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Political Economy

Swedish Finance Minister delays economic and budget forecast as uncertainty cloud his thoughts

Tuesday, 20 November 2012
Anders Borg defends his stance not to clarify the Government's approach to jobs and growth for next year. The bottom line is that global the economic situation has gotten "darker" and this will force the minister to review the states budget stance going forward.

The Swedish economy quickly darkened in the autumn and the government has been forced to delay its economic forecast. The outlook for exports has darkened because of the international economic slowdown, Finance Minister Anders Borg said on Tuesday. As such new figures will come out in December, not as stated earlier in January.

The minister acknowledge that Sweden is in a difficult situation with a slowdown for Sweden's industry which will likely persist but it is hard to predict how deep it will be and how long it will last.
Economic indication show that the Swedish economy is in a slow down with various sectors of the economy signally layoffs and export companies being hit very hard but the Finance minister feels that the slow down is not as severe as in 2008.

The government had stood alone in September and presented a budget proposal that said the Swedish economy would grow by 1.6percent this year and 2.7 percent next year. It also held that unemployment would continue to fall in 2013, compared to the much gloomier picture presented by both the Swedish central bank, the Riksbank and the State's National Institute for Economic Research (NIER). They had presented that growth would be just 0.9percent this year and 1.8percent in 2013.

Anders Borg is now admitting that as exports continue to decline and data from the industrial sectors continue to show a depressed mode, his economic indicators has to be degraded. But this is about a slowdown and not something to the likes of 2008 - 2009 financial crisis the minister insist. In this light, he will update the government's forecasts just before Christmas.
By Scancomark.com Team

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