Extract A: Balance of Sweden Trade, March 2023 to March 2024
| Month | Goods balance (SEKbn) | Services balance (SEKbn) | Total trade balance (SEKbn) |
|---|---|---|---|
| Mar 2023 | -5.0 | 2.2 | -2.8 |
| Apr 2023 | -5.2 | 2.1 | -3.1 |
| May 2023 | -5.8 | 2.3 | -3.5 |
| Jun 2023 | -6.0 | 2.2 | -3.8 |
| Jul 2023 | -6.5 | 2.0 | -4.5 |
| Aug 2023 | -7.2 | 2.2 | -5.0 |
| Sep 2023 | -7.5 | 2.3 | -5.2 |
| Oct 2023 | -8.0 | 2.1 | -5.9 |
| Nov 2023 | -8.2 | 2.4 | -5.8 |
| Dec 2023 | -8.5 | 2.2 | -6.3 |
| Jan 2024 | -9.0 | 2.3 | -6.7 |
| Feb 2024 | -8.8 | 2.2 | -6.6 |
| Mar 2024 | -9.2 | 2.4 | -6.8 |
Extract B: Sweden's Trade Obstacles
In March 2024, Sweden's trade deficit with the global market continued its steady expansion. High energy costs and import prices for industrial machinery inflated the import bill, whilst exports of vehicles and timber failed to gain substantial traction despite a sustained depreciation of the Swedish Krona (SEK). The goods deficit expanded to SEK 9.2bn.
The persistent deterioration in Sweden's trade balance suggests that the 12% depreciation of the SEK since early 2023 has not succeeded in boosting export competitiveness. An industrial analyst noted, "Although a weaker SEK theoretically makes Swedish engineering and forestry products cheaper abroad, global economic slowdowns have suppressed export demand. Meanwhile, inelastic demand for critical components and energy imports means the import bill has ballooned."
Extract B describes Sweden's trade performance as 'disappointing'. Explain how the data in Extract A show that Sweden's trade performance has been 'disappointing' given the fall in the value of the Swedish Krona (SEK) since March 2023.
