Navigating the Swedish Council Presidency 

On 1 January this year, Sweden assumed the rotating Presidency of the Council of the EU for a period of six months. As expected, Sweden is staying true to its “honest broker” reputation, though this time it seems to be more out of necessity than choice.  

The Swedish Government faces a difficult economic and political situation at home, with NATO admission still just out of reach and a difficult political partner to manage in the form of the far-right Sweden Democrats.  

The result has been to shy away from concrete commitments at EU level, a move that raises the stakes for the incoming Spanish Presidency to clear the EU’s significant legislative in-tray ahead of the 2024 European elections. 

Priorities: everything, everywhere?  

On paper, the Swedish Government has set itself relatively modest goals for its Presidency of the Council of the EU (January-June 2023), which will see it set the agenda and the pace of work in Brussels. Its programme lists four headline commitments: security, green/energy transition, rule of law and improving EU competitiveness.  

This last one is essentially an unreserved commitment to defending free trade and competition. It has formed the core of Prime Minister Ulf Kristersson’s pitch of the Presidency domestically, and indicates Sweden may wish to weigh in to counter the more protectionist tones coming out of France (and, increasingly, the European Commission) in response to the Inflation Reduction Act.  

However, looking beyond, Stockholm has struggled to formulate concrete priorities on ongoing EU legislation, which is after all the main prerogative of a Council Presidency. Sweden’s strategy for the multitude of open EU initiatives in its in-tray seems to be to commit to progress them all as much as possible, but to refrain from committing to any specific milestones. In most of their inaugural working-level meetings held this month, Swedish officials seem to have stuck to listing current files rather than naming them in any particular order. 

In doing so, Sweden is certainly living up to its reputation of taking the role of the Presidency as “honest broker” seriously, suppressing national priorities to seek consensus. The resulting “everything, everywhere” approach means that any progress on legislation will depend more on the dynamic of individual negotiations than on any steer from Swedish officials, bar perhaps a few items gaining political momentum like the EU Chips Act or the European Media Freedom Act.  

On the flipside, this will likely leave Sweden’s successor Spain with a large in-tray of files to finalise during the latter half of 2023. With only a year to go until the 2024 European elections, this could put lower-profile proposals at risk of lapsing, something companies awaiting any urgently-needed sectoral legislation will wish to stress to both countries’ governments. 

Uncertainties at home

Sweden’s hesitation to commit to firm deadlines also reflects domestic policy considerations. Kristersson’s coalition Government, which just celebrated its first 100 days in office, is split on a number of core issues, including on economic and fiscal policy in the face of the cost-of-living crisis. The Government struggled to deliver on subsidies to soaring energy costs before Christmas, particularly in the rural North, which has damaged its popularity. 

In addition, most of the new Ministers lack experience at EU level, and chairing Council meetings will be a first for many, including for EU Affairs Minister, Jessika Roswall. This may make them more prone to opt for the “honest broker” approach, whether out of caution or to prevent “state secretaries”, the top officials in Swedish ministries, from taking initiatives of their own. State secretaries are political appointees and often keen to leave their own political mark on files. 

In fairness, the Government’s top priority is also unrelated to EU policy. NATO accession has become an existential question for Kristersson, whose Moderate party has advocated for accession for years. Turkey’s refusal to ratify Sweden’s accession, compounded by recent provocative demonstrations in Stockholm, has left the country stuck on NATO’s doorstep, having committed to the alliance but not yet receiving its full protection. Kristersson will now cling to the hope that President Erdoğan does indeed relent following the Turkish general election in May. Until then, managing relationships with Turkey, the US and Finland will be his most pressing concern. 

Kristersson also has to manage the expectations of the far-right Sweden Democrats, currently Sweden’s second-largest party, who props up his government through a confidence-and-supply agreement. Progress without agreement on key EU files can at least help Kristersson ensure that the Sweden Democrats are not tempted to vent their EU-scepticism at home, as opposed to their opinion of President Erdoğan, whom the party publicly calls an “Islamist dictator”. 

The far-right’s muted influence  

The Sweden Democrats underpinning the current Government marks the pinnacle of far-right influence on Swedish politics in modern history. When the party first entered Parliament in 2010, they were shunned by all other parties and treated as nationalist pariahs. Twelve years later, this “cordon sanitaire” has dissolved, with pushback from the small, centre-right Liberals being the only obstacles to the Sweden Democrats joining the Government outright.  

Despite their important role in domestic policy, we expect the influence of the Sweden Democrats on Sweden’s EU policy to be limited. The Government’s agreement with the far-right limits their direct influence to some specific files, mostly relating to immigration, climate and energy. While some far-right MPs have indicated their willingness to expand their say to further areas, this could jeopardise the Government’s slim majority in Parliament, and long-time party leader Jimmie Åkesson has vowed to stick to the letter of the agreement. 

This limited, but direct, influence still enables the Sweden Democrats to make EU-level negotiations on important issues like the Migration Pact, energy subsidies and rule of law mechanisms more difficult as they exert pressure on the Swedish Presidency to take on a more partisan national stance. The Presidency was barely a few days old when Sweden’s EU Ambassador, Lars Danielsson,  announced that he would not be able to secure a deal on the Migration Pact. Looking further ahead, it remains to be seen how the Sweden Democrats would respond to an escalation of the rule-of-law disputes with Hungary and Poland – countries which the party is friendly with.  

All told, the uncertainty around the role of the Sweden Democrats should not distract from the real opportunities stemming from Sweden’s “honest broker” approach to their Council Presidency. With competitiveness as a flagship goal, and a number of open EU initiatives in areas including financial services, sustainability and pharmaceuticals, input from interested stakeholders can be pivotal in determining which files are given a boost by Stockholm, and which ones are left to wait their turn.   

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