Sweden misused Baltic aid funds

STOCKHOLM - Swedish governmental institutions and politicians have spent the resources of a Baltic aid fund carelessly and unprofessionally, the daily Dagens Nyheter wrote Nov. 6.

The idea of the Baltic Billion Fund was proposed by Swedish Prime Minister Goeran Persson at a summit of the Baltic Sea countries in Visby in 1996.

Sweden's Parliament has endorsed appropriations of 2 billion Swedish kronor for the fund, designed to assist Estonia, Latvia, Lithuania, Poland and northwest Russia.

Based on a report by Erik Hammarskjoeld, director of the fund's secretariat, Dagens Nyheter claims that the money has in many cases been used carelessly and unprofessionally and that there's been no control of spending.

The first billion kronor was to be spent on programs in the food industry, energy systems, education, environment, infrastructure to boost aid through the export potential of Swedish companies and raise local employment levels.

Of the first billion, 840 million kronor have been invested in 68 projects, but all the money is gone and decisions on its investment were made mostly by government departments, not non-governmental institutions with the required experience.

The daily named the Swedish development agency SIDA, which has the necessary know-how and experience, as one of the possible institutions that could have kept an eye on spending.

Although the Hammarskjoeld report evaluates the fund's results on the whole as good, the newspaper finds the 25-page document surprisingly critical, containing charges of unprofessionalism and waste.

Several projects have been launched by politicians and officials who have managed to push through their initiatives, the report reads.

The problem with several projects is a lack of clearly defined objectives, which complicates evaluation of results and control of spending. One spending method has reportedly been for Swedish Cabinet members to tour the Baltic Sea region and distribute funds to increase the government's popularity.

The report further points out that responsibility for projects was often divided between different ministries' departments and users of the funds, thus making it practically impossible to find anyone answerable for the projects.

In conclusion the Swedish daily states that instead of justified goals, the money has primarily been used for political propaganda.

Distribution of the fund is currently under the control of the Foreign Ministry's secretariat. Earlier, cooperation with countries on the eastern shore of the Baltic Sea was the responsibility of Anders Sahlen, former head of the Swedish banking supervisory body and present chairman of the supervisory council of Hansapank.