The Mundus Brief: January 2018

The Mundus Brief: January 2018
The Mundus Brief is our summary of the important Swedish news stories over the past month

The main stories in January

Trying to select January's most important stories is a challenge. Events like EU budget negotiations and major problems at the New Karolinska Hospital are important, but can’t be compared in terms of their long-term impact on Swedish society, relative to the issues of crime and the fundamental arguments over Sweden’s defence policy.

That said, we are leading this month with the stories that you won’t be reading in the news. Because they are simply not there. These are the stories about the world beyond the Nordics, the US and Brexit that have disappeared from view, pushed off the agenda by a lack of foreign reporters and tweets by Donald Trump. In our feature article in the January edition of the Monthly Policy Review, we explore how it has happened that coverage of the USA is three times that of India and China combined, with most other countries coming a distant third, fourth or fifth. For those of you fighting to ensure international issues remain relevant and understood by Swedes, we also have recommendations on how to make foreign events more relevant to Swedish journalists.

Swedish newspaper editors are not short of crime, safety and security stories to publish. In January alone Mundus News covered stories about increases in burglaries by foreign gangs, the increase in public gangland executions through shooting, bombs and increases in economic crimes. According to statistics from the National Council for Crime Prevention (Brå), close to 1.51 million crimes were reported in Sweden during 2017, which is approximately 4,000 more than in 2016. Aftonbladet mapped gang shootings over the last seven years in Malmö, Gothenburg and Stockholm and concluded that in that time there were nearly 1,500 shootings, 520 shooting related injuries and 131 people who have lost their lives. A Detective Superintendent at the Stockholm Police said, “These are awful numbers. I hadn’t thought we would see this development if you had asked me ten years ago”. Unsurprisingly, the first party leader of the year focused on organised crime.

Meanwhile, the Swedish police were widely reported to be unhappy and demotivated following a 2015 reorganisation of the force. The police were not even able to throw numbers at the criminals, with the density (numbers) of Swedish police at decade lows. Eventually the political pressure became too much, costing the Police Commissioner his job. The widely-respected head of Sweden’s security police (SÄPO), was brought in as a replacement. Despite the atrocious increase in violent crimes, the underlying trends are not all bad for the police. Road deaths and deaths from hard drugs are both down significantly.

Still on crime, the Dane indicated for murdering Swedish journalist, Kim Wall, in a submarine was indicted, and Rakhmat Akilov, accused of terrorism and the Drottninggatan attack last year began his trial.

Swedish elections

Security and defence also retained a high-profile in the news and in national politics. Defence policy looms as one of the highest priority elections issues, as the Alliance parties have finally overcome their policy differences and united around the policy of joining NATO. Given that 7 of the 8 Riksdag parties have agreed that a military attack (by Russia) can not be ruled out, the Social Democrats are searching for a convincing defence policy that does not include NATO. Further political problems for the Social Democrats arose through an apparent disagreement between the Defence and Foreign Ministers at the annual Folk och Försvar Conference. Defence Minister Hultqvist took a stand against Sweden signing a UN anti-nuclear resolution that jeopardises Sweden’s defensive ties to key allies such as the UK, France and the USA, while Foreign Minister Wallström warned NATO not to interfere in Swedish politics. At the Folk och Försvar conference Hultqvist underlined the point that Sweden had gone too far in reducing defence expenditures, a policy which needed to be reversed given current threat levels. In our latest edition of the Monthly Policy Review, we report on the policy debate.

The NATO policy flare-up was not the only defence issue of the month. The MSB, Sweden’s Civil Contingencies Agency advised that it was preparing to send all Swedish households a brochure with details of how to prepare for war and terror attacks, in a story that was reported widely in international media. Sweden also reinstated a long-forgotten defensive arrangement with Norway, and SÄPO warned of fake news ahead of the forthcoming elections.

The New Karolinska Hospital was in the news for all the wrong reasons. Instead of being in a position to profile medical and scientific research successes the hospital stands accused of broad scale mismanagement and a waiting list almost 9,000 patients long. The wait was too long for two cancer patients, and conflicts of interest continue to dog the management team. Mundus investigates in the February edition of the Monthly Policy Review.

Meanwhile, immigration and integration issues continued to rumble along in the background and both the Social Democrats and the Moderates named integration one of the key issues for their respective election platforms. Speaking what was on the minds of many Swedes, Ulf Kristersson said integration “can be a total success or it can be a total failure”. The government is still trying to enforce deportations. For those that are allowed to stay, it is rolling out initiatives for social policies and increasing budget allocations for social integration.

But the government does little to make the country appear friendly to foreigners. The tax department wishes to create a new tax that levies expats unrealised profits, i.e. profits that they have made, on paper only. The idea was firmly criticised by the Stockholm Chamber of Commerce, whose head, Maria Rankka, is looking for exactly the opposite sort of policies, arguing for lower taxes, a better functioning housing market and fast-track visas to attract talent to staff the hundreds of thousands of highly-qualified jobs that are expected to be created in the next decade. Meanwhile, in yet another public relations own goal, the Migration Agency is seeking to deport a Lebanese entrepreneur for cutting his own salary, when the company that he founded needed to resolve short-term cash needs. These are not trivial issues – we believe that the economic future of Sweden is at stake – that deserve to be elevated in the public debate. Is Sweden looking to back to the nostalgia of the 1960s – the social democratic heyday, or forward as a Nordic Singapore? We have spent several months researching expats' experience in Sweden, and will publish our in-depth report State of Expat Life in Sweden in February. Interested to know more? - contact Sean at Mundus International.

The business organisation, Svensk Näringsliv, was also in the news for the wrong reasons.  In November, its Chairman, Leif Östling resigned following a leak from the Paradise Papers, when he responded in a tone-deaf manner, saying “what do I get for my taxes”. In January, it CEO, Carola Lemna, criticised Stefan Löfven for overusing the mantra of the Swedish Model, and saying certain elements of the workplace model needed to be reviewed. Lemne was herself then attacked by the Minister for Employment and Integration, Ylva Johansson, describing her comments as “shockingly ignorant”. That punch landed, with the business community is reported to be hugely frustrated that its voice is not being heard effectively.

Another business organisation that will be glad to have January behind it is H&M, the international clothing brand, with its share price down 15% for the month (and 40% over the last year). Sales were down over the quarter, and the firm had to deal with a PR fiascoin South Africa. H&M announced that it was about to launch a new diversity and inclusion service.

Ericsson had yet another set of bad financial results, missing analysts expectations. However, Volvo Cars, Volvo Group (a truck maker) and SEB all reported positive results.

The housing market, which has suffered badly, with real estate agents blame the media for the housing price development. Falls of 8% were reported over a 3 month period in Stockholm and Swedbank predicts more is to follow. Nonetheless, real estate agents have described a more positive January, with foot traffic at viewings up as buyers look to get in before the new rules come into place of March 1.

And finally, Sweden remembers the life of Ingvar Kamprad, founder of IKEA, who passed away in January. His personally story epitomises the country of his birth, beginning "with two empty hands to become one of the richest people in the world".

 

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Sean is responsible for Mundus’ strategy and commercial activities. He began his career in the oil industry Australia. After working internationally in commercial roles with BP in South Africa, the UK and Singapore he moved to Sweden with his family in 2009. He worked in business development and then as the Strategy and Growth Director for NASDAQ Commodities from 2009 to 2015. Sean holds an engineering degree from Adelaide University and an MBA from the Darden Business School at the University of Virginia.