Exports are the engine that drives Sweden’s economy

Published 20 January 2020 in:

Photo: Niclas Vestefjell/imagebank.sweden.se

More people than ever are currently employed by Swedish export companies. Exports are the engine that drives Sweden’s economy and keeps around 1.5 million people in employment. But the world is changing rapidly and the Government has therefore produced a new and updated export and investment strategy. The objective: to create jobs and growth throughout the country.

The world has changed since Sweden’s previous export strategy was launched four years ago. Threats to free trade have intensified, and the competition for major procurements and investments has increased.

At the same time, the previously weak development of exports in Sweden has been reversed. In the last two years, exports from all Swedish regions have increased, and more people than ever work for exporting companies. The export strategy has produced results and been bolstered by the strong global economy and the development of the Swedish krona.

The new and refined export strategy now expands upon this, but also responds to the new situation around the world.

“I am proud of our strategy, that so clearly involves the regions in ensuring that all of Sweden exports more. When we trade with the rest of the world, jobs and growth are created that strengthen welfare throughout the country,” says Minister for Foreign Trade and Nordic Affairs Anna Hallberg.

The 2030 Agenda’s Sustainable Development Goals and the Paris Agreement have, for example, created new opportunities for Swedish companies to contribute to climate transition. To address these challenges and opportunities, the export strategy has been updated with an enhanced focus on sustainability and regional growth. Swedish companies are already at the forefront, but major investments are now needed to match the major business opportunities that follow from the climate transition.

One example is that Sweden’s almost entirely fossil-free electricity production allows the production of products with a lower carbon footprint than in competitor countries with a more fossil-based energy mix. In addition, the Swedish business sector also exports many products and services that themselves contribute to reduced emissions and so benefit the environment.

Sweden will also drive the issue of sustainable procurement. The potential is great – worldwide procurements correspond to 10–15 per cent of the world’s GDP. Accordingly, sustainable procurement provides real leverage for increased economic, social and environmental sustainability around the world.

The export strategy has five strategic goals:

  • Increase Sweden’s exports, both in absolute figures and as a proportion of GDP. Example: Some 70 per cent of Sweden’s exports go to the EU single market, but the major opportunities of the future are in the growth markets, primarily in Asia. To increase exports, it is therefore important that Swedish companies also export more to markets outside Europe.

 

  • Ensure that more small and medium-sized enterprises export. Example: There is great growth potential among the small and medium-sized enterprises. These enterprises are often at the forefront when it comes to innovation and producing technical solutions that are necessary to achieve the Sustainable Development Goals. They are often part of a value chain or a system solution. Opportunities for small and medium-sized enterprises to grow and export must therefore be further strengthened. To meet the enterprises’ concrete need of support and potential for internationalisation, regional export cooperation is also an important tool and will be further developed.

 

  • Ensure that Sweden is a driving force for free, sustainable and equitable international trade. One example is the EU single market. Studies show that there is potential for considerable efficiency gains, corresponding to EUR 600 million, if the rules of the single market are upheld and better implemented in practice. In WTO negotiations, Sweden will also push to remove tariffs and trade barriers in general – and then naturally also for climate-friendly goods, services and technologies, so that these can help step up the pace of climate transition.

 

  • Use Sweden’s innovation leadership to enhance the export capabilities and international competitiveness of Swedish business. Example: To strengthen and develop strategic international innovation cooperation in important markets, Sweden has entered into innovation partnerships with strategically important countries such as France, India and Germany. A strategic partnership with Brazil is already in place. The Government has also opened innovation and research offices at the embassies in Brazil, India, Japan, China, South Korea and the US. Activities at the offices are intended to strengthen Sweden as an attractive, leading knowledge and innovation nation.

 

  • Increase Sweden’s attractiveness to foreign investors, skills, talent and visitors. Example: Half of Sweden’s exports come from foreign-owned companies that have invested in Sweden, and almost half of the private investments in research and development are made by foreign-owned companies. Sweden’s attractiveness for advanced production and innovative methods increases with growing digitalisation, regionalisation of global value chains and increasing customer demand for sustainability. There is great potential in further promoting the expansion of high-quality activities already found in Sweden, particularly of strategically important companies in rural and sparsely populated areas.