Experts Renew Call for Sweden to Join the Eurozone Amid Economic Benefits Debate

Sweden is reconsidering its position on joining the eurozone, with recent economic analyses indicating that the benefits of adopting the euro now outweigh the drawbacks. This renewed debate follows a 1996 analysis led by economist Lars Calmfors, which recommended Sweden wait to join the European Monetary Union (EMU) until its economy recovered from the 1990s crisis. Sweden chose to stay out of the eurozone when it started in 1999, and a 2003 referendum saw 55.9% of voters reject euro membership.

A new report commissioned by the Stiftelsen Fritt Näringsliv, and again led by Calmfors, highlights advantages such as increased trade and foreign direct investment, estimated to rise by 5-7.5%, due to reduced currency exchange risks within the eurozone. The report points out that economic synchronization between Sweden and the eurozone has improved, diminishing earlier concerns over instability. It also notes that the euro has significantly boosted intra-European trade.

While adopting the euro would mean giving up Sweden's independent monetary policy, the report suggests it could enhance Sweden’s fiscal flexibility during economic downturns and strengthen the country’s political influence within the European Union's economic framework. However, it cautions about the risks associated with potential financial obligations arising from eurozone crises.

Calmfors emphasizes that joining the euro would signal Sweden’s commitment to deeper European political cohesion amid growing geopolitical challenges. The debate coincides with broader economic concerns, such as criticism from LO economist Torbjörn Hållö, who warns against overestimating economic success abroad, like in the US, which could misguide Sweden's economic policies.

As discussions advance, Sweden's decision on euro membership will weigh the promise of greater economic integration and political influence against the risks linked to eurozone financial responsibilities.