The current economic crisis has hit all European countries. Given my Swedish origins, I am asked about how Sweden is doing in this context. The response is... surprisingly well.
At the beginning of the 90s, Sweden experienced a similar downturn to the current Spanish one: financial collapse, end of housing boom, government budget deficit and general economic recession.
The way Sweden confronted the depression has become a reference as the Washington Post stressed in The Swedish Recovery. The lessons learnt explain why the swedes have overcome the current climate better than the rest of the European neighbors. Another good article on this is Why Sweden had a good crisis that highlights some success factors:
- Reacted promptly, efficiently and with wide support from the electorate
- Kept fiscal house in order when times were good, to have more room to maneuver when things turned around
- Benefited from the automatic fiscal stimulus and used monetary policy aggressively
- Kept the value of the Swedish Krone flexible
Nevertheless, unemployment remains a cause for concern in Sweden, as in most European countries. We face a tremendous common challenge that will need the best effort from our public authorities, private companies and human resources professionals.