September 7, 2018 / 7:07 PM / 2 months ago

Breakingviews - Sweden election shows it’s not the economy, stupid

Swedish Prime Minister Stefan Lofven addresses a news conference after talks with German Chancellor Angela Merkel at the chancellery in Berlin, Germany, March 16, 2018. REUTERS/Hannibal Hanschke

LONDON (Reuters Breakingviews) - An exhortation to focus on “the economy, stupid” is often credited for helping Bill Clinton win the U.S. presidency in 1992. That approach will not work for mainstream politicians in Sweden, which holds an election on Sunday.

Support has surged for Sweden Democrats, an anti-immigration party which according to some polls now has the backing of almost a fifth of voters. Mainstream rivals insist they will have nothing to do with it. But forming a stable coalition may be difficult, as Sweden Democrats has promised to bring down any government that fails to give it a say over immigration policy.

In the United States and United Kingdom, economists have pointed to the decline of blue-collar jobs and marked income inequality as factors that contributed to political upheaval. Sweden is different. The country is growing faster than the European Union a whole, as it has for much of the past two decades, and has one of the lowest levels of inequality in the bloc, as measured by the Gini coefficient. The employment rate has risen to above 77 percent, nearly 10 percentage points higher than for the EU. The Nordic country has run budget surpluses since 2015 and is expected by the European Commission to do so again this year and next.

Concern about immigration has, however, climbed up the political agenda since 2015, when hundreds of thousands of people fleeing war in Syria arrived in the EU. That year, the number of asylum seekers in Sweden jumped to 162,877 double the tally for 2014 and nine times higher than a decade earlier. More than a fifth were unaccompanied minors that year,10 times more than in 2005.

True, not all those who claimed asylum were accepted and refugee numbers have since fallen back. Still, nearly 19 percent of Sweden’s population of 10.1 million was born outside the country by 2017, up from 11 percent in 2000.

As in other EU countries, the growing popularity of the Sweden Democrats has forced mainstream parties to shift their stance on immigration. Sweden has imposed curbs on asylum seekers and the governing Social Democrats proposed barring firms from offering work to non-EU nationals unless they belong to sectors that are classified as suffering from staff shortages. Sweden Democrats will shape policy even outside government - despite the economy.

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