June is a special month for Sweden — and Swedes in Ukraine.
June 6 was National Day, a holiday to celebrate Gustav I’s election as king on this date in 1523 and the adoption of a new constitution on this date in 1809.
June 14 is the 7th annual Sweden-Ukraine Business Forum, this year at the Hyatt Regency hotel.
The economic forum is a time to celebrate rebounding bilateral trade, which in 2017 nearly hit the $500 million mark. It should also attract more Swedish businesses this year, as the Embassy of Sweden took out Swedish-language advertisements in newspapers to promote Ukraine as a “close market.” The forum’s website shows 91 participants thus far however expects up to 250.
But Martin Hagstrom, the Swedish ambassador to Ukraine, told the Kyiv Post that bilateral trade can and should be much higher, especially now that Ukraine has a free-trade agreement with the 28-nation European Union, of which Sweden’s 10 million citizens are members.
“We think that part of the reason is that there remains a mental distance that is longer than the physical distance, in both directions,” Hagstrom said. “Ukrainians tend to think that Sweden is further way. Sweden as well.”
Sweden also suffers from “a huge lack of understanding and information about the situation” in Ukraine, Hagstrom said, with news reports dominated by Russia’s war and other unsettling topics.
“This means for new investors, people who have not worked in Ukraine before, it’s quite a big step for them,” he said.
But none of these drawbacks has stopped the Nordic nation, one of Ukraine’s best friends in the EU, from moving ahead on many fronts.
Ukrainians are awaiting the expected arrival of H&M, the Swedish multinational clothing company, and IKEA, the world’s largest furniture retailer, later this year.
The social agenda is even more packed.
Sweden is one of the world’s richest and most generous nations when it comes to foreign aid. For Ukraine, this amounts to roughly $25 million yearly under a seven-year program that runs through 2020.
Public service TV
Sweden’s priorities include supporting the creation of a strong public broadcaster. It backs efforts to strengthen First Channel, Hromadske TV and Detector Media, a media watchdog.
“Why do we put so much effort into public service broadcasting?” the former journalist asked. “We have a large public service broadcaster in Sweden. It contributes to a stronger media environment overall.”
Swedish media are trusted to deliver the truth fairly, the ambassador said, and several outlets have banded together to “create a special fact-checking service” that is able to counter the type of disinformation that the Kremlin specializes in.
Decentralization
Sweden has also taken a strong interest in training local governments in how to manage the decentralization of tax resources and responsibilities that is under way in Ukraine, where previously all decisions and budgets were set in Kyiv.
“This process is in the beginning in Ukraine,” he said. “There are many challenges in terms of capacities. Regional officials will have to learn quickly how to deal with the new resources. If they don’t learn quickly enough, they will be punished by the voters.”
Again, the Swedish experience plays a big role.
“In Sweden, most citizens pay income taxes only to the regional level,” he said. “Taxes are set by municipalities and regions. Each and every region and municipality has an interest in having as much economic activity as possible. Depending on resources, the municipalities will focus on trying to attract investments.”
The last two years have been the best for Swedish exports to Ukraine since 2011, reaching $402 million in 2017, while Ukraine’s exports to Sweden hit a record high of $89 million.
Gender equality
Seeing the under-representation of women in Ukraine in political and economic life, Hagstrom said that gender equality is high on the Swedish list of priorities as well.
“The starting point is very challenging,” he acknowledged. “But we see progress. We see quite a lot of interest with different ministries who are now interested in promoting gender equality from the starting point of the economic realization that if you don’t use the potential of the whole population, then economic development will suffer. This is very much how it started in Sweden…Now Sweden has the highest level of employment of women in the EU.”
Public procurement
Ukraine’s adoption of more transparent, online competitive bidding for public contracts — largely through the ProZorro system — is paying off for Ukrainian taxpayers — and Swedish businesses. “Small Swedish companies have won Prozbids in local communities,” he said.
Unfinished reforms
Sweden is also keeping an eye on Ukraine’s unfinished reform agenda, including the need to convict somebody for corruption and to establish trusted courts.
Another area of concern is the coming elections in 2019 for president and parliament.
Hagstrom, who arrived two years ago, senses that momentum for reforms has stalled because politicians are focused on the next election.
With respect to election law, he believes that Ukraine would benefit from a completely proportional system for electing parliament because it would help build strong political parties.
The current way — a mixed system with parties often based on personalities — “is not very conducive to reforms,” he said. “There seems to be the lack of strong, cohesive political parties here. This is something that is problematic when it comes to pushing the reform agenda. People are constantly reconfiguring themselves, thinking about what they need to do (to get re-elected). You wouldn’t see that kind of constant bargaining in a system with stronger political parties with a strong ideological base. This is one kind of conclusion that I have drawn.”
Swedish elections
Sweden is undergoing its own political changes ahead of Sept. 9 elections. Support for the anti-immigration Sweden Democrats has surged to 18.5 percent this month, Reuters news agency reported on June 5.
Support for the two government parties fell to 32.6 percent, while the four-party Alliance opposition bloc had just 38.6 percent, according to the same poll cited by Reuters.
Immigration dominates the debate because Sweden has in recent years taken in 165,000 asylum seekers from Iraq, Afghanistan and Syria, triggering a backlash that has led to tighter restrictions on immigration.
Status quo on policy
No matter who comes out on top in the September elections, Hagstrom emphasizes that Swedes are remarkably united on foreign policy questions.
That means Ukraine can count on Sweden taking a hard line on the Kremlin until Vladimir Putin returns the stolen Crimean peninsula and ends the war in the eastern Donbas of Ukraine.
“The European security order is very much the basis for Swedish security and the basis for the kind of Europe we want to see,” the ambassador said. “The illegal annexation in Crimea. Russian aggression in the Donbas. The lack of cooperation we see with the MH17 investigation (in which Russian forces shot down a Malaysian airliner over Ukraine, killing 298 people in July 17, 2014) from Russia and other things on the agenda. This is threatening the European security order.”
And that also means standing by Ukraine’s side, he said.
“We see in Ukraine our role is very much supporting reforms and helping to build a more stable, prosperous Ukraine, which will also then be more resilient.”
The Aurora Borealis, or Northern Lights, illuminate the night sky on June 18, 2013, in northern Sweden. (Lola Akinmade Akerstrom/imagebank.sweden.se)
