
Swedish Central Bank chief warns on continued threats
Lars Nyberg, deputy governor of the Swedish Central Bank, said the Swedish economy is not out of danger, in his keynote speech at the unquote” Nordic Private Equity Congress 2010. Viktor Lundvall reports.
Unlike many countries in the rest of Europe, Sweden showed early signs of recovery from the financial crisis, with Nyberg predicting a return to positive growth in 2010.
However, he stressed Sweden is not yet out of danger, outlining three obstacles to financial stability:
Firstly, the situation in the South European countries, especially Greece, is having a major impact on the Eurozone and the world economy. It continues to pose a threat to recovery in the region, both for countries in the EU and their close neighbours.
Secondly, the state of the Baltic economies was outlined as a concern by Nyberg. With Nordic banks such as Swedbank, SEB and Nordea active in the Baltic countries, the recent turmoil has led to major capital losses for the banks in these regions. Against expectations, the Baltic countries have managed internal devaluations successfully, and capital losses have now been eradicated, but the situation remains delicate.
Lastly, though many believe there is a housing bubble risk in the region, Nyberg did not believe this was the case, at least not in Sweden.
Despite these hurdles, the general feeling from Nyberg's speech was that Sweden is looking in good shape to recover from the crisis. This was also supported by evidence of economic performance and forecasts showing strong growth and low debt relative to other European countries.
Nyberg also briefly touched on the issue of the AIFM Directive, something that was high on the agenda for the conference's attendees. He believes the proposed directive looks better than it did in its original draft, but needs refining and urged continued talks on the matter.
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