Sweden Pledges 23 Billion Kronor for Economic Stimulus

By Hans Bengtsson
Hans Bengtsson
Hans Bengtsson
December 6, 2008 Updated: December 6, 2008

The Swedish government presented a stimulus package of nearly 23 billion Swedish kronor (2.7 billion US dollars) on Friday to counteract the growing recession and effects from the financial crisis.

The financial package consists of slightly more than eight billion Swedish kronor (1 billion US dollars) for 2009, almost the same amount for 2010, and about five billion kronor for 2011. Employment offices will receive three billion kronor in order to create jobs for up to 50,000 people.  The jobs will be created by finding better matches on the job market, giving more access to individual coaching, and creating trainee posts – measures that according to Swedish Prime Minister Fredrik Reinfeldt are in great demand from the employment agencies he has visited throughout the country.

At a press conference on Friday at the Rosenbad – the building in Sweden's capital Stockholm that houses the Swedish Cabinet Office and the government ministries, Prime Minister Reinfeldt, Minister of Industry Maud Olofsson, Minister of Education Jan Björklund, and Minister of Social Affairs Göran Hägglund announced future investments on vocational training and education for adults at the
upper secondary level and post-gymnasium level. However, no investments were planned at the university level. Other measures planned include the maintenance of roads and railways. Domestic housekeeping services will be allowed exemption from taxes.

The stimulus package will supplement another 32 billion kronor (3.8 billion US dollars) that was set aside from the “super budget” to counteract the effects of the global financial crisis. The new "super budget" was presented earlier this autumn and will take effect on January 1 of next year.

Even though car maker Volvo has been worst hit by the financial crisis so far, none of the current measures are directed at the ailing automobile industry. Volvo recently announced it would be cutting 6,000 jobs, two-thirds of them in Sweden. Ford Motors Company is said to be shopping Volvo and is asking for $6 billion, the price it paid when it first bought the Swedish car company in 1999.

According to Olofsson, the Swedish government is currently analyzing the overall situation of the automobile industry and will take measures when the analysis is finalized.

Hans Bengtsson
Hans Bengtsson