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Successfully investing in Sweden

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​​​last updated on 7 June 2024 | reading time approx. 4 minutes

 

    

 

How do you assess the current economic situation in Sweden?

After a recession last year, a slight recovery in the economy is forecasted for 2024. Here are some key points from the current forecasts:
  • Real GDP growth is estimated at 0.2 percent in 2024, an upward revision from the fall forecast.
  • Riskbank has raised interest rates to 4 percent to curb inflation. Inflation is expected to be 1.7 percent. The risk of persistently high inflation is considered low.
  • The labour market should remain relatively resilient. Many companies are trying to retain their workforce. The unemployment rate should therefore not rise above 8 percent by 2025.
  
The Swedish krona will probably remain vulnerable in the short term, but the chances still prevail, as both interest rate differentials and purchasing power parities indicate that the currency is undervalued.

  

How would you describe the investment climate in Sweden? Which sectors offer the largest potential?

Sweden is taking proactive measures to create an attractive investment environment while addressing the challenges of a changing global market. The government's strategy suggests that Sweden aims to consolidate and improve its position as an attractive location for investment, strengthen the country's competitiveness and create favourable conditions for trade, investment and innovation.

As a relatively large country with a low population density, special solutions and investments in the area of infrastructure are required. The expansion of high-speed Internet connections in remote areas is therefore of great importance.
  
A large part of the public investment is planned in the area of digitalization, including in education and training and at universities to improve digital skills. Sweden has highly qualified engineering talent and leading IT skills in systems integration, automation and mobile solutions.

Both the public and private sectors are investing heavily in green tech and sustainability, such as the expansion of wind farms. In 2017, Sweden passed a climate change law aiming for net-zero emissions of greenhouse gases by 2045. The country should use 100 percent fossil fuels to generate electricity by 2040.

But the traditional automotive industry is also working hard to electrify its range of vehicles. At the same time, a number of startups are developing innovative solutions for the transport of people and goods.

    

What challenges do German companies face during their business ventures into Sweden?

German entrepreneurs who want to get involved in Sweden may encounter various challenges:
  • Regulatory differences: German entrepreneurs need to familiarize themselves with the specific regulatory requirements in Sweden, which may differ from those in Germany.
  • Cultural and linguistic barriers: Although Sweden has a high level of English proficiency, cultural differences may require some knowledge of Swedish.
  • Competitive environment: Sweden has a very innovative and competitive economy, which means that new entrants have to compete against established local companies.
  • Digitalization: Advancing digitalization requires companies to constantly adapt and integrate new technologies. Rapid development can pose a challenge for companies.
  • Pressure to innovate: Companies, especially SMEs, are under pressure to increase their innovative power in order to keep up with global competition.
  • Labour market: The shortage of skilled workers makes it more difficult to attract and retain qualified employees. Companies must create attractive working conditions in order to attract talent.
  • Regulatory adjustments: Companies must adapt to the constantly changing regulatory framework.
  
It is important that German entrepreneurs recognize these challenges and develop appropriate strategies in order to operate successfully in Sweden.

    

Why is Sweden said to be one of the happiest nations in the world?​

Sweden is regularly ranked as one of the happiest countries in the world. In the World Happiness Report 2023, which is based on data from 2020 to 2022, Sweden occupies one of the top places (Finland No. 1, Sweden No. 6, Germany No. 16). There are many reasons for the high level of life satisfaction in Sweden:
  • Social support: Sweden has a strong social network that provides security and support for citizens.
  • Economic stability: The Swedish economy is robust and offers its citizens a high level of financial security.
  • Healthcare: The healthcare system in Sweden is comprehensive and accessible, which contributes to a high life expectancy.
  • Education: A high-quality education system ensures equal opportunities and promotes well-being.
  • Environmental quality: Sweden places great value on environmental protection and sustainability, which contributes to a high quality of life.
  • Work-life balance: Sweden promotes a healthy work-life balance that allows people to balance work and leisure.
  
Sweden shows that a combination of good governance, strong social networks and a high priority on well-being and sustainability can lead to a happy population.

   

In your opinion, how will Sweden develop?

In 2024, Sweden will face a number of developments that will shape the country economically, politically and socially:
  • Economic outlook: Sweden is expected to slowly emerge from the economic slump in 2024, further diversify its economy and invest in key areas such as technology, renewable energy and cleantech.
  • Foreign policy: Sweden will further strengthen its relations with the Nordic and Baltic countries and pursue the vision of being the world's most integrated and sustainable region by 2030.
  • NATO membership: Sweden's membership in NATO is expected to lead to deepening dialogue and cooperation in the region.
  • Social development: Sweden will continue to maintain high standards of education, healthcare and social equality, which contribute to the overall quality of life.
  
These developments show that Sweden is committed to consolidating its role as a progressive and sustainable nation and further expanding its position on the global stage.​

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