Economic policy

The Government on instructed the Swedish Tax Agency and Tillväxtverket (the Swedish Agency for Economic and Regional Growth) to make preparations so that as of 1 April 2022, the Tax Agency can be the managing authority for Tillväxtverket’s currently responsibilities under the Act on aid in the event of short-time work.

Today, Minister for Finance Magdalena Andersson presents the Ministry of Finance’s latest economic forecast and the direction of the central government budget for next year. The Ministry of Finance forecasts growth of 4.4 per cent this year and 3.5 per cent next year.

Discussions on the situation in Russia and how the EU should manage it, along with LGBTIQ issues, dominated the EU summit on 24–25 June. Prime Minister Stefan Löfven and other EU leaders also addressed the COVID-19 situation and the economic recovery.

When the EU’s heads of state and government meet in Brussels on 24–25 June, they will discuss the economic situation in the EU, migration and a number of foreign policy issues. They will also look at activities related to COVID-19. Prime Minister Stefan Löfven and his colleagues will kick off the summit with a working lunch with UN Secretary-General Antonio Guterres.

The Swedish economy is recovering rapidly after the deep downturn last year. The Ministry of Finance’s latest forecast calls for GDP to grow by 4.7 per cent this year, which is 1.5 percentage points higher than in the forecast presented in connection with the Spring Budget in April. Public finances are also expected to be stronger than in the previous forecast.

In July 2020, EU heads of state and government agreed on a recovery package to mitigate the effects of the crisis. The package, called NextGenerationEU, comprises EUR 750 billion (2018 prices) in loans and grants to Member States. The main part of this will be channelled through the Recovery and Resilience Facility (RRF). On 28 May 2021, Sweden submitted its recovery plan to the EU.

The government parties, the Centre Party and the Liberal Party have agreed on supporting SAS to access liquidity equivalent to SEK 1.5 billion. This support from the Swedish State is subject to the European Commission’s approval of the measures and corresponding support from the Danish State.

The situation for the travel industry remains serious. Earlier in the pandemic, travellers sometimes accepted replacement holidays instead of a refund when package tours were cancelled due to the outbreak. Many of these replacement holidays are now also being cancelled. The Government is therefore working on a proposal that will give package tour operators the option of taking government loans to refund money to travellers. The proposal is based on an agreement between the government parties, the Centre Party and the Liberal Party.

The Stability and Growth Pact is a set of rules for coordinating fiscal policy between EU Member States. The purpose of these rules is to ensure sound public finances. Every April, Member States are to submit stability and convergence programmes. Sweden and other Member States that have not adopted the euro submit convergence programmes, whereas Member States that have adopted the euro submit stability programmes. The programmes are used by the Commission and the Council in their assessment of Member States’ fiscal policies and situations.