After long years of talks Brexit is final. There will undoubtedly be the initial pains of transition. Each EU country only has to renegotiate terms only with the UK. On the other hand the UK government must work on many new bilateral deals. However a bigger question looms. Is Brexit a trendsetter? For countries like Sweden this question warrants a closer inspection.
Euroscepticism after Brexit
Some EU member countries never replaced their national currencies with the Euro. The UK was one. Sweden is another. In 2016 Sweden’s largest market research company Sifo conducted a poll. This was right after the UK’s Brexit referendum. The poll showed that Sweden is a country that could likely be inspired by Brexit. The survey showed that 36% of Swedes would want to follow the UK out of the EU in the event of a Leave vote. With Brexit now final, Euroscepticism is at its peak.
A possible “Swexit”
In April 2016 Goran von Sydow, a political scientist and researcher at the Swedish Institute for European Political Studies made an observation. He said, “If there’s going to be a ‘Brexit’, then this would raise so many questions related to the impact on the EU and the Swedish membership.” His reasoning was that Brexit would make Sweden’s EU membership more difficult and, as he said, “lonely”. Sweden is not in the eurozone.
The events of last year showed a departure from this mindset. In February 2019, ahead of the country’s upcoming elections, Sweden’s Left Party voted to drop the pledge for Sweden to leave the EU. Party leader Jonas Sjöstedt told a Swedish news platform that he was happy with that decision. He expressed his commitment to staying in the EU by saying, “We are not going to campaign on a pledge that Sweden should leave the EU.”
In November 2020 Sweden’s parliament, the Riksdag finalized some of the Brexit arrangements. British citizens who arrived in Sweden to live, work, and study prior to December 31, 2020 will retain their right to stay in Sweden. They will have to apply for a new residence status with the Swedish Migration Agency. To ease out the process the agency will accept online applications exclusively from British citizens to whom these terms apply. The permits will have to be renewed every 5 years. By mid January 2021, 4,500 of the 20,000 Brits that live in Sweden had applied for the new permits. Fortunately Brexit does not change things much for non-EU expats in Sweden. Expat professionals can continue to work and send remittances to their home countries via the Ria Money Transfer App and other trusted channels as usual.
Research by Oxford Economics and the Swedish Chamber of Commerce indicates that the costs of Brexit will be lower trade, weaker economic integration, and reduced predictability in business between the UK and the EU. Swedish exports equate to almost half of the country’s total GDP. The importance of trade to Sweden’s national economy is obvious. Research shows that Sweden’s GDP will reduce by 0.3% due to Brexit. This amounts to a total accumulated loss of SEK 18 billion over 2 years after Brexit. Other possible effects of a decline in trade could be decreased foreign investment, a decline in employment, and slowed economic growth. Brexit threatens up to 8,200 Swedish jobs, of which up to 2,100 will be in Stockholm.
As other EU nations, Sweden will look for substitutes to recover the losses in trade with the UK. Swedish businesses will strenthen their ties and find new markets in other EU countries. This could lead to more commerce across the Baltic. Freedom of movement and trade are important aspects. The UK will remain an important trading partner for Sweden. However its importance is likely to gradually decline.
About the author:
Hemant G is a contributing writer at Sparkwebs LLC, a Digital and Content Marketing Agency. When he’s not writing, he loves to travel, scuba dive, and watch documentaries.