Sweden's Riksbank published a Staff Memo analysing Sweden’s exposure to recently raised US import tariffs through direct exports and global value chains. The memo concludes that the direct effects of tariffs at their current level should be relatively limited for Swedish exports to the United States and for Swedish GDP growth, while uncertainty over future trade policy could generate larger indirect effects via weaker global demand. The analysis notes US tariffs of 25 per cent on steel and aluminium products and on cars and car parts, alongside a general 10 per cent tariff on other goods. It highlights the United States as Sweden’s third largest destination for goods exports and the largest for services, with goods exports of SEK 187 billion (2.9 per cent of GDP) in 2024 and services exports equivalent to around 2.5 per cent of GDP. Using OECD Trade in Value Added data, direct exports of Swedish value added to the United States were equivalent to 2.2 per cent of GDP in 2019, with indirect exports via third countries of 1 per cent of GDP, meaning around one third of Swedish value added destined for the US market was exported indirectly. The most exposed sectors include motor vehicles, pharmaceuticals and machinery, although their combined direct exports to the United States were 0.7 per cent of Swedish value added in 2019 and a large share of pharmaceutical exports consists of services that are not subject to tariffs. About 2.1 per cent of Swedish employment was directly or indirectly linked to production for export to the United States in 2019, rising to almost 9 per cent within manufacturing. The memo notes that the general tariff rate was expected to apply until 8 July unless the US and EU reached an agreement, with tariffs on imports from the EU then set to rise further, including a plan presented by the US President for a 50 per cent tariff from 9 July if no agreement was reached. It also points to ongoing US investigations into imports of pharmaceuticals and of timber and wood products that could lead to additional tariffs.
Riksbank 2025-05-30
Sweden's Riksbank Staff Memo finds current US import tariffs have limited direct impact on Swedish exports and GDP growth
Sweden's Riksbank released a Staff Memo assessing the impact of US import tariffs on Swedish exports and GDP growth. The memo finds limited direct effects from current tariffs but warns of potential larger indirect impacts due to global demand uncertainty. Key sectors affected include motor vehicles, pharmaceuticals, and machinery, with significant indirect exports to the US market.