Sweden Quick Facts
- Capital: Stockholm Population: 9,666,871
- Language: Swedish
- Religion: Evangelical Lutheran
- Area: 450 000 km²(176, 000 sq mi) the third biggest country in Western Europe
- Currency: Swedish Kronor (SEK)
- GDP (Purchasing Power Parity): 372.765 Billion
- GDP per capita: $39, 100 (2010)
- GDP real growth rate: 5.5 % (2010)
- GDP by Sector: o Agriculture: 1.6 % o Manufacturing: 26.7 % o Services: 71.6 %
- Local Time: GMT + 1 hour
- Dialing code: + 46
- Main export partners: Germany 10 %, Norway 9,3 %, UK 7 %, USA 6,4 %, Denmark 6 % (2011)
- Main import partners: Germany 18,3 %, Norway 8,5 %, Denmark 8 %, Netherlands 6,2 %, UK 6 % (2010)
- Exports: electronics and telecom products, machinery, paper, pharmaceuticals, steel and food
- Imports: electronics and telecom products, crude oil, chemicals, textiles and shoes
- Government: Constitutional Monarchy, Parliamentary Democracy.
… 80 percent of the GDP is produced by the Swedish business sector, the rest is mainly coming from the public sector.
With its access to new technology and thriving business, Sweden has been crucial for foreign investors seeking opportunities in trade. Sweden also offers a vital location, serving as a gateway to three distinct markets: Scandinavia (25 million consumers), Baltic Sea Region (100 million consumers), and the European Union (350 million consumers). Sweden serves as an ideal spot for conducting high value-added operations in goods or services or for establishing competency centers to serve the entire region.
In addition to location and technology, Sweden attracts numerous foreign investors due to its highly-educated populace and global business mindset. In 2008, Sweden had the second most private equity investments as a percentage of GDP in all of Europe (Source: European Venture Capital Association).
Business Practices and Culture
When you compare many of its trading partners, Sweden’s business life is more relaxed and egalitarian. A boss is thought of as one of the team, decisions are reached by consensus, the vacations are long, and the coffee breaks are sacred.
Egalitarianism is a key theme in Swedish society and is an important factor in the office. It’s rare to see an executive dining room, and the boss’s desk often stands next to those of his or her employees. Egalitarianism also shines through in the consensus approach to decision-making. While passion, argument and the slamming of fists on desks are part of everyday business in some cultures, they are alien to the Swedish management style. Instead of getting a finger poked in their chest, employees are asked their opinions on important decisions. This love of consensus is apparent from the vast number of meetings in the average working day. It may seem excessive to the outsider, but it allows everyone to have their say.
Women are often found in leadership positions; about one in five board members and one in three managers in Swedish listed companies is a woman. While this is still not total gender equality, it is double the European average. A World Economic Forum report has called Sweden and its Nordic neighbors “top performers and true leaders” on gender equality.
Business dress is on the casual side – you will not see many suits on the train during the morning commute – and everyone is strictly on first-name terms, regardless of their place in the company hierarchy.
Swedes are often envied by their colleagues or counterparts overseas for their work-life balance. Sweden has one of the world’s most generous systems of parental leave, and many employees use flextime to fit in a trip to the gym in the morning or to pick up the kids straight after school. Don’t expect to get much business done with a Swedish company over the summer months – and July in particular – because most Swedes take between four and six weeks off during the summer.
In between the long holidays, the early finishes, the long stretches of parental leave and the back-to-back coffee breaks, your average Swedish worker still manages to be remarkably efficient and contributes to making the country rich, innovative and successful.
The Swedish business climate is known for flat organizational structures and managers who are not afraid to roll up their sleeves. Handshaking is the standard greeting. Swedes do not use many gestures. Keep your voice tone modulated. Swedes are relatively quiet people. Swedes are immediately on a first-name basis with one another, regardless of sex, age, social position or job title. Be punctual at all time to both business and social events. Do not show emotion during negotiations. Humor is not usually part of negotiations, Swedes tend to be serious in general, and many may appear forthright in business. Business meetings will usually start on time and will cut immediately to business instead of small talk which is common in other countries. English is the second language of business in Sweden and is widely used. In most sectors business meetings should be arranged well in advance. Most Swedes also draw a distinct line between working life and private life. They tend to be serious and honest in negotiations. Swedes have responsibilities towards families and other social groups and therefore it is considered unreasonable to expect them to work an excessive amount of overtime. Swedes are entitled to a 5 weeks holiday per annum.
Doubling Swedish Exports in 5 Years
Sweden and the U.S. have many things in common, even their export objectives; both countries have set out to double their export in five years, until 2015. The Swedish Minister for Trade Dr. Ewa Björling took part in a luncheon with corporate members of Swedish-American Chamber of Commerce (SACC) in Washington DC at the end of September. There, she acknowledged SACC’s initiatives and shared her view of Sweden’s exports – successfully on track so far.
– Sweden has to increase the export by 15% in average each year in order to reach the target 2015. Last year we reached 14%, and the first six months of 2011 looks promising, says Minster Björling.
The state of the global economy is still fragile, and it will not be easy for either Sweden or the U.S. to reach their targets. Exports can be stimulated by a number of initiatives; Dr. Björling emphasizes free trade agreements as a key issue that she fights for:
– Finalizing the Doha Round will have a huge impact on ours and many other countries – we cannot give it up” she says. A conclusion of the Doha Round would be, in Sweden’s opinion, the best way of securing open markets and increased international trade.
Regional free trade agreements are also very important; the recent agreement between EU and South Korea will give a significant boost to the trade between those markets.
The U.S. is Sweden’s 4th largest export market. Exports increased by 31% in 2010 compared with 2009, while imports decreased by 3%. Read more in an interview with the Swedish Minister of Trade
Sweden is a constitutional monarchy with a parliamentary democracy. The parliamentary system has been in operation since 1917, but did not become a constitutional law until 1974, when the monarch’s task to represent the country became officially limited. Female succession to the throne was introduced in 1980. The Constitution states that all public power is for the people, represented by the members of parliament. The parliament has 349 members and they are appointed for four years terms.
Some 7 million people in the country are entitled to vote; they determine which political party will represent them in the parliament, county councils and municipalities. The 349 members of the parliament make the decisions and the Government implements those decisions. The Government may also submit proposals for new laws or amendments to laws for a parliamentary vote. In the latest election, in September 2010, Fredrik Reinfeldt became the first conservative Prime Minister to win a reelection. Election turnout is quite high by international comparison; although it has fallen to in recent decades, it remains very strong at about 80 percent of eligible voters.
Swedish governance as a whole follows a decentralized model. On a local and regional level, municipalities and county councils are autonomous political bodies with clearly defined areas of responsibility. Municipalities deal with city planning and schools, for example, while county councils are in charge of areas such as healthcare and infrastructure.
Sweden has been a member of the EU since 1995. Thus many new laws enacted in Sweden originate from EU directives.
Current Economic Challenges and Opportunities
Presently, there is a great deal of disturbance to the European economic environment, mostly due to the fiscal crisis stemming from the economic troubles in countries such as Greece and Spain, and their problems regarding liabilities and interest rates. To avoid severe economic consequences or even bankruptcy, the IMF (International Monetary Fund) and some European countries had to provide emergency loans to Greece and Spain As part of IMF, Sweden had to contribute as well. Although the financial troubles of these countries are not directly linked to Sweden, they are making the economic outlook in the whole European Union uncertain. Consequently, Sweden is seeing some of the negative effects. However, Sweden does not itself have such internal solvency issues, and has for the past several years managed to shield itself from the worst economic disruption. One big difference between the US and Sweden regarding the past recession, for example, was the absence of sub-prime housing mortgages. This is one of the major factors for why the downturn was so extensive in the US, while it was fairly mild in Sweden. Another protective strength was the large budget surplus in Sweden.
Additionally, and in contrast to most other EU countries, Sweden possesses its own currency. Although this means Sweden could rely on the other Eurozone countries if it had a struggling economy, it also provides greater flexibility; this autonomy has allowed Sweden to escape some of the recent troubles of the Euro.