The Riksdag set the framework for Sweden's state budget 2012 on 23 November. This first decision concerning the Budget Bill means that the Riksdag has adopted the Government's proposal for the direction of fiscal policy, estimated central government revenues and financial frameworks for the 27 expenditure areas.
The Riksdag considers the Government's budget proposal in two stages. In the first stage, the Riksdag takes a decision on the framework for the state budget and, in connection with this, an economic policy debate is held in the Riksdag. The next stage involves the Riksdag taking a decision on how expenditures are to be distributed in each individual expenditure area. This work continues until the end of December. The Budget Bill is finalised when the Riksdag has taken decisions on all 27 expenditure areas. The preliminary date for this is 20 December.
Financial Times has ranked Anders Borg as the best EU-finance minister 2011. The ranking is based on political ability, economic performance and credibility in the markets. Anders Borg gets the highest rank in all of the categories. In connection Financial Times has interviewed Anders Borg on the economic situation in Europe.
The Government has decided the guidelines for central government debt management. In these guidelines, the Government puts increased focus on robustness and the refinancing risk in debt management. Borrowing in long maturities will therefore increase. In the coming years the central government debt is expected to decline from about SEK 1 100 billion to about SEK 850 billion in 2015, but there is considerable uncertainty.
Every day on TV and in the papers we can see new reports about the debt crisis. Greece has serious problems, but so do other EU countries. Sweden is standing strong in these turbulent times, but there are undoubtedly a lot of people who are concerned about developments nonetheless. In this newsletter you can read more about the Government's view on these matters.
In a joint opinion piece published in the Financial Times on Wednesday, Minister for Foreign Affairs Carl Bildt and Minister for Finance Anders Borg write about the role of the banks, and state that a coordinated European approach is necessary to achieve financial stability.
"The European banking sector is under extreme stress. As fears grow about the sustainability of Greek public finances, banks with large exposures to Greek bonds are under increasing pressure. The situation is not beyond recourse, however. Through coordinated European and national policies, progress can and will be made."
The debt crisis and the situation in North Africa and the Horn of Africa will be in focus when Minister for Finance Anders Borg and Minister for International Development Cooperation Gunilla Carlsson take part in the World Bank and IMF annual meetings on 23-25 September in Washington.
With this year's budget, the Government is taking responsibility for Sweden in turbulent times. To offset the effects of the crisis, improve long-term job and growth prospects and strengthen welfare, the Government is proposing measures totalling SEK 15 billion in 2012 and SEK 17.3 billion in 2013. At the same time there are safety margins in the public finances to ensure that Sweden can manage even worse developments if the debt crisis is deep and protracted with considerable impact on the Swedish economy.
Minister for Finance Anders Borg answers questions on developments in the financial markets, the impact on Sweden and the Government's response.
Resolute action to address investor perceptions of sustained weakness in the EU banking sector is an important part of the comprehensive response to the crisis, as endorsed by the European Council. In this context, the objective of the EU-wide stress test carried out across 91 banks for the period 2011-2012 is to assess the resilience of the EU banking system to adverse shocks.
On Friday, the Government submitted Sweden's convergence programme and Sweden's national reform programme for 2011 to the European Commission. The convergence programme is based on the 2011 Spring Fiscal Policy Bill. Starting this year, country programmes are submitted in April so as to strengthen the link to the national budget processes. The reform programme is part of the annual follow-up conducted by all EU Member States to present the policy they intend to pursue to live up to the targets and guidelines of the common EU growth strategy - Europe 2020.