Swedish Slump

According to the Financial Times, Sweden in cutting its famously generous welfare benefits due to a long-slumping economy.

The weak international economy and uncertainty caused by war in Iraq has hit the country's biggest exporters, with companies such as Ericsson, Electrolux and SAS shedding thousands of jobs.

At the same time, public finances have been hit by dwindling tax receipts and soaring levels of sick leave. The surplus in the public finances is forecast to shrink to 0.4 per cent of gross domestic product this year, more pessimistic than the European Commission's estimate of 0.8 per cent. Central government will post a SKr21bn deficit, the first shortfall since 1997.

[Link courtesy of Free-Market.Net]