Sweden is planning subsidies of USD 1.5 billion at sky-high prices
STOCKHOLM (AFP) – Sweden yesterday announced plans for a subsidy package of 1.45 billion USD (1.32 billion euros) to help Swedes cope with sky-high prices as a result of Russia’s invasion of Ukraine on the heels of winter’s sky-high energy prices.
The proposed subsidies include a temporary reduction in petrol and diesel taxes, a one-off payment of at least SEK 1,000 (USD 104) to car owners, a one-month extension to March of a winter electricity subsidy for homeowners in central and southern Sweden, and a temporary increase in housing allowances for the poorest families.
Sweden has among the highest prices in the world for fuel largely thanks to its high taxes, around 21 SEK (2.20 USD) per liter for petrol and 25 SEK for diesel.
If approved by Parliament, the measures would enter into force on 1 June.
“Today we present an exceptional package of measures to counteract the price increases we now see as a result of Russia’s invasion,” Finance Minister Mikael Damberg said in a statement.
“The situation is still uncertain and prices are very volatile, but we can see that we need to support consumers in this urgent phase and at the same time take action to reduce our dependence on fossil fuels.”
Prices in February rose by 4.5 per cent from a year earlier, Statistics Sweden stated yesterday, the highest level since 1993 when the country was in a deep economic crisis.
Electricity was 14 percent higher than a year ago, while food prices rose by 3.6 percent and clothing by five percent.
Analysts noted that these increases in February did not include the effects of Russia’s invasion – which began on February 24 – and predicted further increases to come.