Sweden ups growth forecast

  • 2002-08-22
STOCKHOLM

The Swedish government, facing a general election next month, gave sharply improved forecasts for economic growth and unemployment and hinted at welfare improvements if it wins the Sept. 15 poll.

Finance Minister Bosse Ringholm said last week he expected the gross national product to grow by 2 percent in 2002, which compares with the government's spring forecast of just 1.4 percent.

The unemployment rate is now expected to drop below 4 percent by the end of the year, compared with an earlier forecast of 4.3 percent.

"I am delighted that the Swedish economy is recovering so strongly," Ringholm said in a statement, adding that Sweden can now expect one of the strongest growth rates in the EU.

Ringholm said the upward revision was an outcome of strong consumer spending, which he said had been stimulated by recent tax cuts.

Sweden, which runs a budget surplus, should have leeway to spend fresh money on improving health care and the pension systems in the second half of 2003, Ringholm said, provided the Social Democrats are returned to power next month.