The Baltic economies: Catalysts for the internationalization of Swedish SMEs?

Abstract:

Decades of globalization have fundamentally reshaped global trade. Deeper economic integration has not only led to increased access to foreign markets but also increased interdependence.This project focuses on the relations between the Baltic countries and Sweden. Baltic independence has been surprisingly important for small and medium-sized enterprises in Sweden. Until the early 1990s, foreign direct investment (FDI) - in particular FDI aiming to access cheap labor - was primarily limited to the largest firms. The potential low cost destinations were located far away from Sweden, e.g. in East Asia, and few SMEs had the capacity to manage production activities in distant markets. With the creation of new low cost locations on the shores of the Baltic Sea, it became feasible also for small Swedish firms to consider FDI as way to lower production costs and raise competitiveness.