Mundus Brief: September 2021

It could read like an introduction to a Dickens novel. “It was the best of times, it was the worst of times … it was the season of Darkness, it was the spring of hope, it was the winter of despair” … So it is today in Sweden.
On September 29, the country will emerge officially from the pandemic, a year and a half of suffering, sadness and struggle. It has been hard, and indeed tragic for some. But then again, there is still a feeling that for many, even the majority, the pandemic has been more livable in Sweden than elsewhere. And now, with the worst several months behind, industry roaring, and in the dying embers of summer, it feels good to be here.
But then, take a pause and reflect on the world. Perhaps it is not all that rosy. Crime, even violent crime, is on the front pages on a near daily basis. In August alone, 10 persons lost their lives by shooting, and another 13 were shot and injured. The first few days of September started similarly poorly. According to Stockholm’s Police Chief, the level of conflict between the gangs in Stockholm’s suburbs is especially high right now. “They are easily offended, they have poor impulse control, they are young and they are inexperienced. It can be small things like a minor debt that leads to shooting.”
Also during August a report was released by the Swedish National Council for Crime Prevention, Brå, which found a large correlation between immigrants and the tendency to commit crimes. At face value the study shows that people born in Sweden to foreign-born parents are three times as likely to commit a crime as a Swede. There is clearly a big problem. But the picture is not as simple as the far-right will try to point out, and the issue is sure to be a centerpiece of the next election campaign. Hence, what’s going wrong with integration will be the subject of in-depth analysis in the next edition of the Mundus Monthly Policy Review.
Externally, even worse events were in play last month. The fall of Afghanistan to the Taliban was not just a shock to Swedes, it has strategic implications, both in terms of Sweden’s immigration and integration policies and to the large investment that Sweden made in building democracy in Afghanistan. Not to mention the desire of a number of political parties to repatriate Afghanis who arrived in 2015 back to their homeland, lest they create further integration challenges. The events and implications of Sweden’s departure from Afghanistan are covered in the September edition of our Monthly Policy Review (MPR).

Monthly Policy Review

Our lead story in the MPR was the unexpected departure of Stefan Löfven from his position as PM. Löfven will step down at the party’s annual congress in November, and a process is now in train to choose his successor. While most political parties would see a clear competition between aspiring candidates, for Sweden’s Social Democrats it is a ritual that has been likened to choosing a new Pope. So far, no one has put their hand up for the job, whilst many have declared themselves out of the running. All this is slightly humorous, because by now it seems obvious that Magdalena Andersson will be elected leader of the Social Democrats. However, it’s not that obvious that she’ll make Prime Minister, as the Government needs to have a budget passed by the Riksdag at the same time as its expected that she will be elected. And if it doesn’t succeed in getting Andersson’s budget (that she’s currently designing as Finance Minister) through, then this could be the trigger for yet another government crisis. And, if she survives all of that, its even less likely that she will be reelected by the votes in twelve months’ time. All of this makes for a very eventful Political Autumn, which is our follow-up story in the MPR.
So caution should be used in predicting Sweden’s direction. Even if the country is doing well now, that doesn’t mean it will continue to. Fragile politics makes for a weak government when most analysts would like to see strong governments pushing through reforms to housing markets and climate action. Not to mention the need to change the direction of the gang wars that have painted Stockholm suburbia in the same hues of red as Prohibition Chicago.
But let’s push all of that out of our mind for the moment, and marvel once again Sweden’s economy. The latest round of forecasts by banks and other institutions promise growth of over 4% in 2021, with solid growth in subsequent years. Partly this is as a result of the stimulus that the government has put into the economy, leaning against the pandemic. Partly, it is driven by the pick-up in Sweden’s major trading partners. But it is also the result of a formidable industrial environment developed over decades. Our final MPR story, “Gunning it Down the Straight” picks up on the comments by economist Kjell A Nordström, who likened Sweden’s economy to a Ferrari, that had only been driven at 20 kilometres per hour. But with its world leading performance during the pandemic and with the superchargers currently on, the Ferrari has quickened its speed. And that was the analysis before new figures out this week, which indicated that Sweden’s GDP grew 0.5% in July alone, and the economy was 7.8% bigger than in July 2020. This was well above where even bullish economists had declared it to be just weeks earlier.
Where is this leading Sweden? The future is unknowable as the next chapter to be published in a Dickens novel. Events will continue to make themselves felt. Let’s hope they are not as dramatic as those of recent times.