Sweden Warns of Economic Impact from Trump's Tariffs, Eyes Short-Term Work

The government warns of enormous consequences of Trump's tariffs and growth will have to be written down. This is harmful to the Swedish economy, says Finance Minister Elisabeth Svantesson (The Moderate Party). One measure to support companies may be short-term work – similar to what existed during the pandemic.

» Published: Thu 10 Apr 2025 10:43 CEST

The Prime Minister Ulf Kristersson (M) and Finance Minister Elisabeth Svantesson met with about 20 representatives from the labor market and industry on Thursday.

What has happened in recent weeks and days is incredibly harmful to the Swedish economy, for Swedish companies, for Swedish jobs if this escalates and continues, says Svantesson.

She mentions that many small savers and investors can feel anxious when the stock market fluctuates, even though the Stockholm stock exchange has risen on Thursday.

Many Swedes have been affected in recent days and weeks. We should have ice in our stomachs when we move forward, but many of them probably feel a lump in their stomach.

Opens up for short-time work

The risk if the turbulence continues is that investments will disappear from Sweden and in the next forecast, growth will "certainly" need to be written down. The Prime Minister describes that the government has tools to take action if the situation worsens further.

If this still hits Sweden directly, or via Germany, then Sweden has muscles in the form of stable public finances and systems for short-time work, which means we can support companies, says Kristersson.

Donald Trump's unpredictability and tariff decisions will affect the relationship with the US for a long time, continues Svantesson.

It's confidence-damaging and it will be for quite some time. And it didn't have to be this way, that's the sad thing.

Then you should know that the Swedish economy and politics stand firmly.

Kristersson: Lower the tone

Sweden as an export-dependent nation can be severely affected if the trade war shifts into a new gear. Now Trump has announced a three-month tariff pause, but the uncertainty remains.

It gets very negative consequences if we enter what is often described as a trade war. What is now happening between the US and China can already be described as a trade war. It's a very uncertain time, says Ulf Kristersson.

It's good if we lower the tone.

He doesn't want to say what he thinks about Donald Trump.

My emotional life, that's not where I am when I'm dealing with politics.

Minister for Development Cooperation and Trade Benjamin Dousa (M) raises that China may come to export more to Europe now, which can mean a risk of dumping.