STOCKHOLM • Sweden, which has opted for a more open strategy in combating the COVID-19 pandemic than other European countries, has seen an increase in the number of deaths per capita recently, and is bracing for a recession.
Sweden has kept most schools, restaurants and businesses open during the pandemic and some theorized it might at least suffer less economic pain. But the latest data challenge that idea.
Scandinavia’s biggest economy will shrink 7 per cent this year, Finance Minister Magdalena Andersson said on Tuesday. And while overall deaths are on the decline, Sweden’s had 6.25 deaths per million inhabitants per day in a rolling average between May 12 and May 19, according to Ourworldinsata.org. That was the highest in Europe on a per capita basis and just above the United Kingdom, which had 5.75 deaths per million.
Over the course of the pandemic Sweden, which reported a total 3,831 deaths as of May 20, still had fewer deaths per capita than the U.K., Spain, Italy, Belgium and France, which have all opted for lockdowns, but the Swedes have a much higher death toll than their Nordic neighbours Denmark, Norway and Finland.
Sweden’s government has made clear its COVID-19 strategy isn’t about putting the economy ahead of lives. Instead, the top epidemiologist, Anders Tegnell, said his approach is more sustainable when tackling a virus that’s likely to be here for the long term.
Possible model
Sweden’s strategy, mostly based on voluntary measures regarding social distancing and basic hygiene, has been criticized by some as a dangerous experiment with peoples’ lives but has also been put forward as a possible model by the World Health Organization.
Michael Ryan, who runs WHO’s health emergencies program, recently said, “If we are to reach a new normal, in many ways Sweden represents a future model.”
Sweden’s open strategy seems to have somewhat softened the blow on the economy, with growth shrinking much less than in Denmark and Norway in the first quarter.
However earlier this week, Sweden’s debt office revealed an historic 30-fold spike in borrowing to cover emergency spending amid record job losses. And a separate survey showed 40 per cent of businesses in Sweden’s service sector fear bankruptcy.
Andersson said her country is now seeing “a very deep economic crisis.” She also said the “deep downturn in the economy is happening faster than we expected.”
Marten Bjellerup, chief economist at the debt office in Stockholm, said he thinks Sweden will fare “somewhat better” than others, but acknowledged “the difference is marginal.”
The trade-reliant economy has been unable to withstand the global shock triggered by widespread lockdowns elsewhere.
“The economy will be constrained by the recovery in the rest of the continent given its dependence on external demand,” said David Oxley of Capital Economics.
About half Sweden’s GDP comes from exports, and some of its best known companies, such as Volvo Cars and Electrolux, have had to cut thousands of jobs as demand dries up.
For now, Sweden’s experiences suggest there might be few economic benefits to leaving an economy open during a pandemic.
Asked whether Sweden might see a quick rebound, Andersson, the finance minister, said “that doesn’t seem very likely at present. We expect a more drawn-out scenario.”
