Diplomatic, political, cultural and economic relations between Sweden and Ukraine date back more than 1,000 years, to the times of the medieval Kyivan Rus empire.
Back then, the nations’ paths crossed on the trade route, which ran from the Vikings in the north to Byzantinum in the south.
In the early 18th century, Ukraine’s hetman Ivan Mazepa struck an alliance with a Swedish king in a bid to gain Ukrainian independence from the Russian Empire and Poland. The endeavor failed when the Russian czar beat the Swedish army in the famous Battle of Poltava in 1709.
Recent history is more cheerful.
The 150 or so Swedes who live in Ukraine are mostly involved in businesses. They include successful agricultural start-ups such as Chumak, a food processing business started by two Swedes, two Swedish banks and the Tetra Pak packaging giant.
One of the key assets of Ukraine is the high level technical education provided by its main universities. We want to attract these competent and skilled persons.
– Olle Tholander, general director of Ericsson in Ukraine
Swedish investment in Ukraine amounts to $1.8 billion, according to the Swedish Trade Council, making Sweden the nation’s eigth biggest investor.
Another landmark is the year 1893, when communications giant Ericsson installed a telephone station in Kyiv and then another in Kharkiv. “Sweden was adapting the new communication technologies very early,” said Olle Tholander, general director of Ericsson in Ukraine, who has previously worked in Japan and England.
Chased out by the Bolshevik Revolution in 1917, Ericsson did not return until 1995. The company now employs 190 people.
“One of the key assets of Ukraine is the high level technical education provided by its main universities. We want to attract these competent and skilled persons,” Tholander said.
Paradoxically enough, Ukraine – which has many information technology specialists working abroad or providing outsourced work – is lagging behind in telecommunications. Ukraine is one of the last European countries to spread 3G – or third-generation – technologies widely, making Internet speeds slower than they need to be.
Currently, the only 3G license belongs to Ukrtelecom, the former state telecommunications monopoly, which was sold to Austria’s Epic for a below-market price in what many called an “uncompetitive tender.”
While Ericsson looks for more “technological freedom,” SEB Bank, part of the Stockholm-headquartered SEB group that arrived in 2005, seeks clearer regulations and stronger rule of law.
“In the crisis, banking showed its weak side,” said Kristian Andersson, deputy chairman of the board at SEB Bank in Ukraine. In Ukraine, the bank mostly specializes in servicing corporate customers from Scandinavia and Germany.
Andersson also has “great hopes that a free trade agreement will be signed with the European Union in the near future.”
The agreement is expected to boost Ukraine’s international trade in general and with Sweden in particular. Those bilateral figures aren’t high – only $260 million in 2010, with Swedish exports making up the bulk of the numbers.
SWEDEN AT A GLANCE
Location: Northern Europe, between Finland and Norway
Government type: constitutional monarchy.
Head of government: prime-minister John Fredrik Reinfeldt
Population: 9 million
Capital: Stockholm
GDP (purchasing power parity): $354.7 billion
GDP – per capita (PPP): $39,100
Swedish globally known businesses:
Ericsson, Electrolux, and IKEA, Volvo, Scania, Tetra Pak, H&M.
Ukraine-Sweden bilateral relations:
- Yaroslav the Wise, a prominent Kyivan Rus prince in 11th century, married Ingegerd, a Swedish princess, whose relics are kept today in St. Sofia’s Cathedral in Kyiv.
- Ukraine has a small community of ethnic Swedes that live in a village in Kherson oblast since the 18th century.
- Kyiv is just a two-hour flight from Stockholm.
- Over 100 companies with Swedish capital are registered in Ukraine.
- Most known Swedish businesses in the nation: Ericsson, Chumak, Oriflame, SEB Bank, Swedbank, Tetra Pak, Skania, SKF.
- IKEA, world’s biggest furniture retailer, abandoned investment plans in Ukraine in 2011, allegedly due to unfriendly business environment.
Swedish investment: $1.8 billion
Investment areas: financial sector, manufacture of home appliances, processing of food and agricultural products, packaging, metalworking and engineering goods.
Bilateral trade: $560 million in 2010, Swedish exports comprise 80 percent. Swedish exports to Ukraine: telecommunications equipment, medical instruments, passenger cars, trucks and buses, manufacturing machinery, heating & cooling, paper and board semi-manufactures.
Ukraine’s exports to Sweden: semi-manufactured products, food products, raw materials, fuels and chemicals.
(Sources: CIS World Fact book, Swedish Trade Council, embassy of Sweden in Ukraine)
Kyiv Post staff writer Katya Grushenko can be reached at [email protected]
