Sweden country brief

Introduction

The Kingdom of Sweden (Sweden) is the fifth largest country by area in Europe (449,964 square kilometres) with a population of 10 million (2017). The capital of Sweden is Stockholm. Sweden celebrates its National Day on 6 June.

Political overview

System of Government

Sweden is a constitutional monarchy and has a parliamentary system of Government. King Carl XVI Gustaf exercises only ceremonial functions as Head of State. Executive power rests with the Cabinet, which is responsible to the unicameral Parliament (Riksdag) comprising 349 members who are directly elected every four years on a proportional basis. Voting is not compulsory but turnout is usually over 80 per cent.

Political developments

Swedish general elections were held in September 2014. The outcome resulted in the three largest centre left-wing parties (the Social Democrats, Green Party and Left Party) gaining more seats than the centre-right Alliance for Sweden coalition, with the two blocs receiving 159 and 141 seats respectively. The non-aligned Sweden Democrats more than doubled their support to win 49 seats.

On 3 October 2014, Prime Minister Stefan Löfven, formed a minority government consisting of the Social Democrats and the Greens (with only 138 out of 349 seats). On 27 December 2014, the Social Democrats and the Greens made an agreement with the opposition Alliance parties which will allow the government's budgets to pass the Riksdag in return for concessions regarding immigration policy, defence and pensions. The next parliamentary elections are due to be held on or before 9 September 2018.

Sweden’s government is a self-declared feminist government, the first in the world, with a set gender equality goal and commitment to implement gender mainstreaming and gender-responsive budgeting. Equal employment and pay, representation and health are three specific focus areas for the government. The government has stepped up its efforts to mainstream gender into the Budget Bill for 2017. All policy proposals and reforms in next year’s Budget Bill would be based on a gender equality impact analysis and incorporate a gender-sensitive approach.

In 2015, 163,000 asylum seekers arrived in Sweden, the highest number per capita in Europe. Migration continues to be one of the major policy challenges of the incumbent government.

Foreign policy

Sweden's key areas of foreign policy focus are development assistance, conflict prevention, peacekeeping, the environment, refugees and trade policy.

Sweden has a feminist foreign policy that aims to strengthen women's rights, representation and access to resources. Sweden has a self-declared feminist foreign policy that aims to strengthen women's rights, representation and access to resources. In December 2015 Sweden released the Swedish Foreign Service action plan for feminist foreign policy 2015-2018. Sweden has declared that all national policies, budgets and international aid will contribute to gender equality.

An active commitment to the United Nations has been a corner stone of Sweden's foreign policy since it became a member in 1946. On 28 June 2016, Sweden was elected by a wide margin as a non-permanent member of the UN Security Council for the 2017–2018 term. In June 2017, Sweden co-hosted (with Fiji) the UN Oceans Conference in New York.

Sweden is a generous aid donor. In 2016, Sweden provided US$4.9 billion in net ODA, which represented 0.94 per cent of its gross national income (GNI). This was a 31 per cent decrease from 2015, mostly due to decreases in in-country refugee costs. Sweden is the third largest ODA donor in proportion to GNI.

Sweden joined the EU in 1995, following a referendum in which a narrow 52 per cent of electors voted in favour. However, in a referendum in September 2003 the Swedes rejected joining the Eurozone by 56 per cent.

Sweden has a long-held policy of non-participation in military alliances, although its security doctrine was revised to allow cooperation with other countries to ’secure regional and international peace and security.’ Sweden became a NATO Partner for Peace in 1994 and an Enhanced Opportunity Partner in 2014 (along with Australia, Finland, Georgia and Jordan). Sweden has deployed personnel in Afghanistan since 2001 through the International Security Assistance Force (ISAF) and Resolute Support Mission. Sweden’s military contribution to the Global Coalition to Counter Daesh is 35 military trainers in northern Iraq to train Iraqi defence forces. Every three years, it is the lead nation for the EU’s Nordic Battlegroup, a coalition of seven Nordic and Baltic nations whose mission is to be ready to contribute to the EU’s crisis management capability. Nordic-Baltic cooperation is an important aspect of Sweden's foreign policy. Along with Finland, it recently joined the UK-led Joint Expeditionary Force (JEF), tasked with tackling threats and responding to crises around the world, encompassing eight like-minded northern European partners.

Economic overview

The Swedish economy is heavily dependent on a highly developed and internationally successful industrial sector, which was established in the early part of the 20th century through companies such as Ericsson, ASEA/ABB, Astra, Alfa Laval, SKF, Electrolux, Volvo and SAAB, and now includes more recently established retail companies such as H&M and IKEA. However, many of the flagship companies are now totally or partially owned by foreign companies and shareholders. There have been several structural reforms since Sweden became a member of the EU, such as the deregulation of the telecommunications, energy and air traffic sectors.

Since economic slowdown in 2012, Sweden’s economy has recovered and remains solid, with real GDP growth of 3.3 percent per year in 2016, down from 4.1 per cent in 2015. Job creation has been steady in recent years, helping bring the unemployment rate down to 6.7 per cent in 2017. According to the IMF, growth of about 2.7 per cent is expected to continue into 2017.

Bilateral relationship

The bilateral relationship between Australia and Sweden is strong, particularly in the areas of trade and education services. The bilateral relationship is underpinned by a Double Taxation Agreement (1981) and a Working Holiday Maker Arrangement (in effect since 2001).

The 2016 census recorded 40,216 people in Australia of Swedish ancestry. Around 1,500 Swedish students study in Australia each year, and Australian students are also studying in Sweden. In the year ended March 2017, 45,000 Swedish visitors arrived in Australia, while 17,700 Australian residents departed on visits to Sweden.

Australia has an Embassy in Stockholm. Sweden has an Embassy in Canberra as well as a Consulate-General in Sydney and Consulates in Adelaide, Brisbane, Cairns, Darwin, Hobart, Melbourne and Perth.

Recent visits

Recent incoming high-level visits include the Minister for Health Care, Public Health and Sport, Gabriel Wikström, in October 2015, and the Minister for Employment, Ylva Johansson, in January 2016. Sweden's Minister for Foreign Affairs, Mr Carl Bildt, visited Australia in March 2013. Sweden's State Secretary for Trade, Mr Gunnar Oom, visited Australia in March 2012 with a concurrent visit by the Swedish Parliament's Committee on the Constitution.

The Australian Parliament’s Joint Standing Committee on Migration visited Sweden in July 2017. In January 2017, Chief of the Defence Force, Air Chief Marshal Mark Binskin visited Stockholm for bilateral discussions with the Supreme Commander of the Swedish Armed Forces, General Micael Bydén. In February 2013, then-Minister for Defence, Mr Stephen Smith, and Chief of the Defence Force, General David Hurley, visited Stockholm for discussions with Sweden's Minister for Defence, Ms Karin Enström. Then-Minister for Foreign Affairs, Mr Kevin Rudd, visited Sweden in May 2011 for the UN High-level Panel on Global Sustainability, where he met with HM King Carl XVI Gustaf, Foreign Minister Carl Bildt and Mr Vidar Helgesen, then Secretary-General of the International Institute for Democracy and Electoral Assistance (IDEA).

Bilateral economic and trade relationship

In 2016, two-way merchandise trade between Australia and Sweden totalled $2.33 billion, overwhelmingly in Sweden's favour. Australian merchandise exports to Sweden totalled $279 million and included coal and alcoholic beverages. Imports from Sweden totalled $2 billion and included pharmaceutical products, medicaments vehicle parts and accessories, and motor vehicles. Two-way services trade in 2016 was $653 million. Australia's investment in Sweden was $9.3 billion in 2016, a 22 per cent increase on the previous year. Sweden's investment in Australia was $8.3 billion, also a 22 per cent increase on the previous year.

For information on doing business in Sweden, please see Austrade’s website.

Last updated August 2017.

Last Updated: 31 August 2017