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Sweden Travel Guide
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A bursting real estate bubble caused by inadequate controls on lending combined with an international recession and a policy switch from anti-unemployment policies to anti-inflationary policies resulted in a fiscal crisis in the early 1990s. Sweden's GDP declined by around 5%. In 1992, there was a run on the currency, the central bank briefly jacking up interest to 500% in an unsuccessful effort to defend the currency's fixed exchange rate. Total employment fell by almost 10% during the crisis. The response of the government was to cut spending and institute a multitude of reforms to improve Sweden's competitiveness, among them reducing the welfare state and privatizing public services and goods. Much of the political establishment promoted EU membership, and the Swedish referendum passed by 52–48% in favour of joining the EU on 13 November 1994. Sweden joined the European Union on 1 January 1995.

During the Cold War, Europe's non-aligned Western countries, except the Republic of Ireland, had considered membership unwise, as the EU predecessor, the European Community, had been strongly associated with NATO countries. Following the end of the Cold War, however, Sweden, Austria and Finland joined, though in Sweden's case without adopting the euro. Sweden remains non-aligned militarily, although it participates in some joint military exercises with NATO and some other countries, in addition to extensive cooperation with other European countries in the area of defence technology and defence industry. Among others, Swedish companies export weapons that are used by the American military in Iraq. Sweden also has a long history of participating in international military operations, including most recently, Afghanistan, where Swedish troops are under NATO command, and in EU sponsored peacekeeping operations in UN protectorate Kosovo, Bosnia and Herzegovina, and Cyprus.

Source: Wikipedia Encyclopedia

 



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