PARIS — Swedish voters overwhelmingly rejected the euro as the nation's currency in a referendum on Sunday (Sept. 14). Only the Stockholm region and Skane in the south, where high tech and telecommunication industries are concentrated, voted in favor of the measure.
The vote rejecting the European single currency is a blow to those in Sweden seeking greater foreign investment and trade with multinational companies.
The pro-euro campaign, lead by executives like Carl-Henric Svanberg, the head of the Swedish telecommunications giant Ericsson, cautioned that Sweden could face a huge drop in investment by multinational companies if the country voted against the euro. Svanberg also warned that an international companies like Ericsson might redirect investments to areas where there are fewer currency exchange risks.
With the rejection, the Oresund region, Scandinavia's largest IT cluster consisting of Great Copenhagen in Denmark and Skane region in southern Sweden will for example find themselves unexpectedly turning their backs to its ultimate goal: economic and technology integration into a single currency.
Apart from Sweden, Denmark and England are currently outside the 12 country euro zone, stretching from the Arctic Circle to the Mediterranean. Denmark rejected the single currency three years ago. The Swedish government said it would not hold another vote on joining the euro for ten years.
Euro backers attempted to donwplay the rejection. Pia Gideon, vice president of Ericsson, said the company sees no dramatic changes in its business despite rejection of the euro. "On a long term, we are convinced that Euro should stimulate the growth and investment in Europe," she added.
Gideon said Ericsson, which operates in 150 countries, has no plans to move out of Sweden. As for future operations, "As a company, we need to find a way to minimize our risk," she said. Such risks include operating in countries where the economy depends on a small currency like the Swedish krona, she said.
Mats Engelmark, senior manager of IT/Telecom at state-run Invest in Sweden Agency (ISA), said 68 percent of international companies based in Sweden responded in a recent survey that they would not suffer from rejection of the euro. Meanwhile, 29 percent of the international companies said their business would decrease if Sweden rejected the euro. The ISA surveyed 200 to 300 foreign-owned companies with more than 50 employees in Sweden.
"How this affects your business depends on types of operations and sectors your business is in," Engelmark said. "If your main focus was in competence in research and development in IT or biotech industry, there will be less impact."
As for foreign investment in Sweden, Engelmark acknowledged, "If all things were equal, the deal could go to other countries where their economy is integrated [with the] euro."
