Stockholm is synonymous with digital. It outshines other European capitals by producing the most unicorns per capita behind Silicon Valley. It gave birth to fintech superstar Klarna, music streaming giant Spotify, and messaging pioneer Skype. As an exporting nation, Sweden prides itself on its free trade, particularly with partners like the United States.
But Sweden’s tech policy fails to live up to its innovation prowess. Its public sector does not have a strong digital agenda. In 2022, the country ranked ninth in digital public services among EU countries. Unlike the Netherlands and tech-savvy Nordic countries, it does not have a dedicated digital minister. Instead, tech policy is bundled into the Ministry for Public Administration.
In Brussels, Sweden’s voice often stays silent. The country has few representatives focusing on digital issues in the European Parliament. It has no permanent member in the Parliament’s artificial intelligence committee.
Sweden has been largely absent from negotiations on critical digital regulations such as the Digital Services and Markets Act and the new EU AI Act.
In contrast, the country’s Nordic and Baltic neighbors stand at the forefront of EU tech policymaking. Estonian MEP Andrus Ansip served as shadow rapporteur on the landmark Digital Market Act. Danish MEP Christel Schaldemose led negotiations on the Digital Services Act.
Most Nordics, including Sweden, believe in strong regulation, with a focus on consumer rights. Danish MEP Schaldemose, a socialist, has led the charge in Brussels to maximize liability on online marketplaces for hosting dangerous products and counterfeits.
Sweden’s motivated neighbor, Finland, receives frequent praise for playing a key role in advancing pro-tech policies. Helsinki hosts one of the world’s leading startup events, Slush. The country takes strong positions on European digital affairs. Finnish MEP Miapetra Kumpula-Natri holds the Vice-Chairmanship of the parliament’s AI Committee. Helsinki consults with national stakeholders and produces frequent position papers on EU tech proposals. A recent non-paper co-signed by 14 EU members emphasizes the importance of tech forging the EU Single Market.
Until recently, Sweden’s apparent contradiction between an active private and a silent public sector might have proved an asset. The government minimized regulation at home, avoiding enacting barriers to growth. Swedish tech business thrived, attracting investors and innovators. Flush with success, Stockholm saw little need to engage in Brussels. “There was a sense we were already there”, says My Bergdah, Director for Digital Trade at the Swedish digital association Teknikföretagen.
Different issues dominated. At home, a rising crime rate fueled by gang violence soared to the top of the political agenda. Abroad, the country’s stalled negotiations to enter NATO preoccupied Swedish policymakers.
When Sweden took over the six-month rotating presidency of the European Council in the first half of 2023, it focused on the war in Ukraine, climate change, and migration.
This hands-off approach, perhaps appropriate in the past, now looks outdated. EU digital legislation promoting “digital sovereignty” threatens to undermine Sweden’s domestic pro-business, free-trade stance. The country risks losing control over its policies if it fails to assert itself in Brussels, warns Carolina Brånby, Director for Digital Policy at the Swedish Confederation for Business Enterprise.
Apart from regulation, the nature of tech financing is changing. New technologies, especially AI, demand more government funding than fintech or apps such as Klarna and Spotify. Training large language models is expensive, and if Sweden wants to remain Europe’s tech leader, its public sector must support its startups.
The government has started to execute a U-turn. In December of last year, it announced a new AI commission to boost Swedish competitiveness. It plans to initiate a council, tasked with assessing and implementing Brussels legislation. Public Administration Minister Erik Slottner attended a bi-annual meeting of digital frontrunners (dubbed the D9+) in Ireland this month, after a long Swedish absence. Sweden could yet become more assertive on digital policy, leading tech-friendly forces in Brussels.
Clara Riedenstein is a researcher with the Digital Innovation Initiative team at the Center for European Policy Analysis. She graduated from the University of Oxford.
Bandwidth is CEPA’s online journal dedicated to advancing transatlantic cooperation on tech policy. All opinions expressed on Bandwidth are those of the author alone and may not represent those of the institutions they represent or the Center for European Policy Analysis. CEPA maintains a strict intellectual independence policy across all its projects and publications.
Tech 2030
A Roadmap for Europe-US Tech Cooperation
