II. Trade Relations and Economic-Technological Cooperation

Since the establishment of diplomatic ties, the economic and trade relations between Sweden and China have grown vigorously. The two countries signed the Inter-Governmental Trade Agreement in 1957. The trade volume between China and Sweden in 1957 reached US$ 31.87 million, 10 times that in 1950. The Chinese trade delegation led by the Foreign Trade Minister Lu Xuzhang visited Sweden in 1959. The Swedish company ATLAS held a mining equipment exhibition in Beijing in 1965, which was the first exhibition ever held by Swedish enterprises independently in China. In 1978 the trade volume between the two countries surpassed US$ 100 million for the first time.

Sweden and China set up the Mixed Committee on Economic and Trade Cooperation at vice-ministerial level in 1979. Sweden adopted generalized preferential system (GPS) to China in 1980 and began to make direct investments in China and provide China concessional loans in 1982. Sweden lifted quota restrictions on porcelain in 1985, and textile products and clothes in 1991. In 1988, a direct air route between Beijing and Stockholm was opened and operated by Air China and SAS.

Since the 1990s, the economic and trade relations between the two sides have developed rapidly. The trade volume surpassed US$ 1 billion in 1994. In 2002, the total trade volume between China and Sweden was US$2.7 billion, down 12.8% year on year. Of this, China's export value was US$910 million, down 2.3% year on year, and its import value was US$1,790 million, down 17.4%. China's main exports were garments, suitcases and bags, shoes, plastic products, textile fibers, coke, canned vegetables, toys, furniture, and telecommunication products. Main imports from Sweden were telecommunication products, steel products, iron ore, precision instruments, building and mining machines. At present, China has become the second largest market in Asia for Sweden and is its 13th largest trade partner.

Sweden attaches importance to the exploit of Chinese market. In 2002, 51 investment projects were concluded, with contracted investment reaching US$910 million and the capital actually utilized totaling US$100 million. According to incomplete statistics, Sweden has set up about 200 joint-ventures and solely owned companies in China, including Astra (Wu Xi) Pharmaceutical Co. Ltd., Shougang Kanthal Corporation Ltd., Nanjing Ericsson Communication Co. Ltd., Beijing Nankou SKF Railway Bearing Co. Ltd. and IKEA furniture Co. Ltd., etc.