Bulgaria’s defence ministry has recommended that the government start talks with the United States to buy new F-16 fighter jets.
Sweden, which has filed a bid to supply Bulgaria with 10 Gripen C/D fighters, adapted to comply with NATO standards, has been taken by surprise over the news.
Joakim Wallin, head of exports and international operations at the Defence Materiel Administration, FMV, said: “Bulgaria’s defence ministry has chosen a more expensive solution, to all appearances taking security policy rather than business considerations into account”.
The Riksbank is raising the repo rate to -0.25 per cent from -0.50 per cent. This is the first time since 2011 that the bank has tightened the key rate. The new rate comes into force on 9 January and the board’s motivation is that inflation has “become established” at around two per cent.
In a press release, the board writes that there is considerable uncertainty over global economic developments and inflation pressure in Sweden. Therefore the board is also adjusting its prediction for the repo rate’s path ahead. The change indicates the next adjustment will be during the second half of 2019 and not in the summer as previously predicted.
The board was not unanimous in its decision and Dagens Industri also reports that Thursday’s decision was somewhat unexpected. A survey by SME Direkt shows that only four of twelve analysts expected the Riksbank would raise the interest rate.
When asked by Svenska Dagbladet whether it would have been better to wait and see how the economy develops, governor of the Riksbank, Stefan Ingves, comments, “No, sooner or later you reach a point at which you have to put your foot down and decide. You can choose any decision time and always find arguments to wait two months.”
The economy is slowing and a new government will not be spending. “There is very little scope for unfunded reforms in a budget amendment,” says the National Institute of Economic Research's (NIER) head of forecasting Ylva Hedén Westerdahl.
In a new forecast, NIER concludes the economic boom culminated during the first half of this year. Falling housing investment has had a negative impact and the FSA predicts GDP growth of 1.3 per cent for 2019, which can be compared to 1.9 per cent in an earlier forecast. Unemployment has reached its lowest level.
NIER also predicts the Riksbank will wait to raise the repo rate until February 2019. Lower inflation and GDP growth than expected mean the central bank will not raise the rate today.
As of 1 January, internet giants such as Google, Apple and Facebook will have to pay a digital tax in France. Along with Germany, France has been keen to introduce a common tax within the EU.
The UK, Spain and Italy are other EU countries working on their own versions of a digital tax. Sweden, along with Ireland, Finland and Denmark, is opposed to a common EU digital tax.
Sweden’s Finance Minister Magdalena Andersson (S), has said that it is an issue of principle – that digital taxes break the constitutional tax principle that goods and services should be taxed where they are created, not where they are consumed
Sweden has climbed to third place in the World Economic Forum’s (WEF) latest equality ranking.
The global gender gap had long been shrinking, but last year, suddenly grew. It has shrunk again this year but with marginal movement. Author of the report Roberto Crotti, says that development has stagnated and at the rate it is going now, it will take 108 years until there is an overall gender balance in the world.
Sweden has climbed from fifth place last year and Iceland and Norway top the list. Sweden has never had a female prime minister, which both other countries have.
ABB is close to closing a deal to sell 80 per cent of its Power Grids division to the Japanese conglomerate Hitachi. The parties are expected to make the deal public today, according to Bloomberg sources.
According to earlier reports in the Japanese newspaper Nikkei, the business area will be hived off into a separate company. Hitachi initially will buy 50 per cent with the intention of eventually taking over the whole company.
Sweden's housing shortage is so acute that social housing needs to be built, according to Anders Sjelvgren, director general of the National Board of Housing, Planning & Building (Boverket), following the publication of figures which show a sharp drop in the number of housing starts.
Projections indicate the number of housing starts will fall to 48,000 in 2019, from a peak of 63,750 in 2017. Boverket has previously estimated that some 80,000 new homes need to be built in Sweden annually, which is why Sjelvgren believes the shortage will escalate.
With many unable to afford new homes, the shortage will require new solutions to counter segregation, argues the director general.
By a broad majority, the European Parliament has approved JEFTA, the free trade agreement between the EU and Japan.
Moderate MEP Christofer Fjellner said after the vote that the deal “means more to Sweden than many understand” and it will open up markets in the forest, food and engineering industries in particular.
The agreement will remove 97 per cent of duties.
EU Trade Commissioner Cecilia Malmström commented that the world’s largest free trade agreement has been created, covering 635 million people and one-third of the world’s economy.
Parliament is likely to adopt a budget motion put forward by the Moderate and Christian Democratic parties later today, which includes a proposal to cut appropriations to the labour market by SEK 2.9 billion in 2019.
In an internal report, the Swedish Public Employment Service (Arbetsförmedlingen) has warned employees that such a move will lead to a rise in long-term unemployment and a decline in job matching efficiency. Additionally, the cutbacks may force the agency to axe 1,700 jobs.
Following Centre leader Annie Lööf’s announcement that her party could not support Stefan Löfven, it is likely that the Riksdag will adopt a budget motion put forward by the Moderate and the Christian Democratic parties that includes tax cuts of some SEK 20 billion on Wednesday.
Professor Lars Jonung of Lund University, who has nothing against tax cuts in general since they promote job creation and education, says politicians should exercise caution given the impending risk of a recession. “We have an overly expansive monetary and fiscal policy,” he comments.
SEB head economist Robert Bergqvist holds with the professor, indicating that it might be preferable to wait and see if the economy is slowing down before introducing the cuts.
Meanwhile, Ylva Hedén Westerdahl of the National Institute of Economic Research says the government agency will be writing down its forecast for the Swedish economy next week. She is of the view that the centre-left government should have saved more for an economic downturn.
We are a small, but qualified team of graduates in politics, economics, English and classics dedicated to providing quality news digests in English that offer readers a first-hand look at the most important topics covered by the Swedish press. Here you will find a selection of the articles that are published in our Swedish Press Review.