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By Steve Kelman

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Why Sweden's economy is thriving

I left Boston for Stockholm on Friday night, ahead of the hurricane, to give a talk at a European conference on government procurement. Bizarrely, it has been quite windy in Stockholm, for reasons that I assume have nothing to do with Irene, but I've been surprised to see how many tourists are in the middle of the city so late in the summer, with European vacations having more or less come to an end. The Central Station, near my hotel, is being dug up for construction of a new underground commuter train line, and the signs outside show an irony and low-key sense of humor that is not typical of the Swedish, proclaiming the station "the messiest in the world" and presenting an excuse for the harried passenger: "Sorry I'm late — I got held up in the chaos of the Central Station."
 
(There was an unusual comment about tourism in an editorial in Sweden's leading daily Dagens Nyheter about the upcoming Danish elections. Noting the 25 percent increase in tourism to Sweden since 2000, compared with a 25 percent decline in Denmark, the editorial suggested this was due to Denmark's bad reputation as an anti-immigrant and racist country compared with Sweden. This seems implausible, but who knows?)
 
Those who think about the Swedish economy at all — probably not a huge group, especially when you subtract the people who believe they are thinking about the Swedish economy but are actually thinking about Switzerland — probably associate it with Volvo, niche engineering industries similar to Germany's, and perhaps Spotify, the Swedish file-sharing company.

It turns out that one of the reasons the Swedish economy is doing well —which it is — is a huge increase in exports of iron ore from the arctic north of Sweden to China. China’s also been importing iron ore from Australia and Brazil. I have learned an amazing thing about these exports on this trip. The center of the iron ore industry in Sweden is the city of Kiruna, right next to the old iron mine. It turns out they have found more iron ore under the city itself, and, in order to be able to exploit it, the entire city, with its 20,000 inhabitants, is being moved so that a new mine can be dug where the city used to be. This was actually democratically agreed to locally, though the main beneficiaries will be the children of current residents, not today’s Kirunans.
 
I also gave a talk at the Stockholm Harvard Club, and at dinner afterward the topic of China came up. It turns out that the Swedish media — I am guessing this is not so different from a number of other countries — has been presenting the story that, with the U.S. debt crisis, America is in decline and is close to being replaced by China. Apparently (and this did surprise me) the Swedish media say very little if anything about the problems of the Chinese economy, and, for example, the issues surrounding the recent high-speed rail accident, covered quite extensively in the U.S., were not mentioned in the Swedish media. One person told me that many Swedes saw the purchase of Swedish car maker Volvo by a Chinese company, after it had been owned by Ford, as symbolic of a passing of the power torch.
 
Finally, I heard about the new Swedish currency that is about to come into circulation. What is amazing is who will be pictured — no ancient heroes or old statesmen, but rather the actress Greta Garbo; the film director Ingmar Bergman; and Astrid Lindgren, the author of the Pippi Longstocking children's books.

I'm not sure if this is "very Swedish," but it's certainly very unusual.

Posted on Aug 30, 2011 at 12:09 PM


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Reader comments

Fri, Oct 14, 2011 Alex Stockholm

This article is so typical of someone from America that for the first time "explores" another country outside of their own ignorant bubble. So much stereotype in between the lines here. Cold country does not equal "dull" or "humorless" people. And while we are it I might take the opportunity to kill another myth about swedes that seems to go around inside american heads, we do NOT have the highest suicide rate in the world. We are somewhere in the middle alongside the US. DONT know where this comes form. Jealousy? Actually, Denmark are the happiest people in the world, tightly followed by their scandinavian neighbours including sweden. US is far down that list. We top most lists we it comes to a successfull society, US DOES NOT. Moreover, our succesfull economy is not because of our iron export to china? That ridiculous. It not a very big part of the economy. Our export lies mainly in high tech, IT and retail. Being a small (9 mill) "socialist" country, you d be surprised of how many multinational corporations we have, including Volvo, Saab, H&M, Ericsson, IKEA, electrolux and more. We are also inventors of new IT companies like Skype and Spotify. THIS is where our export lies!

Thu, Sep 1, 2011 Per Yardley, PA, USA

Why wouldn't irony and low key humor be typical of Swedes. Watch Swedish TV-commercials, most of them are funny, in a low-key ironic way. Stereotypes of people are always wrong. I find that Swedes and Americans have a lot in common, if you just choose Americans and Swedes that have a lot in common. You can also say the opposite, if you make a different choice of company.

Wed, Aug 31, 2011 qwert

Personally I think that the only ppl who believe that Nordic ppl are depressed/unlucky are themself. Denmark was the happiest country in Europe according to the latest study i read and before that Sweden was in top.

Wed, Aug 31, 2011

Perhaps Sweden is the proof of the observation that large social organizations (nations, religions, etc.) follow the development pattern of an individual: childhood, followed by stormy adolescence, and going into adulthood. As Vikings in the tenth century, they used to raid entire Europe from Ural to Sicily to England; even back in 17th century they attempted to conquer most of Central Europe. Now they are a calm, phlegmatic, competent bunch with a slight drinking problem.

If that theory is true, one might argue that US is in the early twenties, getting ready to settle down and get busy fixing the farm.

Wed, Aug 31, 2011 Anna-Karin Hallberg Sweden

Yes, Greta Garbo, Pippi Longstocking, Astrid Lindgren and Ingmar Bergman are people we are very proud of as Swedes. Just like to point out though that so many of us are not like the characters in the Bergman movies... ;-). Many Americans ar...e surprised when I say I'm Swedish... They think we all are quiet, shy and depressed... But the Bergman movies reflect very much Bergman's own inner demons. I grew up with Woody Allen and Harpo Marx ;-). ;-). ;-).

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