Stockholm is a digital city. Almost all purchases are cashless. A thriving startup scene produces many of Europe’s success stories. Yet as snow envelopes the Swedish capital and Sweden prepares to take over the six-month EU presidency on January 1, this tech-friendly country exhibits little ambition to exert influence over EU tech policy debates.
A number of reasons explain Sweden’s modest ambitions. A right-wing government recently took office and is new to EU affairs. Brexit took away the bloc’s biggest pro-free-trade, pro-market voice, leaving Sweden to feel isolated politically. Rather than tech, Sweden’s EU priorities are the war in Ukraine and the continent’s energy crisis and climate change, the country’s Minister for Foreign Affairs Tobias Billström told the Atlantic Council on a trip to Washington. The Scandinavian country is preoccupied with its own bid to join NATO and with imposing new rules to limit the arrival of refugees.
Sweden is skeptical about a trade truce with the US. Although officials acknowledge the Biden Administration’s friendly rhetoric, they see few fundamental changes compared to President Trump. In their view, the US risks veering into protectionism, intent on engaging in a trade war with China and saving US jobs. Foreign Minister Billström calls Beijing “a competitor,” not an “adversary.” He plans “to sit down and talk” with US officials about how to deal with China.
Like other Europeans, Swedes oppose Washington’s plans to subsidize domestic electric cars at the expense of European carmakers. China’s Geely owns Sweden’s flagship carmaker Volvo, an electric car leader, though some Swedes are having second thoughts about the tie-up’s national security risks. A direct threat is the new US Inflation Reduction Act, under which US Volvo buyers no longer will qualify for tax credits. Swedish electric car battery maker Northvolt may delay its planned German plant to take advantage of the Act’s incentives to expand in the US.
Sweden takes a hard line on tech regulation. Its emphasis on consumer protection resembles neighbor Denmark’s. On EU legislative files, this translates into jawboning e-commerce marketplaces into taking additional responsibilities for the products offered on their sites for sale. A new General Product Safety Regulation has been approved and dossiers on eco-design that would require marketplaces to vouch for products’ “green qualities.”
At the same time, Sweden, as a small exporting nation, prides itself on being a free trader. It promotes transatlantic data flows, supporting the US executive order that underpins a new Privacy Shield. It promotes digital free expression. It is wary about the French belief in “digital sovereignty.” Unlike many in Europe who fear digital disruption, Sweden believes the Internet is the motor of its own economic growth.
The political expression of these ideas is the D9+ initiative. Launched in 2016 by former Swedish trade minister Anne Linde, the D9+ brings together nine, small pro-digital countries with “a strong interest to exploit the economic power of digitlisation and new emerging technologies.”
Yet Sweden strangely continues to punch below its weight in EU tech policy circles. In conversation, Swedish officials make little mention of D9+ and predict a “boring” EU presidency. The bloc president is meant to serve as an honest broker, not to press its own political preferences. Sweden’s six months in charge come as the European Commission begins to wind down its term, which ends in 2024. Few new proposals are expected. Instead, Sweden’s role will be to push ahead on existing EU dossiers on semiconductor subsidies, data sharing, artificial intelligence, and media freedom.
One explanation for the modest ambition is that Sweden finds itself in political transition. The long-ruling Social Democrats lost September’s election, which was marked by the rise of the anti-immigrant far-right Swedish Democrats. A three-party coalition took office in October, supported by Swedish Democrats, and the government’s priority is to curb the country’s long Open Door border policy. 14% of the population is foreign-born. The new government has already tightened immigration and asylum procedures.
Swedish officials acknowledge that they need to step up their engagement in Brussels. From its perch in the far north, Sweden tends to be preoccupied with its own affairs and spends little political capital on European policies. Given the UK’s departure, the EU needs to hear its pro-tech, pro-free trade voice.
Bill Echikson is the Acting Director of CEPA’s Digital Innovation Initiative.
Bandwidth is CEPA’s online journal dedicated to advancing transatlantic cooperation on tech policy. All opinions are those of the author and do not necessarily represent the position or views of the institutions they represent or the Center for European Policy Analysis.
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