ISO Congress GM 28.04.07

Economic report of the member countries

 

S – Sweden  (Finland)

 

The situation in the Nordic countries is very much like last year, with minor variations:  We are all “too busy” in the following order:  Norway – Sweden/Denmark - Finland.

 

Sweden changed in 2006 from a Social democratic minority- to a Liberal (4-party) majority-government resulting in some important changes and new dynamics.

 

The unemployment rate is slowly reduced, and new incentive regulations may further reduce the youth unemployment in particular – a very Swedish problem, partly as a consequence of large numbers of immigrants.

(Sweden takes more than 50% of all EU immigrants from Iraq as an example!)

 

Retail trade growth has kept increasing with about 5% p.a., which creates optimism for the benefit of the Shopfitting Industry, accentuated by the accelerating demand for better and more exciting shopping experiences by the consumers. Malls and large retail concentrations are “in” and so are flagship stores and renovations to keep Cities’ downtowns alive.

 

The Swedish furniture industry (incl. shopfitting?) had considerable production increase (and productivity increase due to automation) with a growth in the Export value of 12% to 14,3 billion Swedish Kroner (1,55 billion Euro).

The Swedish manufacturing Industries brag about being top most automated in EU (Is that because we are lazy, or?).

 

New laws cancel capital tax completely, and reduce property tax drastically, and is said to make Sweden a future “Investor’s Paradise!”  Let me give you an example:  You want to invest a billion in a new business, and Sweden is offering virtually no tax on the capital and property, and average (or below) on the revenue!

What competing Western societies can beat that?

 

The drawback is tax on work, which is an average of 31,5 (as % of GNP), while the average of the 15 Western EU members is 20,1%!  The reason and need for this (as explained in “The roots of growth” by Lars Anell, former Swedish Ambassador and Volvo CEO) is a large public sector. Anell states that a cost of the public sector of15-20% of the BNP has no proven negative influence on growth. However, the Swedish public sector costs 27%!

 

The Industry understands the political message as:  “Reduce labour and Invest in automation” (Do the politicians know ?)

 

And to our famous expatriate countrymen, such as Ingvar Kamprad (Ikea) in Switzerland, Pärsson (H&M) in London or Monaco,  Rausing (Tetra Pack) in London, and all the rest of them out there, the message is:  “Welcome home!”

 

The 5 leading Swedish shopfitters are: Successful Samuelsons (and Gron-Hansen) now New Store Europe,  ITAB , ROL, Hestra and Pelly (new ISO direct member), and they are all busy. So are an almost endless number of small niche, and local shopfitters.

 

The risks are Global: Energy cost, pollution war, terrorism, political crises, etc.

But the professional and flexible companies, those who knows the industry they are in* are the winners in the Global, as well as local, competition in the 21st.Century.

                                                                               

Conclusion:

Increasingly good business to the good companies*, and positive prospects in the near future (2-3 years?).

Extra capacity probably available due to automation, but the bottleneck is professional managers and skilled labour.

 

                                     

Preben Bailey,

ISO Secretariat in Sweden.

(Seconded by individual Swedish member Pelly Butik AB)

 

*) And the good companies and the winners are ISO Members, of course. PB.