employ more people abroad than in Sweden, where production costs are high.
The growing season in Sweden ranges from about 240 days in the south to 120 days in the north. Less than one-tenth of Sweden’s land area is under cultivation. Most arable land is found in southern Sweden, but there are arable parcels up to the Arctic Circle. Wheat, barley, sugar beets, oilseeds, potatoes, and staple vegetables dominate in the south, while in the north hay and potatoes are the main crops. In Sweden as a whole, animal agriculture is more significant than cereal farming. Dairy cows are important in all parts of the country, while pig and poultry raising are concentrated in the extreme south. The yields of Swedish farms are among the highest in the world. Environmental problems, however, have made it necessary to reduce the use of fertilizers.
About half of Swedish forestland is privately owned, about one-fourth company-owned, and about one-fourth publicly owned. Forest work used to be complementary winter employment for small farmers using their horses; today forestry is carried on year-round by a small workforce and large, modern machinery. Nearly three-fourths of all Swedish farms have timberland. The average regrowth and harvest time for spruce and pine is about 50 years in the south and roughly 140 years in the north. Since the late 19th century, forestry in Sweden has been conducted on a sustained-yield basis, which establishes a ratio between cutting and new growth that is strictly enforced. Modern large-scale forestry methods have been subject to severe criticism, and major reforms were implemented in the 1990s. A thorough mapping and inventory of key woodland habitats was undertaken in the mid-1990s to identify areas with high biodiversity values.
Wood, metallic ores, and waterpower constitute the historical basis for Sweden’s industrial economy. The country is lacking in fossil fuels and must rely on imports for its needs. Hydroelectric power is used to a high degree but provides only about half of the electric energy needed; most of the rest is derived from nuclear power.
Sweden is well endowed with mineral resources. The huge state-owned iron ore deposits at Kiruna in Lappland were opened to export at the end of the 19th century. In the Boliden area of Norrland a wide range of metals, including gold, copper, lead, and zinc, are mined. The copper, silver, and iron ore deposits of central Sweden either have been largely exhausted or are unprofitable to extract.
Manufacturing is export-oriented and produces the bulk of Sweden’s export income. Nevertheless, the number of workers employed in private industry is smaller than the number of public employees.
Sweden is a major world exporter of forest products. Timber is transported via a dense road and rail network. Sawmills and pulp and paper factories process the forest products. Swedish manufacturers produce a variety of wood products, including paper, boards, and prefabricated houses and furniture. The pulp and paper industry developed originally at the mouths of rivers along the Gulf of Bothnia and Lake Väner. More recently, plants have been located on the coasts of southern Sweden.
Sweden’s metal industry still follows a pattern established during the days when waterpower and forestland (yielding charcoal fuel) determined the location of iron mills. The iron and steel industry is thus still largely found in the Bergslagen region of central Sweden. The iron and steel mills built in the 20th century, at Oxelösund and Luleå, are located on the coast.
Privately owned firms currently produce about nine-tenths of industrial output. Engineering, including the automotive industry, is by far the largest manufacturing industry, producing about half of industrial value added. The automotive and aerospace industries have their main plants in south-central Sweden. Swedish automakers Volvo and Saab enjoyed strong international reputations into the early 21st century (in 2011 Saab declared bankruptcy, but most of its assets were purchased by the start-up company National Electric Vehicle Sweden [NEVS]).
The Swedish banking system is dominated by a small number of major commercial banks. The bank of issue is the Swedish Central Bank, and the country’s currency is the Swedish krona. There also are savings banks, niche banks, and foreign banks active in Sweden.
Retrieved 3 October 2019. Today, Sweden has a diverse and highly competitive and successful economy. The World Economic Forum ranks Sweden among the top ten most competitive countries in the world. Sweden is also one of the easiest countries in the world to do business with, according to the World Bank.
YearGdp (in Bn. Us$ppp)Gdp Per Capita (in Us$ Ppp)Gdp (in Bn. Us$nominal)2027830.774,376.1808.72026799.272,080.3769.92025769.469,935.3732.62024738.267,666.3693.2Mar 11, 2024 · News In February, the International Monetary Fund (IMF) concluded its annual review of Sweden's economy, known as an Article IV consultation. The final report on Sweden's economy, which has been approved by the IMF’s Board of Governors, is now available on the IMF's website. The IMF’s report on...
Economic Survey of Sweden - 14 June 2023 After a relatively strong performance during and after the pandemic, short-term growth prospects are weak. High inflation has eroded real wages and tighter monetary policy has increased borrowing costs and led to a housing price correction.
Mar 29, 2023 · Sweden country profile. 29 March 2023. Sweden's position as one of the world's most highly developed post-industrial societies looks fundamentally secure. Unemployment is low and the economy ...
Oct 28, 2021 · Swedish GDP grew by 1.8% Q3 vs Q2. Economists expected growth of 1.3% Growth firmly above pre-pandemic level. STOCKHOLM, Oct 28 (Reuters) - Sweden's economy grew more quickly than expected in the...
