An image of COVID-19 virus representing the COVID-19 outbreak in Sweden

COVID-19 | The Case of Sweden

Sweden is a country of around 10 million people. The area is 450 thousand sqkm which gives a population density of 22.7 persons/sqkm. The capital is Stockholm with 1.5 million inhabitants, other major cities are Gothenburg (0.6mn), Malmö (0.3mn), and Uppsala (0.2mn). Sweden has been a member of the EU since 1995 but is not a member of the Eurozone.

Different responses across countries to the crisis depend partly on the organization of political authority, as reflected in the level of regional decentralization of decision making in key areas of authority, and the strength and independence of public agencies. In the case of Sweden, the government has three levels, the central government, 21 regions and 290 municipalities. The regions are responsible for – among other things – health care, while municipalities are in charge of elderly care and schools, all institutions which play an important role in the response to Covid-19.

Public agencies in Sweden have a significant degree of independence from the government and line ministers as long as the agency delivers on the mission and guidelines determined by the government. The agency in charge of dealing with pandemics is the Public Health Agency of Sweden (Folkhälsomyndigheten, 2020), which states on their website that “The Public Health Agency of Sweden has a national responsibility for public health issues and works to ensure good public health. The agency also works to ensure that the population is protected against communicable diseases and other health threats.” The Public Health Agency of Sweden has advised the government on which actions to take in the Covid-19 crisis. It is also Sweden’s Coordinating Competent Body for the European Centre for Disease Prevention and Control (ECDC). Other important authorities involved in health recommendations and crisis measures are Socialstyrelsen (Socialstyrelsen, 2020) and the Swedish Civil Contingencies Agency (MSB, 2020).

Health Indicators

Sweden had its first recorded case of Covid-19 on February 1, but then it took until February 27 for the next case to be registered. In the first week of March, a more significant number of people were diagnosed with the virus as people had returned to Sweden with symptoms after having been in the Italian Alps during the school winter holiday the week before. A few early cases were also related to travel to and from Iran. The indicators on Covid-19 numbers in the table are from the ECDC (ECDC, 2020). The OECD provides numbers on nurses and doctors per 1000 inhabitants.

Figure 1: Nurses. Total, per 1000 inhabitants, 2018 or latest available

Picture 1

Source: OECD Health Statistics.

Figure 2: Doctors. Total, per 1000 inhabitants, 2018 or latest available

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Source: OECD Health Statistics.Doctors.

Financial Indicators

Sweden is highly integrated in international financial markets and has a well-developed and liquid stock market. Despite being an EU member country, Sweden keeps its own currency, the Swedish krona (SEK), which is free floating since the Swedish Riksbank is targeting inflation rather than fixing the exchange rate.

The stock market data (see below) is from Nasdaq Stockholm and is the main index of large companies called OMX30.

Figure 3: Stock market data

Picture 3

Source: Nasdaq Nordic

The exchange rate data is from FOREX which provides travellers with foreign currency and is the selling rate for SEK/USD.

Figure 4: Exchange rate data

Picture 4

Source: Forex 2020

The exchange rates are not the same as those that would be used by financial institutions and companies but easily available and movements in this exchange rate, which is what we use here, follow the institutional rates closely.

Laid off workers are the number of workers that have been given notice by their employer that they will be laid off and the numbers are reported on a monthly basis by the Swedish Public Employment Service. In the wake of the corona crisis they are now making more frequent updates to their numbers and have regular press releases to complement their standard data reporting (Arbetsförmedlingen, 2020).

Government Health Policies

In general, the government follows the recommendations of the Public Health Agency of Sweden (PHAS) and other trusted authorities.[1] However, it is also clear that the regions, which are in charge of providing health care, make their own adjustment to some of the recommendations that are issued by the PHAS. For example, the region of Stockholm has adjusted the recommended use of protective equipment to be used by medical staff, most likely in light of shortages. Testing is also not centralized and the PHAS will hold a meeting at the end of March with the different parties involved in testing.

[1] The government states “The Public Health Agency of Sweden coordinates communicable disease control at national level and provides daily updates regarding the situation in Sweden. The National Board of Health and Welfare supports and coordinates the health and medical care preparedness of the various regions. The Government is in daily contact with these agencies. The Government has issued the National Board of Health and Welfare and the Public Health Agency of Sweden several instructions on limiting the spread of SARS-CoV-2. The Government will ensure that the expert agencies and the health and medical care system have the resources necessary to limit the spread of the virus.”

Short Summary of Measures

Mobility restrictions:

  1. Restriction on size of public gatherings; 500 and then 50 people.
  2. Restrictions on bars and restaurants, no standing in line or at the bar, only service at tables.
  3. High schools and higher education institutions are closed and instead provide online education.
  4. Travel to Sweden from non-EU countries is stopped.
  5. Visits to nursing homes are forbidden.

Health care:

  1. Extra delivery of face masks.
  2. Coordinated efforts to procure more medical equipment.
  3. Provision of extra hospital beds and intensive care beds.
  4. Additional government funding to health care providers and related agencies.
  5. Information campaigns to public and social services personnel.
  6. Contributions to WHO emergency fund.

Government Economic Policies

In addition to the health and prevention measures, the government has announced an extensive list of measures to deal with the economic impact of the pandemic. These are implemented by several ministries as well as the central bank and the financial supervisory authority.

Short Summary of Measures

Labor market:

  1. Unemployment benefits extended to more people.
  2. Sick-pay restrictions removed.
  3. Government funding for shortened working time.

Tax breaks:

  1. Tax payments can be delayed.

Emergency loans, guarantees and support:

  1. Loan guarantees to SMEs.
  2. Capital injection to ALMI to support loans to SMEs.
  3. Extra funding for export credits.
  4. Extra funding for export guarantees.
  5. Financial support to culture and sports.
  6. Guarantees to the Nordic airline SAS.

Central Bank measures:

  1. Loans to banks at low interest and reduced collateral restrictions; banks that benefits from these loans pay a fine if they do not increase their credit supply significantly.
  2. Loans to banks in USD.
  3. Purchases of government and mortgage bonds.
  4. Purchases of commercial papers.

Financial regulator:

  1. Counter cyclical buffers for banks set to zero.
  2. Relaxed amortization requirements for households.
  3. Banks allowed to fall below liquidity coverage ratios.


Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.