Economic trends
Sweden has one of the highest standards of living in the world. The country, which depends heavily on international trade, has a very developed industrial sector. After a rise in 2007, the growth of the Swedish economy collapsed in 2008, mainly because of slower growth in exports due to the deterioration of the international economic environment. In 2009, domestic demand continued to fall end the country entered into recession.
The Swedish economy is currently undergoing a more pronounced shrinkage than during the national banking crisis at the beginning of the 90s. Production dropped sharply in 2009, while unemployment has today become the Swedish curse, with one of the highest rates in Europe.
The GDP drop will entail a considerable production gap, so that the underlaying inflation will diminish even as growth picks up again. The monetary policy was eased but no new measures can be expected to reduce the market rates. The automatic and discretionary budgetary reactions will maintain demand and additional measures could contibute in keeping the raise of unemployment in check.
Main branches of industry
Agriculture represents less of 2% of the GDP. The main agricultural products are cereals, dairy products, meat, wood and potatoes. The country has a wealth of natural resources: forests, iron, lead, copper, zinc and hydroelectric energy.
The industrial sector contributes to nearly a third of the GDP. It is characterized by groups such as Volvo, Saab, Ericsson, ABB, AstraZeneca, Electrolux, Ikea, H&M, etc. Sweden's main manufacturing activities are processing wood, paper, electronic equipment, industrial food processing, pharmaceutical products, etc. The new technologies and biotechnologies sectors are of significant importance in the economy.
The tertiary sector contributes more than two-thirds of the GDP, and is maintained by telecommunications and IT equipment.
International trade
Sweden is very open to foreign trade. According to official Swedish statistics, the progression of trade in goods and services remains strong in Sweden, even though it slowed down considerably in 2008, and is likely to follow this trend in 2009. The EU is reinforcing its position as primary partner. In general, half the exports are destined for the EU and the most of imports come from there. Trade with neighboring Northern Baltic countries and Russia has increased rapidly. Exports to China and India show a substantial drop. Trade in motor vehicles and metals is very dynamic. The government supports Swedish companies' activity in strategic markets. The Swedish trade balance is expected to remain in surplus, even if it has been affected by the fall in international trade caused by the effects of the financial crisis.
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