From Trade War to War – Swedish Exporters Have Learned to Weather the Storm

A year ago, the conversation was about tariffs and a “new normal”. Since then, the US and Israel have attacked Iran, oil markets have been thrown into turmoil, and wars and global uncertainty continue. Even so, trade keeps growing. The reason, says Stefan Karlsson, Chief Economist at the Swedish Export Credit Agency (EKN), is that companies have become remarkably good at adapting.

“If there is a new normal, it’s that there are always several disruptions going on. It has been like that throughout the 2020s,” Karlsson says.

He points to the pandemic, Russia’s invasion of Ukraine, the change of president in the US and Trump’s tariffs, and most recently the US–Israeli attack on Iran on 28 February, which has hit energy markets and oil in particular. “Something new seems to come along every year that affects companies, banks and households.”

Hardened by crisis

There is a silver lining, Karlsson says. “Economic actors, from countries down to individual companies, have been hardened by this. You steel yourself and build the ability to adapt to new circumstances, something that has been going on since the days of the pandemic.”

The figures back him up. Global goods trade grew by around 4.5 percent in volume in 2025. “That’s quite impressive considering the tariffs and everything else happening in the world,” he says. The World Trade Organization (WTO) expects growth of around 2 percent at the end of 2026 and 2.5 percent in 2027.

For tech and service companies, the picture is brighter still. WTO’s forecast for 2026 is that trade in services will grow by 4.8 percent and for 2027 by 5.1 percent. Much of that is driven by digitally delivered services, financial and insurance services, and tourism.

Does it surprise him? “Yes. Apart from some short dips, it looks surprisingly good, Karlsson says.”

Exports to the US bounce back

Swedish goods exports to the US fell by around 9 percent last year, and 2026 started badly. In January and February, exports to the US were down 17 percent compared with the same period in 2025. But by midyear, the decline had narrowed to 7 percent.

“It’s impressive in itself that it hasn’t fallen more,” Karlsson says. “It’s another example of what I said at the start: companies are quite good at adapting to new circumstances and finding solutions.”

And the bill has landed on the US itself. Karlsson cites figures from the Federal Reserve Bank of New York showing that American importers and consumers have absorbed around 90 percent of the tariff costs. “That’s not in line with what President Trump has claimed, that foreign exporters would take the cost. In reality it’s exactly the opposite, which is also what all theory says.”

The krona turns

In 2025, the strong Swedish krona (SEK) ate much of exporters’ gains. The value of Swedish exports rose by only around 1 percent, while volumes grew by about 4 percent. This year the tide has turned. Since the new year, the krona has weakened by just over 7 percent against the dollar and about 4 percent against the euro.

“Now it’s just a matter of time before it’s 10 SEK to the dollar again, because nothing substantial has happened in the Swedish economy that points to a strengthening,” Karlsson says. “We’re more or less back to normal, and exporters are getting a bit of a tailwind from a ‘weaker’ krona.”

The US remains a must

Despite tariffs and political unpredictability, Karlsson sees no alternative to the US for Nordic tech companies with global ambitions.

“The US is leading in new technology, above all in AI. Sure, China is there competing, but the situation there is different. The US still attracts more companies, talent and investment. It’s a bit in the country’s DNA. As a growing European company, you can’t look past the US if you want to be successful.”

Asia lags – Europe matters most

Asia is a more worrying story. Swedish goods exports to the region fell, accounting for just over 8 percent of the total in the first half of the year. Europe accounts for around 75 percent.

“Just like the US, you can’t ignore China either, but it’s still a difficult market to navigate. It’s still growing, even though China has closed itself off a bit,” Karlsson says. “Looking at future growth, you’d wish more goods exports went to Asia. We’d like to have more Asia in our books at EKN.”

No slowdown in demand for guarantees

Demand for EKN’s export credit guarantees remains strong.

Defence, energy and infrastructure are the heaviest sectors right now, along with telecom. Much of that business goes to high-income OECD countries, a trend EKN has seen since the financial crisis almost 20 years ago.

Expect instability – and be ready for it

What does he expect for the rest of 2026 and into 2027? Karlsson won’t bet on any single event. “When we sat here a year ago, we didn’t discuss an American-Israeli attack on Iran of this scale.”

The conflict may be less intense now, but it is far from resolved. A new risk has emerged in Yemen, where the Houthi rebels now control the outlet from the Red Sea, the route Saudi Arabia has used to export large volumes of oil. “They can cause serious problems for world trade.”

“All things considered, something sooner or later has to happen in a more solution-oriented direction, most likely in the first half of 2027, to give a more lasting solution in the Middle East.”

Then there is the ongoing war in Ukraine, which shows no sign of reaching a definitive end. “It’s hard to know how that situation will develop over time. And it has a price, of course.”

Politics adds further uncertainty. The US midterm elections in November and the election in France next spring are two upcoming uncertainties.

Karlsson’s conclusion: “Risk factors and moments of anxiety occur almost all the time. We don’t have long periods where everything works exactly the same way. Expect a continued unstable situation in the world market, but there are opportunities and tools to handle the turbulence.”

Advice for Nordic tech exporters

His advice for tech companies with export ambitions is to get the basics in order. “Have your structure and organization in place to navigate the uncertain situation. Review your supply chains, finances and investments.”

“Once you’ve actually become an exporting company, EKN can be an option for support, even at an early stage. If you’re really early, it’s still risk capital that applies.”

And don’t forget the home continent. “Europe is an extremely important market for Sweden, so we should take advantage of that and target markets within the EU.”