How it All Began
Sweden is considered as the largest of the five Nordic countries and forms part of Scandinavia in northwestern Europe. It is considered to be poor in agricultural resources, thus it started trading with Russia and southeastern Europe during the 9th to 11th centuries. During the Middle Ages, its trade expanded with other parts of Europe and Gotland became the center of the Baltic Sea trade in fish, metal and timber. In the 15th century, the iron ores of Berslagen were being smelted with charcoal from the surrounding forest. Between the 17th and 18th centuries, Sweden was regarded as Europe's foremost producer of high quality steel. Lumbering was on a large-scale basis in the 19th century.
Iron and ore production had significantly dropped recently. However, it is still considered as an important industry in Sweden making the country a major exporter of iron. The most important mining areas are situated at Gallivare and Kiruna. Lower-grade nonphosphoric iron ores are seen in Berslagen. The country also produces copper, arsenic, lead and silver which comes from Skelletftea field.
Metalworking establishments employ half of the people in the manufacturing industry. Eskilstuna is known for its high-quality steels and Sweden exports the likes of Volvo and Saab automobiles. The nation is also famous for its ball bearings, high-voltage cable, electric and telephone equipment and electrical appliances. Sweden's shipbuilding industry ranks second in the world. Chemicals and petrochemicals are also of importance.
Agriculture is highly-mechanized. Three-fourths of all farm income is derived from livestock and dairy products. The most cultivated crops include wheat, barley, oats and hay and all of these are grown primarily for fodder. Rye, sugar beets as well as potatoes are also cultivated in the area.
About half of Sweden's trade is with members of the European Community (EC). But in the light of international trade, Sweden has remained outside this community. The government found it more necessary to be independent from the EC in order to establish good trade relations with other parts of the world, thus the beginning of fruitful trade with the United States. To these days, the US had help build a strong economy for Sweden while the latter admits of having the former represent most of the foreign companies in their land.
Major Imports and Exports between the Two Nations
The major imports of Sweden are comprised of machinery and automobiles, petroleum, textile fibers and foodstuff. On the other hand, its major exports are machinery and automobiles, wood pulp, paper and wood and iron ore. The amount of US exports to Sweden amounted to $3.46 billion for the period ending August 2008. Imports coming from Sweden to US were tallied at $8.52 billion. These facts came from the US Census Bureau. For the year 2007, the following products were seen to flourish in the business relations of these two countries:
Income Tax Treaty between US and Sweden
- Swedish Exports to US. Out of the $13.05 billion amount of goods which came from Sweden to US in 2007, new and used passenger cars ranked first amounting to $2.36 billion equivalent to 18% of the total. Included in the top ten are: medicinal, dental and pharmaceutical preparations; iron and steel mill products-semifinished; other industrial machinery; other scientific, medicinal and hospital equipment; telecommunications equipment; alcoholic beverages except wine and other related products; other petroleum products; photo and service industry machinery and trade tools; and materials handling equipment. The latter gained an income of $344.92 million or 2.6% of the year's total.
- Swedish Imports from US. The imports of Sweden from US totaled to $4.49 billion in 2007. Of this amount, $427 million or an equivalent of 9.5% went to other household goods. Other notable products on the list are: semiconductors; telecommunications equipment; minimum value shipments; other parts and accessories of vehicles; medicinal equipment; civilian aircraft; new and used passenger cars; industrial engines; and other industrial machines. Other industrial machines gained a total income of $113.62 million or 2.5% of the year's total.
- Fastest-Growing US Exports to Sweden. The year 2007 was still an evidence of good trade relations between these two countries. In fact there were commendable products which increased its sales from 2006. On top of the list is nursery stock which earned $101 thousand equivalent to an increase of 3,367%. It was followed by other items such as: sports apparel and gear; hair waste materials; nuclear fuel materials; and oilseeds and food oils. The last product gained for itself a total of $1.16 million which is equivalent to an increase of 454% from 2006.
- Fastest-Growing US Imports from Sweden. Swedish exports to US were remarkable as well. As evidence to this, some of these goods were tracked to be making good in terms of sales. From 2006, liquefied petroleum gas was recorded to have a sales increase equivalent to 22,044% or $220.44 million. Other products on the list were: cotton, wool and other natural fibers; gem diamonds-uncut and unset; vegetable and preparations; complete and assembled goods. For the last product, it had $2.44 billion equivalent to 661% increase from 2006.
This amended treaty was signed between the US and Sweden on September 30, 2005. This was an agreement which basically evolves on the aspects of double taxation as well as the prevention of financial evasion when it comes to income tax. The original treaty was signed on September 1, 1994. The following were the provisions found in this agreement:
Trade Conflicts between the Two Nations
- On Income Tax. The United States was allowed to tax previous US citizens who have lost citizenship due to tax evasion. The provision was extended to tax those who have financially evaded the obligation 10 years from the loss of the citizenship. Certain thresholds were established to form part of the basis for taxation such as: average annual net income of the citizen five years before he loss his citizenship to tax evasion; or the net worth of that person as of the date he lost his status.
- Swedish Taxes. Specifically, these taxes refer to national income tax, tax on dividends, non-resident income tax, income tax of non-resident athletes and artistes, national capital tax, excise tax on insurance premiums paid to foreign insurers and municipal income tax.
- Taxes on Residents. This term actually refers to both US and Swedish citizens who are subject to tax of either area because of residence, citizenship, place of work or management and place of incorporation. This may also refer to entities which are subject to tax nominally but are not required to pay their obligations.
All of the above-mentioned aspects were discussed in the treaty in order to redound to the benefits that both sides could have. These things were not construed just to make profit from each other. This was helpful in retaining their stand in world economy.
Trade relations between the United States and Sweden were partially affected by issues on standing in world trade. There was this kind of struggle to gain top ranks on some economic aspects of international business. The humanitarian aid concept led to some disputes.
On this aspect, Sweden ranks on top of the charts whereas the US was found at the number 16 spot. Sweden was assessed to have delivered funds quickly for this purpose coupled with some sort of speedy follow-ups as to whether the amount reaches their targets. The United States, on the other hand was good on delivering goods but not cash. It was also said that the latter failed to ratify vital aspects of international treaties on human rights.
Future Trade between the US and Sweden
The US and Sweden may have been affected by the above rankings especially that US has always established itself on top of the charts. However, this was just a mere contributory factor that did not really hinder their trade at all. They used it as a stepping stone to continue their work side by side. They have taken it as a chance to get back and focus to countries which need both their aids.
They have left the humanitarian issues behind and allowed other organizations to assess this matter. As of the moment, both countries are busy looking forward to better future trade relations. Basically, they are more attentive on concerns about education. They want to be assured that their children and their children's children will benefit from the core concepts of learning. This probably, is the most ideal thought any country could have.
The fruits of their labor are founded on their trade relations as well as their global business standings. It is not really a question of who ranks before the other. It is more of concentrating on how to improve the status and lives of the people. More notes are better yet concentrated on how to build these strong economies in the light that all other people could reap the benefits.
US-Sweden Trade References