Stockholm Chamber of Commerce - This Is How Stockholm Will Become the Best Capital in Europe

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This Is How Stockholm Will Become the Best Capital in Europe

The cities' growing role as greenhouses for new ideas and innovation is one of the strongest global megatrends. For the next government, like new municipal and regional governments in the metropolitan area, it is crucial to act on the basis of the changes that take place in the wake of this mega trend.

If nothing happens or conditions deteriorate, the job risk will be reduced, competitiveness weakened and prosperity over time curtailed. After several years of good growth, there are now signs that the economy may be entering a weaker period. The past two term periods have reforms for the future in great light with their absence - regardless of government colour (red or blue). When the economy turns down and monetary policy is normalized, Sweden's reform debt will become clear. Until then, the transformational shift, such as digitization and robotization, along with artificial intelligence, quantum computers and block-chain technology, is where development is in its infancy but will accelerate. Now, courageous reforms are needed again. These must combine environmentally sustainable growth with a continuous improvement in the business environment and human capital through research and education efforts. And they must not be delimited to the most acute problems, however must focus on five features that characterize success in the modern economy.

1. Mobility. The opportunity for people to find and change jobs or housing is central to the development of people and companies. Yet almost 600,000 people are in rental queues in Stockholm County, while one-fifth of the Stockholm companies state that they have failed to recruit due to the housing situation. The next government - and the next opposition - has a responsibility to ensure a cross-border agreement that essentially improves the housing market. Moving costs must be reduced and robust construction is ensured. It can only be achieved if you take a comprehensive approach to finance, taxation, rent-fixing, land policy and support for resource-poor households. All parties will have to kill sacred cows. 

2. Accessibility. Successful regions are accessible regions. Stockholm is the fastest growing capital in the EU. By 2050, 3.4 million people are expected to live in Stockholm County, 50 percent more than today. Already now, congested streets stop bus traffic as well as goods deliveries. The commuter and subway trains are crowded. It is not fast and easy to travel between the northern and southern parts of the metropolitan area. In order for the capital region to continue to grow, smart investments in infrastructure are needed. Building four railways throughout Stockholm between Stockholm and Uppsala should take place faster than is currently planned. The last quarter of the ring road around Stockholm must be completed as soon as possible - and it can and should be done to minimize negative climate effects.

3. Availability. Research points out that aviation is important for both the knowledge-intensive service sector and the manufacturing industry outside the major cities. Therefore, the metropolitan area must become more accessible and connected with the rest of the world and with the outside world. Arlanda must be upgraded and equipped for expansion with new landing lanes as well as the possibility of issuing US entry permits, such as preclearance. Both the Government and regions must promote more direct routes to strategically important international markets. Aviation tax should be abolished as it stands in the way of the capital region's accessibility without benefiting the climate. Instead, try to promote new technologies and to achieve a large-scale Swedish production of biofuels. Aviation can and must be sustainable.

4. Attractive. An attractive metropolitan region requires a good and sustainable climate - for the environment, for culture, for family life and for entrepreneurs. Europe's premier metropolitan area must be attractive to global talents, headquarters and international investment. The highly skilled migrant deportations of recent years do not only harm individuals and their families, but also company’s ability to recruit. They are a shame and must be stopped. But it's not enough. Introducing a talent visa for graduates from the world's top 100 universities and for entrepreneurs who are offered the opportunity to work at a Swedish incubator or accelerator. The next government should immediately improve the system that reduces the cost of companies hiring foreign experts by extending, for example, the period from three to at least five years. Attractiveness is also about offering residents welfare services with high availability and quality. Furthermore, the region should become more attractive as a place for cutting-edge research by attracting a top foreign university.

5. Security. The proportion of companies in Sweden affected by crime and vandalism is 40 percent, compared to 25 percent in the OECD as a whole. According to a survey conducted by Demoskop, one third of the entrepreneurs in areas of high exclusion are heavily exposed to crime. As many people demand more police presence. In order to reverse the negative development, there must be locally anchored and visible police officers in each area, and, if necessary, municipal security guards. The next government must dare to think new to address the falling schools in many vulnerable areas. In recent years, it is clear that money on its own is rarely the solution for the school.

The capital city of Stockholm-Uppsala competes with some of the world's most successful and creative metropolitan regions. We have good opportunities to climb the gold pallet as Europe's best metropolitan area. But global competition is crisp and therefore bold reforms are needed that strengthen - not weaken - the capital region as the role of Sweden's job engine. In this way, Sweden's long-term competitiveness and prosperity are improved.

Andreas Hatzigeorgiou, fil.dr

CEO, Stockholm Chamber of Commerce

This article was translated from Dagens Industri, read the whole article (in Swedish).