Sweden's Minister of Finance: Sweden has run out of money

 
Sweden's Minister of Finance: Sweden has run out of money
Yesterday the Swedish government presented fresh economic forecasts. They did not look good.

Growth projections are lowered by 0.6-0.7 percent for this year and next year, unemployment will not drop below 7 percent before 2017 and budget deficits are far worse than expected.

GDP per. capita is still lower than in 2007, and will probably remain lower after 2015 and 2016.

The Swedish Minister of Finance, Magdalena Andersson, yesterday flatly dismissed all ideas to lift Swedish growth by means of fiscal policy.

- There is no money to fund unfunded reforms, said Andersson during a press conference regarding the new, weak estimates.

Swedish fiscal policy has been driven by budget deficits since 2009. The new forecasts show a deficit till 2018, ie for ten consecutive years.

The main reason for weaker growth and higher budget deficits are weaker macro development, said Andersson, who also criticized the previous government's fiscal policy and tax relief.

The previous government completed unfunded reforms and measures corresponding to 4.5 percent.

This has contributed to the budget deficit, which probably peaked with 2.1 percent of GDP last year.

- Money has run out. And it does not look better now than in the fall, on the contrary. We are out of money, said Andersson.

Yet Sweden continues to accept refugees from Syria and other countries, and approximately 100,000 asylum seekers are expected to Sweden in 2015 . Last year a record number obtained asylum in Sweden, and the numbers this year are expected to crush all previous records.

Read: Sweden to become a Third World Country by 2030, according to UN

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