Photo: Ali Lorestani / Reuters
The Swedish company reported income in the second quarter, well above market expectations. Despite scathing predictions of critics who predicted the collapse of the economy, the Swedish business has avoided mass bankruptcies, the Financial Times writes.
“I have never seen such a high proportion of companies that reported a much larger profit than expected. It’s almost every company”, — said Asbjorn Lundevall, an analyst at Swedish Bank SEB. From Telecom giant Ericsson to the home appliance manufacturer Electrolux — company show good results, even if in some cases it is not so strong a fall as analysts had feared. It was the result of Sweden’s refusal from quarantine, the newspaper writes.
One of the country’s largest banks, Swedbank reported a profit in the second quarter of 6 billion kroons (683 million dollars), which is slightly less compared to the same period last year, but nearly 40 percent ahead of analysts ‘ expectations. Large companies that in the beginning of the crisis rushed to Swedbank for new loans began to repay them, while small businesses are not occupied as much as expected.
However, the Swedish companies are divided into those focused on the domestic market and for export. The first will benefit the most from a lack of quarantine, the second is more affected by the reduction in global demand. Martin Lundstedt, CEO of Volvo, said the drop in sales of 38 per cent was “unprecedented.”
Economists predict that Sweden’s GDP will decline this year by about 5 percent, which is comparable to Norway and Denmark, but much better than Italy, UK or France.
The Swedish government decided early on not to impose strict restrictive measures due to pandemic coronavirus. The country did not forbid the work of public institutions and travel abroad. This has resulted in a higher incidence compared to other countries in the region. The authorities explained their actions by the desire to save the economy.
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