Sweden

In-depth country-focused analysis on Sweden's economic, political and operational risk environment, complemented by detailed sector insight

Sweden

Our comprehensive assessment of Sweden's operating environment and the outlook for its leading sectors are formed by bringing together a wealth of data on global markets that affect Sweden, as well as the latest industry developments that could impact Sweden's industries. This unique integrated approach has given us an impeccable track-record for predicting important shifts in the markets, ensuring you’re aware of the latest market opportunities and risks in Sweden before your competitors.

Country Risk

Sweden Country Risk

BMI View:

Core Views

  • Sweden will remain a growth outperformer among developed states, with domestic demand remaining strong in 2016-17.

  • The surge in migrant inflows in 2015-16 will lead to higher economic growth over the medium term, but will present challenges to the fiscal accounts, the labour market, and domestic political stability.

  • Interest rates will remain low through 2017 as the central bank (Riksbank) will maintain a negative policy rate and disinflationary conditions will persist. However, there is an increasing chance of a policy reversal in 2016, as extraordinarily easy monetary measures are inappropriate given strong economic growth, incipient inflation, and rising private sector debt.

Major Forecast Changes

  • With higher-than-expected real GDP...

Sweden Industry Coverage (20)

Autos

Sweden Autos

BMI View:

BMI View: We continue to believe that a growing economy and buoyant consumer confidence will ensure another positive year for Swedish new car sales in 2016, although sales growth may slow from the double-digit expansion seen over 2014 and 2015. We expect 4.8% growth for the sector as a whole, with passenger cars to outperform commercial vehicles.

Passenger Car and Light Commercial Vehicle Sales
(2014-2020)
f = BMI forecast. Source: BilSweden, BMI

...

Commercial Banking

Sweden Commercial Banking

BMI View:

...
Commercial Banking Sector Indicators
Date Total assets Client loans Bond portfolio Other Liabilities and capital Capital Client deposits

Food & Drink

Sweden Food & Drink

BMI View:

BMI View: A consumer base with some of the strongest purchasing power in the world, combined with a favourable business and regulatory environment, will continue to be an attractive characteristic for food and drink companies operating in Scandinavia. That said, market concentration and a weak demographic outlook will limit growth for new entrants.

Latest Updates & Industry Developments

  • Throughout our forecast period to 2020, household spending will experience healthy growth in the Nordics, given...

Information Technology

Sweden Information Technology

BMI View:

BMI View: Despite its developed market status, we have an upbeat perspective on Sweden's IT industry, owing to the presence of a supportive economic environment and advanced composition of the enterprise segment. These market characteristics are expected to drive growth in spending on new technologies such as advanced cloud computing services, and software and services required for the Internet of Things. We also highlight the potential for Sweden to be a leading adopter of labour saving smart automation and assistant technologies as a result of high labour costs and its status as a leading innovator. However, this trend would be concentrated in the latter years of our forecast. Meanwhile, despite its maturity, we believe there to be opportunities in the retail market where strong private consumption growth has the...

Infrastructure

Sweden Infrastructure

BMI View:

BMI View: A booming housing market, a strong major project pipeline, especially in the rail transport, and committed government spending make Sweden an attractive investment destination. A further boost is expected from the surge in immigration and the pressure this will put on housing demand and how this will affect an already overheating housing market.

Latest Updates And Structural Trends

  • As immigration soars in Sweden, 300,000-500,000 more homes may be needed by 2020, providing a significant boon to the already healthy residential construction sector.

  • The transport network is the focus of investment under the 2014-2025 national infrastructure plan, with USD76bn allocated to transport network improvements.

  • Sweden's construction industry growth is slowing, but it is...

Insurance

Sweden Insurance

BMI View:

BMI View: The latest news flow confirms our view that Sweden's life insurance sector will continue to grow faster than nominal GDP through the forecast period, with the result that life penetration rises from what are already very high levels of about 6% of GDP. By contrast, price competition will constrain the expansion of premiums within the property and motor vehicle insurance sub-sectors and, therefore, across the non-life segment as a whole.

Headline Insurance Forecasts (Sweden 2013-2020)
2013 2014 2015e...

Medical Devices

Sweden Medical Devices

BMI View:

BMI Industry View: The medical device market is expected to experience moderate growth in local currency terms over the 2014-2019 period, although growth in US dollar terms will be constrained by a depreciation of the Swedish krona against the US dollar, which will result in a downturn in 2015 before the market returns to growth from 2016. While Sweden has a strong medical device manufacturing industry including a number of major international companies, the majority of domestically produced medical devices are exported, leaving the domestic market heavily reliant on imports.

Headline Industry Forecasts

  • We forecast the medical device market will grow at a CAGR of 2.7% in US dollar terms over the next five years, rising from USD2.5bn in 2014 to USD2.9bn in 2019. The low dollar growth rate reflects the falling value of the Swedish krona...

Metals

Sweden Metals

BMI View:

BMI View: Tin prices will be capped by US dollar strength in 2016, leading us to trim our price forecast to USD14,500/tonne. Beyond 2016, prices will recover gradually as the global tin market posts sustained market deficits and inventories dwindle.

...
Global - Tin Supply, Demand & Price Forecasts
2014 2015e 2016f 2017f

Sweden Metals

BMI View:

BMI view: We will maintain our aluminium price forecast for 2016 at USD1,575/tonne. Although prices will bottom in H116, production will outstrip consumption until 2018 and anchor prices. In particular, cheap Chinese exports will keep the market well supplied.

...
Global - Aluminium Supply, Demand & Price Forecasts
2014 2015e 2016f 2017f

Sweden Metals

BMI View:

BMI View: Globally, iron ore prices will remain subdued due to weak demand growth in China and expanding output by major miners in Australia and Brazil. China will see output slow as the country's iron ore miners operate on the higher end of the global iron ore cost curve.

...
Global Iron Ore Forecast
2014 2015e 2016f 2017f 2018f

Sweden Metals

BMI View:

BMI View: Nickel prices will bottom in 2016 as weak production drags the global market into deficit. For instance, we expect Chinese imports of nickel to grow over the coming quarters. Prices will begin 2016 weaker than we had previously expected and we have thus revised down our 2016 average price forecast to USD9,000/tonne from USD10,500/tonne.

...
Global Nickel Forecasts
2013 2014 2015e

Sweden Metals

BMI View:

BMI View: We have revised down our average copper price forecast for 2016 to USD4,900/tonne. We expect prices to find a floor over the first half of 2016, and begin to stabilise thereafter, supported by production cuts and modest consumption growth.

Global - Copper Supply, Demand & Price Forecasts
2014 2015e 2016f 2017f 2018f ...

Sweden Metals

BMI View:

BMI View: Gold prices will prove resilient in 2016 due to a dovish shift in global monetary policy and elevated systemic financial sector risks. However, we do not foresee a sustained multi-year recovery and the mining sector will thus remain under significant stress. We forecast slowing mine production growth and increasing consolidation.

BMI Gold Forecasts
2014 2015 2016f 2017f ...

Sweden Metals

BMI View:

BMI View: Global steel prices will remain subdued due to a persistent steel oversupply over the coming quarters. From 2017 onwards, steel prices will gradually edge higher as the global steel surplus will narrow due to Chinese supply moderation.

Steel Price Forecast
2014 2015 2016f 2017f 2018f 2019f...

Sweden Metals

BMI View:

BMI View: We maintain our average zinc price forecast for 2016 of USD1,750/tonne. We expect zinc prices to reach a floor over the first half of 2016, and begin to stabilise thereafter, as production cuts shift the market to a deficit.

...
Global - Zinc Supply, Demand & Price Forecasts
2014 2015e 2016f 2017f 2018f

Sweden Metals

BMI View:

BMI View: Lead prices will gradually edge higher as the global lead market will shift into deficit by 2017 as production growth will slow over the coming years.

...
BMI Lead Price Forecast
Current* 2016f 2017f 2018f 2019f 2020f

Pharmaceuticals & Healthcare

Sweden Pharmaceuticals & Healthcare

BMI View:

BMI View: Sweden's epidemiological profile will continue to be attractive to manufacturers of medicines for non-communicable diseases. Despite the relative rapid uptake of innovative pharmaceuticals, the burden of chronic conditions will increase over the next 15 years. Presenting a challenge to drugmakers, like many other developed states, Sweden is introducing cost-containment measures to restrict the commercial opportunities available to drugmakers.

Headline Expenditure Projections

  • Pharmaceuticals: SEK39.50bn (USD4.68bn) in 2015 to SEK39.79bn (USD4.68bn) in 2016; +0.74% in local currency terms and -0.1% in US dollar terms.

  • Healthcare: SEK371.82bn (USD44.09bn) in 2015 to SEK381.68bn (USD44.88bn) in2016; +2.7% in local currency terms and 1.8% in US...

Power

Sweden Power

BMI View:

BMI View: This quarter our fundamental assumptions for Sweden continue to be relevant. Taking into account relatively positive macroeconomic expectations for the Nordic region as well as sector trends, we continue to expect power consumption growth in 2016. Similarly, we maintain our long-held view that, while growth expectations in the region are improving, economic woes in the eurozone remain a major risk factor for the consumption and generation outlook of the country, as more regional instability...

Telecommunications

Sweden Telecommunications

BMI View:

BMI View: Saturation in Sweden's telecoms market means operators are looking to diversify their product portfolios to find new revenue streams. With the ongoing shift from fixed solutions to mobile services, operators are increasingly turning towards the Internet of Things and connected products, such as cars, to drive growth. However, the success of these solutions in increasing average revenue per user (ARPU) may be limited unless they are bundled as part of shared data plans.

Latest Updates & Industry Developments

  • Mobile subscriptions will reach 14.4mn in 2016, at a penetration rate of 145.8%, indicating the saturation of the market.

  • The broadband segment continues to experience modest growth, with 5.7mn...

Tourism

Sweden Tourism

BMI View:

BMI View: Sweden's tourism market is relatively small compared to more established Western Europe destinations, such as France, Spain and Italy. The country is heavily dependent upon regional travel from neighbouring Nordic states, many of which are being impacted by the fall in global oil prices and a slowdown in economic growth leading to a weak short-term growth forecast. The medium-term outlook is stronger, with rising visitor numbers and a healthy investment environment supporting growth in the hotel sector, particularly outside of the capital in up-and-coming tourism destinations such as Malmo and Lund.

...
Key Forecasts (Sweden 2013-2020)
2013e

Latest Sweden Articles

  • Norway's plan to opt out of the REC scheme for non-hydro renewables and hyd...

  • Britain's exit ('Brexit') from the EU would have significant geopolitical i...

  • Through zero-rating the use of social networks, Telia intends to boost its ...

Latest Sweden Blogs

  • BMI Research regularly carries out scenario analysis of 'low probability-hi...

Latest Sweden Podcasts

  • Europe's 20-year telecoms competition initiative has benefited million...

  • The operating environment for energy firms in the European Union is ex...

×

Download PDF

By submitting this form you are acknowledging that you have read and understood our Privacy Policy.

Thank you for your interest

You will shortly receive your free executive summary by email.