After the interest rate crisis, there will be rapid economic growth, the fruits of which seem to be the first to be picked – Sweden, writes editor-in-chief Timo Paunonen.
I wrote in July 2020 from the corona-ravaged Swedish economy.
The western neighbor really didn’t go well.
Read more: Sweden driving its cold-blooded corona strategy at full wall – these figures reveal it
Industrial production plummeted, unemployment hit a record high, the number of bankruptcies jumped to the skies and GDP growth was strongly negative.
Sweden sought herd protection, ie did not set out to close and isolate society. The western neighbor wanted to keep the wheels of his economy spinning. Cafés, shops and restaurants with terraces work as before.
The strategy knew the infections and the victims, but once the virus went, the economy would be in immediate shape, Sweden reasoned.
Terraces and restaurants fluttered people in the spring and summer, but the economy stagnated in a way unprecedented in Sweden. In addition, the coronavirus became a scythe man who mowed elderly citizens like hay. When infections and deaths were relative to population, Sweden was at the forefront of questionable world crown destruction for even a moment in the summer.
State epidemiologist Anders Tegnellin the grinding corona strategy still doesn’t look good, at least not if you look at the victim numbers.
Thursday (February 25) from Sweden was toldthat there are a total of 12,798 deaths from the corona and new infections were registered in nearly 5,000 days. A new problem is access to vaccines: Sweden lags far behind neighboring countries. Sweden has also had to tighten its grip on virus control.
But what happened to the economy that Sweden wanted to keep going.
About the scary despite the interest rate figures, Sweden is making the coveted V-curve in its economy: a sharp drop, a sharp rise. A year ago, in the spring, everything collapsed, but in the autumn and at the end of the year, economic figures turned sharply upwards, especially when comparing industrial production and gross domestic product (GDP).
Swedish industrial production fell sharply in the spring of 2020.
However, it was not about a different approach to dealing with the interest rate crisis, but about the downtime in the car industry, which is important to Sweden: global demand stalled.
Now industrial production has returned to a near-crown peak. The unemployment rate also hurt by more than nine percent, a figure that had not been seen in Rust for ten years. Unemployment is also easing.
Chairman Pekka Ala-Pietilän published by an expert group led by statement Finland’s economic growth on Wednesday. In order to maintain the Nordic welfare state, the goal should be to double GDP growth to around 2% over the whole decade. In addition, the employment rate should rise to at least 76%.
But not for Sweden.
According to Eurostat’s forecast, Sweden’s GDP growth rate will already be 4% in 2023.
Three points in the Swedish-Finnish economic competition:
The contraction of both countries’ economies in the spring of 2020 remained rather mild in a broader European comparison. The decline in Finland’s GDP was the smallest in Europe, and the corresponding figure in Sweden was well below average.
The downturn in the Swedish economy was stronger in the spring of 2020, but now the Swedish economy is recovering stronger.
Finland’s growth threatens to remain more modest after Sweden than in Sweden due to, among other things, Finland’s unfavorable demographic structure.
Fight against the crown, there is a constant balance between health and the economy.
When it closes and restricts, business suffers in some areas, but not all. In the service sector, restaurants and tourism are taking the biggest shocks.
Where does the line run, making choices between fighting the epidemic and the economy. Due to the massive support system and government borrowing, this debate has not had to take place, nor will it take place if vaccines come at the promised pace and societal restrictions can be dismantled.
But the emphasis is still on the word if.
This is also interesting.
In the battle between the economy and the corona, the suppressors of the virus, New Zealand and China, and Sweden, which allowed the virus to spread freely, seem to be doing well. As global demand recovers, export-driven Sweden will immediately grab its own slice, thanks in part to its own currency, the krona.
News AstraZeneca vaccine delivery difficulties to pass on Finnish vaccine coverage and herd protection. It may also know that the debate on the relationship between the economy and health and on restrictions will continue for a long time – in the worst case, until next year.
After the financial crisis, Finland remained in the ranks of economic growth.
Hopefully this will not happen after the coronary crisis.
Source site www.is.fi