Was Sweden’s refusal to lockdown a gruesome mistake?

15 August 2020

2:49 AM

15 August 2020

2:49 AM

Was there ever a jury destined to spend so long over its deliberations as the one considering whether Sweden made a terrible error over its refusal to go into lockdown? Just when you think the data points in one direction, another piece of data nods in the other. The case against Sweden rests largely on its death toll being significantly higher than that of its Nordic neighbours: 572 per million compared with 107 for Denmark, 60 for Finland and 48 for Norway. But then it also happens to be lower than several countries which had especially severe lockdowns, such as Spain (612), Britain (609) and Italy (583).

But what of the economy? The counsel for Sweden can point out that the country’s GDP fell in the second quarter by 8.6 percent, markedly less than the EU average of 12 per cent. Compare Sweden with its Nordic neighbours, however, and the picture is less flattering. Denmark’s figure of – 7.4 per cent and Finland’s figure of – 3.2 per cent would seem to question whether Sweden has gained all that much economically from its policy of avoiding lockdown. Norway has yet to produce its GDP figures for the second quarter.

So was Sweden’s policy all a gruesome mistake? Simply to compare the GDP for the second quarter makes little sense. Denmark was one of the first countries to go into lockdown, in the second week of March, two weeks earlier than Britain. It was also one of the first countries to emerge from lockdown. A large slice of the economic damage, therefore, ought to show up in its GDP figures for the first quarter, when its economy shrank by 2.1 percent. Sweden’s economy in the first quarter, by contrast, grew by 0.1 per cent. Put those figures together and over the first half of the year the Swedish economy shrank by a little less than did Denmark’s.

As for Finland, its economic performance in the second quarter might be regarded as miraculous. To have emerged from lockdown with GDP falling by just 3.2 per cent is remarkable, given the economic turmoil elsewhere. But then Finland already was recession in March: its economy had shrunk by 0.9 per cent in the first quarter of 2020 and by 0.6 per cent in the last quarter of 2019. Its economy is also naturally a little more Covid-proof than is Sweden’s. It relies a little less on exports – $13,900 (£10,600) per capita against Sweden’s $16,000 (£12,000) per capita. Sweden’s biggest export – cars – was especially badly hit – although Finland’s biggest exports, refined petroleum and paper, were exactly enjoying a boomtime either.

But economic and mortality comparisons for the first half of 2020 are hardly the end of the story. The whole rationale of the Swedish approach is that it would contract the period in which Covid would affect the economy and society. By building herd immunity quickly, Sweden would be out of the woods relatively quickly. Countries which locked down, on the other hand, would suffer a resurgence of the disease when they opened up again, forcing them back into lockdown, perhaps multiple times before a vaccine was discovered, herd immunity was achieved or the disease died away of its own accord.

With Denmark, like locked-down Spain and France, now witnessing a significant second wave of new infections, there is some reason to think that Swedish thinking on this might have been right. The jury is going to be out for a long time yet.

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