Mundus Brief January 2022

After a tumultuous year globally, and in Sweden, December presented an opportunity to catch one’s breath.  As Magdalena Andersson presented her new cabinet, the political drama of November began to fade. There were a number of new faces, given the opportunity presented by the Greens leaving the government. Despite some early hiccups, the new team is up and running. The minister with the hardest start was Khashayar Farmanbar (S), who had to deal with the spike in energy prices, as opposition parties tried to pin the blame on the Government for Swedes electricity bills. Farmanbar survived that, and in the process got around to making a long-delayed decision about a repository for Swedish nuclear waste. And further policy was announced in January, with the Government saying that it was to compensate homeowners around SEK 6 billion to help ease the price shock.

Other news highlights from December included Foreign Minister, Ann Linde (S), who hosted the OSCE Ministerial Meeting at Arlanda airport on December 2-3. In the MPR we “Reviewed the Swedish 2021 Chairpersonship of the OSCE”. Sweden’s ‘back to basics’ programme sought to be ambitious with a focus on conflict resolution and peacebuilding, promoting Swedish foreign policy goals, including democratisation, gender equality, peace and security. 

On a negative note for Sweden, Saab’s Gripen lost out on tender for the Finnish airforce, with Lockheed Martin’s F35 winning the multi-billion order. It was Finland’s biggest ever arms deal, opening defence import opportunities and bringing Finland closer to NATO, as we discussed in last month’s Finland Monthly Brief. And in Mundus News we reported blow by blow on the EU’s minimum wage debate – a proposal Sweden finally caved on.

As is traditional for the January edition of the Monthly Policy Review, we also pick up on the review of the past year for politics and the economy. There was plenty of news for both, particularly on the political side. A very brief recap of Swedish politics in 2021 reminds us just how far things have moved. The year began with the Liberals suggesting that they would leave the January Agreement, a suggestion that very quickly became reality, and started the process towards political instability. As contentious legislation piled up, especially the law on Employment Protection Act (LAS) and the removal of rent controls for some new buildings, the Left Party (V) at first threatened and then went ahead with withdrawing its support for the Löfven Government. Löfven eventually stepped down as leader of the Social Democrats, paving the way for further instability in November, and Andersson’s eventual election as Sweden’s first female Prime Minister. It was a frenetic year, setting the stage for yet more drama as Sweden heads to the polls in 2022. The pivotal question will be – will the Swedish electorate cast its vote clearly, or will it be a replay of the past two elections, with fragmented opinion leading to weak minority governments. Sadly, that is our bet. But we will be covering all the action in Mundus News and the Monthly Policy Review helping you to follow and interpret events.

Swedish elections

Fortunately the economy has provided less of a spectacle, as 2021 saw a big rebound from the 2020 pandemic hit. According to the latest flash GDP estimate, in November 2021 the economy was over 5% bigger than 12-months earlier. Globally, the rise of inflation is causing waves, especially in the US. But in Sweden, the Riksbank and other economic observers are relatively more relaxed. Recently published CPIF inflation numbers show prices are up 4.1% y/y in December, a further increase from 3.6% in November. But, in comparison with the US headline number of 7%, the size of Sweden’s problem is easier to manage, and the cost of energy, which will fall back as winter eases, was the biggest contributor. In fact, excluding energy inflation was just 1.7% in December down from 1.9% in November. Nordea still forecasts that the Riksbank will leave the repo rate unchanged this year. Follow this and other business- and economic news in Mundus Business Insights, published on Mondays.

Our final MPR article looks at what seems initially to be an esoteric point, under the headline “Is legal certainty in Sweden under threat?” But the reason for the debate turns out to be far more tangible, with gun violence soaring due to the increased power and presence of criminal gangs in vulnerable areas. A report from the Swedish National Council for Crime Prevention (BRÅ) shows that Sweden has gone from having one of Europe’s lowest gun violence rates to one of the highest in less than ten years. And with that, most political parties have taken a more authoritarian turn in their crime-fighting policies. Now, the Moderate-led conservative opposition is advocating for policies inspired by Scandinavian neighbours Norway and Denmark. One of the most debated proposals is that Sweden should allow witnesses to testify anonymously in order that they have less to fear from reprisals, a vivid threat given gangland executions. However, opponents point out the flaws of such a system, which may deprive the accused of being able to defend themselves properly.

With 2021 put to rest our attention turns to 2022. Longer-term our focus will be on the September elections, which one hopes will give Sweden a stronger government. We are further increasing our resources to cover the contest which will be closely fought, and you can follow our overview here in the Monthly Brief, in the daily Mundus News and our analysis in the Monthly Policy Review. But, in the short-term the analysis is on an even more urgent situation – security. The February Monthly Policy Review will cover both the Folk och Försvar (People and Defence) conference and the annual Government EU Declaration and subsequent debate in the Riksdag. With Poland’s government saying this week that Europe faces the gravest risk of war in the last 30 years, much is at stake.

Behind the scenes at Mundus

Our customers see the results of our daily work, publishing reliable daily news and a variety of reports, including our own monthly research. But behind the scenes there is an equal amount of work ongoing to build our benchstrength and develop new products. Here’s a small window into what we are working on. For a professional service firm like Mundus, this starts with a talented team. This year we have two new starters: Fredrik Schiller, a former Swedish Ambassador who has worked at the OSCE, in the Balkans and in Africa and Karin Gjellan, a master’s student in International Relations at Stockholm University who has worked at UNHCR. Nick Davenport, who started with us in the autumn will take a lead on sales and commercial development. In January, Charlotte Perlaky from the Swedish Defence Academy starts an internship.

The bigger team supports our bigger aspirations, as Mundus looks to continue to develop services we believe define the cutting edge of the industries that we work with. Despite the challenges and tensions between nations, there is an ever greater need for economic, policy and business cooperation. This is felt most acutely when it comes to the pandemic and climate action.

Artificial Intelligence

As part of our remit to stay on top of emerging technology and our ongoing use of big data analytics, Mundus has developed a partnership with The Decision Platform (TDP), an innovative tech company based in Palo Alto California. TDP provides services to Fortune2000 companies and collaborates with Stanford University on academic programs. Put simply, TDP’s technology aids effective decision-making and gives insights into data that purely human analysis would miss, or at least take an age to uncover. TDP’s AI and ML, that is Artificial Intelligence and Machine Learning, approaches to extracting meaning from large and previously siloed data sources. In particular, TDPs database focuses on science and innovation, with datapoints including 40 million global research papers, 40 million global patents and 2 million global startups. Government’s can use the technology to peer a decade into the future, helping to create more robust policies and plans that help their country leapfrog development. Companies can use it to help drive innovation from lab-to-market or to identify promising start-ups in their technology niche for global partnerships. We are proud of our capacity to use cutting edge technology to deliver fresh insight and, as such, we plan over the coming months to incorporate some of TDP’s analysis into both our reporting, and translating that insight into action on behalf of Nordic companies looking to export their innovation overseas. As many of you will know, Artificial Intelligence is poised to have a huge impact on all corners of business and society as a whole. We hope by embracing the technology in our business we can strengthen our offering and the analysis we offer to our customers.

Green consulting offer

We will be supporting the AI-as-a-service offering with a green consulting offer, blending the tailored reports that Mundus already offers with our strong in-house capabilities in global carbon and cleantech markets, and our can-do business development experience. With so much to be achieved to make our world safer from the twin challenges of the pandemic and climate change, we are excited to get started. If you are thinking about how your country or company can achieve more with less resources, we are just an email away.