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OPINION AND ANALYSIS

Six things I’ve learned after six months in Sweden

Australian singer and writer Sheona Urquhart looks back at her first six months in Sweden in this guest blog for The Local.

Six things I've learned after six months in Sweden
Sheona Urquhart on the beach of Fårö, Gotland. Photo: Private

It’s difficult to think that this chilly Stockholm is the same city that was basking in 25-degree heat only a few months ago. Back then was also the time when, against the fitting backdrop of Eurovision, I stumbled off a 32-hour flight, jet-lagged to the heavens, but ready to begin my new life in Sweden.

Moving to Sweden has been life-changing, wonderful and completely challenging. On the one hand, a fresh start is so exciting and energizing. On the other hand, I have often felt a bit like a toddler at a grownups party – in need of guidance, struggling to communicate and, particularly over these latest icy weeks, still figuring out how to walk.

But Sweden has been one pleasant surprise after the other. As more expats continue to flock to these fabulous Scandinavian cities, I thought it would be a nice time to share a few of the learnings I’ve made over the last six months for future Arlanda airport arrivals.


Sheona Urquhart visiting the island of Gotland. Photo: Private

Expats and Swedes

Swedes are incredibly welcoming to expats and it’s easy to fit into society here. However, after a while living in Sweden, you can start to notice some slight, often amusing, cultural differences. A common one (especially for us Aussies), is that we’re considered loud here. Quite loud. I’ll never forget one casual Sunday fika that somehow resulted in my Aussie mate and I squawking with uncontrollable laughter, whilst throwing our bodies back and forth in sheer hysteria… much to the silent shock of the surrounding, significantly more civilized Swedes. Be ready for that.

Coffee doesn’t mean the same thing here as it does at home

This is very, very important, especially if you’re usually a long-black drinker. Swedish coffee is a force of nature – this can’t be stressed enough. Simply ‘trying Swedish coffee’ should only be done in a carefully controlled environment – trust me, you don’t know what this hot, devil liquid could do to an un-trained stomach. If you want my advice, try one with a good quarter litre of milk and two sugars and gradually work your way to black… don’t say I didn’t warn you.

Turns out Sweden is successful at everything

This was difficult to swallow at first, but it’s something we’ve all had to eventually accept. There’s the well-known successful Swedish exports like Spotify, H&M, Ikea and Robyn, but the longer you’re here you’ll really discover how gifted Sweden is at being…well, gifted. If stunning musical artists like First Aid Kit, Laleh and Ted Gärdestad aren’t enough, Sweden has the Nobel Prize, automatically booked doctors appointments, Zlatan Ibrahimovic and summer-time strawberries that will be the best you’ve ever had. Swedes are so inventive, they can take literally the most disastrously designed ship, fetch it from the bottom of the harbour and turn it into one of Stockholm’s most visited tourist attractions. Gifted.

Snow in Sweden is glorious! Until you have to walk in it…

Have you ever seen that scene of Bambi trying his hooves out on ice for the first time? Slipping and stumbling with every step, limbs becoming entangled and a steady decline in pride? You can’t get a more accurate image of what my life has been like stepping outside this month. Speaking from experience, only the first four falls are embarrassing. After that you’ll learn to let go of all dignity, so long as you try to avoid collecting other civilians on the way down. In other news, turns out MacBook pros are a lot more water resistant than you think!


Snow in Stockholm in November. Photo: Henrik Montgomery/TT

Heaven on earth exists

I’m convinced the island of Gotland is a slice of utopia that toppled from the sky and landed off the east coast of Sweden. What an island – it’s a must on any to-visit list. Having said that, there’s also plenty of stunning areas in Stockholm that still make my heart skip a beat, six months in. A morning walk around Sickla Sjö can make you feel like you’ve accidently wandered through a cupboard at Ikea and ended up in Narnia.

The reason you come to Sweden is not always the reason you’ll stay. And you will stay.

As is often the tale, I originally moved to Sweden for love. And now, like a surprisingly large number of expats, I’m still here even after the relationship didn’t work out. Of course it felt strange suddenly losing the reason I had decided come here in the first place. Stranger still, however, was that I didn’t consider leaving Sweden once I’d lost it.

Perhaps I’d started a different relationship back when Dami Im was gracing Globen’s Eurovision stage in May – with Stockholm. After all, in the last six months Stockholm has taken me in, given me adventures, a wonderful job and the start of a beautiful career in music. Stockholm is a city of innovation, creativity and it has plenty of support. It’s also home to some of the coolest, kindest and most open-minded people I’ve ever met. How could I leave?

I wonder at what stage expats start to feel like a real resident in Stockholm? Is it the purchase of the first monthly SL public transport card? The first time you curse under your breath at not being able to book the time you wanted for the communal laundry? The first midsummer? The pure joy of no longer being an alien once your personal number has been processed? Or perhaps when you make the transition from making fun at your friends using a shoe horn, to using one yourself?

In any sense, for me it happened somewhere over the last six months and I’m so happy to call this funny, cucumber-shaped country my home.

Thanks for making me feel so loved, Stockholm. I can’t wait to see what the next six months bring.

Catch Sheona at live gigs around Sweden with Swedish singer-songwriter, Jade Ell. Visit www.sheonaurquhart.com. She also keeps a blog on her adventures at www.sheoblabs.wordpress.com

Do you want to write a guest blog for The Local? E-mail us at [email protected].


Sheona and her music partner Jade looking out over Sickla Sjö. Photo: Private
 

For members

EUROPEAN UNION

Should Sweden abandon a weak krona for the euro?

With the 20th anniversary of Sweden's euro referendum this month, the weak krona has revived the long dormant debate over Swedish membership. We look at why joining the single currency looks more attractive today.

Should Sweden abandon a weak krona for the euro?

The krona hitting rock bottom has reawakened a debate that had been dead for twenty years.

Hedge fund manager Christer Gardell kickstarted the debate before the New Year, when he said Sweden should abandon the krona, which was now “a shitty little currency”. In January, the Moderate Party grandee Gunnar Hökmark, chief of the Frivärld think-tank and long-term euro advocate, argued that Sweden should join.

Veteran economist Lars Calmfors, who chaired the government inquiry which in 1999 recommended that Sweden stay outside, made a similar call shortly afterwards. Carl Hammer, chief strategist at SEB, who had voted against joining in the 2003 referendum wrote in May that he, too, was now “leaning towards a ‘yes'” on euro membership. 

Now one of Sweden’s three government parties has started to campaign on the issue. The Liberal Party, long in theory in favour of euro membership, on September 4th called for a new government inquiry on joining the currency. 

“We can quite simply no longer afford to stay outside [the euro],” the party’s leader Johan Pehrson wrote in the Aftonbladet newspaper. “Let’s upgrade our EU membership from ‘basic’ to ‘premium’. Let’s bring in the euro now!'” 

Is it a hot topic? 

According to Calmfors and Hammer, the debate is raging in the circles they move in, but has yet to really spread to the general public. 

“Between 2010 and the end of last year, I don’t think I was asked even once to speak about Sweden and the euro. But now I have two or three invitations each week, and in fact six this week when we are approaching the 20th anniversary of the referendum.” 

“I see a lot of academic and business seminars on the weak krona,” Hammer agreed.

For both of them, the revival in interest has come about mainly due to the weakness of the krona, which Calmfors complained had been trading as if Sweden were a “banana republic”. And unlike during the 1999 internet crash or the 2007 financial crisis, when a drop in the krona helped bolster Sweden’s economy, this time the weak currency was causing problems. 

“Earlier it has benefitted us,” Calmfors said. “The krona depreciated and firms could gain market share. It helped stabilise output and employment,” he explained. “But this time, it’s different. Now, the depreciation of the krona counteracts the efforts of the Riksbank to get inflation down and reduce aggregate demand. So this time, it is a problem.” 

For Hammer, the weakness of the krona was more understandable, reflecting a flight to strong currencies in reaction to the war in Ukraine.

“Had we not had Ukraine, and had we not had other global issues, I think the krona would have been stronger,” he said.

Calmfors isn’t so certain about this, pointing out that the Swiss Franc, another small floating currency, has not been similarly weak. He does, however, see the invasion of Ukrainian as the second big reason why the euro debate has revived. 

“The war in Ukraine has made Swedes recalibrate our view of our position in the world,” he said. “The application for Nato membership is the most obvious evidence for this, but I think it spills over to the euro issue as well.”

Lars Calmfors, Professor Emeritus in Economics at Stockholm University. Photo: Anders Wiklund/TT

HOW HAVE THE FUNDAMENTALS CHANGED? 

1. Sweden’s government finances are much stronger

While the weak krona is the catalyst for the debate, for Calmfors, the improvement in Sweden’s government finances is a much better reason for sceptics to change their minds. 

When he submitted his report in 1999, his committee’s main argument against joining was the risk of a country-specific economic shock which would affect Sweden, but not other EU countries. Such a shock would be hard to combat if Sweden no longer had the freedom to set its own interest rates or devalue its currency. 

“We argued that (…) it’s good to have your own monetary policy, an exchange rate that can change,” he said. 

At that time, Sweden’s national debt was at 70-75 percent of GDP, well above the 60 percent that is the (increasingly theoretical) maximum for countries signed up to the EU’s Stability and Growth Pact.

“This was very important in the 1990s, because we had a sovereign debt crisis in Sweden, so fiscal policy could not be used as a substitute for monetary policy,” he remembered. 

Now, Sweden’s national debt is just 35 percent of GDP, well below that of France at 98 percent or Germany at 60 percent and, for Calmfors, this removes the biggest obstacle to joining, as Sweden’s government would be able to spend its way out of any country-specific shock.

“That’s very low in an international context, so we have a lot of fiscal firepower. No one would argue with us if we had an expansionary fiscal policy.” 

Hammer, arguing along the same lines, pointed out that in the years before and since the euro referendum, Sweden had never in fact suffered the sort of country-specific shock that Calmfors and his committee had worried about. The Riksbank, meanwhile, had always run a monetary policy in line with that of the European Central Bank. 

“For the past 30 years, Sweden has been living with a floating exchange rate but living as if we’ve had a fixed exchange rate,” he said. 

The country, he explained, had had strict limitations on government spending, a surplus target, a very coordinated and orderly wage bargaining process, and a fully funded pension system. “So if any country would have the room and possibility to live with a fixed exchange rate, it’s Sweden.”  

2. Businesses don’t use the krona anyway 

For Hammer, the biggest new argument against the krona is not so much improved government finances as the fact that Sweden’s big companies now barely use it.

And the same goes for Sweden’s pension funds.

“Large corporations don’t want to deal in the krona – they prefer to make transactions and trade in euros and dollars – and we channel a huge part of our surplus or excess savings into foreign asset markets,” he said. “So, we’ve already to some extent adopted foreign currencies, but we’ve also kept the krona, which from my perspective makes the arguments for having it less strong.”

It is this which has pushed him towards a “yes” despite continuing to believe that the euro is “a suboptimal currency union”.  

“I’m leaning towards voting yes if we were to have a new referendum on the basis that the foundation for the currency has been undermined by the fact that we’re so dependent on foreign currency,” he said. “From that perspective, I think, you can make a case for joining the euro on the grounds of greater financial stability.” 

3. After Brexit Sweden looks more and more alone

With the UK leaving the European Union altogether, Croatia joining the euro this year, Bulgaria scheduled to join in 2025, and Romania in 2026, the number of countries who are in the EU but not the eurozone is falling. 

“If you ask people, like Swedish commissioners in the EU or people that have been doing negotiations in in the EU, they have the view that we have lost out by not belonging to the core,” Calmfors said. “The risk that we will lose out probably becomes bigger, the greater the share of EU countries that adopt the euro.”

Carl Hammer, chief strategist at Sweden’s SEB Bank. Photo: SEB

WHAT ARE THE STRONGEST ARGUMENTS NOT TO JOIN?

1. The risk of country-specific shocks is real 

Just because Sweden has more fiscal firepower to deal with a country specific shock does not mean the risk of such shocks is not a major drawback to euro membership. 

Finland suffered one when Nokia, far and away the country’s biggest company, mismanaged its reaction to the launch of the iPhone and exited to the mobile phone business. Between 2008 and 2022 its debt to GDP ratio more than doubled from 33 percent to 74 percent. 

Greece, Italy, Spain and Portugal arguably suffered from the issue during the European banking crisis.

As Sweden’s economy is unusually sensitive to interest rates, with much higher private debt and a high share of variable rate mortgages, the ECB could easily set an interest rate that, while right for most eurozone countries, would be too high for Sweden. 

“That could be a problem, but it’s also a problem that could be dealt with by using fiscal policy,” Calmfors argues. 

2. The risk of bank bailouts and country bailouts remains 

The other big argument against joining the euro, which was clearly demonstrated during the European debt crisis from 2009 until about 2014, is that Sweden would have to help bail out countries, such as Italy and Greece, which have been less disciplined in the management of their government finances. 

Joining the euro would also mean joining the European Banking Union, which means that Sweden might also have to participate in rescuing banks in countries with less well-functioning financial supervision.

Calmfors acknowledged that this was still a risk, but argued that members of the European Union who are not part of the eurozone were increasingly being asked to contribute to rescue packages anyway. 

“If you look at the support after the Covid crisis and during the Covid crisis, we had to pay that as well, even though we were not a member of the monetary union,” he said. 

And when it came to bank bailouts, Sweden was, he argued, as likely to benefit as to lose out, given the high indebtedness of Sweden’s citizens. 

“We might end up having to pay for bank crises in other countries. But on the other hand, we would also be helped if we had a financial crisis, which of course is not something we can rule out,” he said. 

Also, he said there might be an advantage in having banks and other financial services regulated by the European Central Bank and other European regulators, as a European regulator might have more expertise, there are many cross-border links between banks, and there would be less of a risk of a cosy relationship building up between local banks and the regulator.   

HOW HAVE THE ADVANTAGES OF EURO MEMBERSHIP CHANGED?

Calmfors argues that while the negative risks of adopting the euro have diminished, the advantages remain more or less the same. 

“The biggest benefit is of course that having different currencies is a kind of trade impediment and that would be eliminated, which would mean more trade, which would mean that we use our resources more efficiently, so it would give slightly higher growth over a long period, which, even if small each year, would accumulate to quite a lot in the long term.” 

Recent research suggested, he added, that this effect might be more significant than people previously thought. 

“Studies seem to point to much bigger effects than we expected in the 1990s. We’re talking about a 10 to 20 percent increase in trade, not from one year to another, but over a number of years,” he said. 

The problem with the debate over euro membership had always been, he concluded, that the benefits and risks were of such a different character. 

“You can’t really make an economic calculation, because you are comparing different things: We are comparing small, but certain positive gains – because there will be more trade that we will get slowly over years – with a risk of big macroeconomic shocks that can have huge effects over a few years.”

This makes it hard for economists to reach a firm conclusion. 

“You can’t really say what is right and wrong, but I think what you can say is that the balance has shifted in the direction of being a more positive calculation for being a member today than there was 25 years ago.” 

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