Why Sweden, once one of Beijing’s most outspoken critics in Europe, has changed its tune

Millions of Swedish voters head to the polls on Sunday to elect a new parliament. Whatever the outcome, analysts say, the country is likely to look more towards Beijing for its technology edge and to diversify away from an increasingly unreliable Washington, despite persisting challenges in China-EU trade. “Many factors right now suggest that relations between Sweden and China will change in the long term – not necessarily directly linked to the elections – because I see more Swedish businesses [realising] that they rely on Chinese technology for their competitiveness,” said Paulo Silva, founding partner of New Republic Public Affairs and a former adviser at the Swedish Finance Ministry. The increasingly uncertain geopolitical environment was also likely to push Swedish political leaders and the business community to be more pragmatic and diversify, he said. The US under the Trump administration was increasingly being seen as a real threat, according to Silva, citing episodes such as his demand to annex Greenland, a self-governing territory of Denmark, which has close ties to Stockholm. In Gothenburg, they sort of looked at it and said, ‘China is one of the good guys, because they provide job opportunities’ Niklas Swanstrom, Institute for Security and Development Policy The percentage of Swedes holding a positive view of the US collapsed to 19 per cent in 2026 from 55 per cent in 2023, while those holding a positive view of China increased to 27 per cent from 12 per cent during the same period, according to a Pew Research report published in July. Meanwhile, the rise of far-right nationalist political forces in Germany and France, the two core European Union states, has raised concerns about the bloc’s future. “There are worries in the business community here. What does it mean? Because Germany is the most important market for Sweden … will we have the European Union and the internal market as we have had now?” Silva said. On the official front, ties between Sweden – once one of Beijing’s most outspoken critics in Europe – and China have warmed in recent months after years of strain. Ties soured in the late 2010s over Beijing’s detention of Hong Kong bookseller Gui Minhai, a Chinese-born Swedish citizen. Gui Congyou, China’s ambassador to Sweden from 2017 to 2021 who is seen as one of Beijing’s best-known “wolf warrior” diplomats, added to the friction. Sweden eventually gained visa-free access to China last November – the only two other EU countries excluded are Lithuania and the Czech Republic, both of which have clashed with Beijing over Taiwan – and Chinese Foreign Minister Wang Yi visited Sweden in July, becoming the first Chinese foreign chief to visit the country in more than 20 years. “Sweden’s attitude towards Chinese companies is warming up,” said a senior Chinese executive in Sweden, who chose to remain anonymous to speak freely. During Wang’s visit, he met with Jacob Wallenberg, a leading member of the Wallenberg family that wields considerable influence over Swedish business – a positive signal, the executive said. Compared to countries like Germany, which has turned more defensive in the face of a widening trade deficit with China, Sweden was also better shielded, analysts said. “We do not compete necessarily on the same terms with China as the Germans do … the economic impact is greater on Germany,” said Niklas Swanstrom, director of the Institute for Security and Development Policy in Stockholm. Sweden’s steel companies produce niche, green steels that compete in different markets than Chinese steel, and Volvo Cars – Sweden’s automotive crown jewel – is owned by Chinese group Geely, which has been praised for its stewardship. “In Gothenburg, they sort of looked at it and said, ‘China is one of the good guys, because they provide job opportunities’,” Swanstrom said. Nevertheless, challenges remained for future economic ties, as Sweden needed to align with EU trade policy and politicians increasingly focused on security concerns in Chinese activities, according to Frederic Cho, vice-chairman of the Sweden-China Trade Council. “There’s a discrepancy between what politicians say and what the business world wants and expects the government to help them with,” he said. Cho added that Beijing’s stance on Russia’s invasion of Ukraine had led politicians to view China increasingly through a security lens, a concern he said was felt more sharply in Sweden than in southern Europe for geographical and historical reasons. Sweden has also passed “one of the most stringent” foreign direct investment regimes in Europe in recent years, according to Cho, making Chinese investments in certain sectors challenging. Pressure from Chinese competition is also playing into Sweden’s domestic debates. The next major round of wage talks begins at the turn of the year, with industry negotiating first and setting the benchmark for the rest of the labour market. The Confederation of Swedish Enterprise argued in an April report on the second China shock that “the assessment of the scope for wage increases ahead of 2027 needs to take greater account of global competitive pressure and the value of a stable, internationally competitive industry.”

Why Sweden, once one of Beijing’s most outspoken critics in Europe, has changed its tune

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Driven by geopolitical shifts and critical industrial needs, Stockholm is expected to pivot towards Beijing to shield its economic future

Driven by geopolitical shifts and critical industrial needs, Stockholm is expected to pivot towards Beijing to shield its economic future