🇸🇪➡️💶 From Krona to Euro? Sweden Reopens a Once-Unthinkable Debate as Security Fears Reshape Europe

More than two decades after Swedish voters rejected the euro in a landmark 2003 referendum, Sweden is cautiously reopening the question of whether to abandon the krona and join Europe’s shared currency.

Back then, the argument was economic: keeping the krona allowed flexibility to cushion shocks.
Today, the conversation is increasingly about security, influence, and belonging to Europe’s inner circle as global tensions rise.

Russia’s war in Ukraine—which pushed Sweden to abandon decades of military neutrality and join NATO—has triggered a broader reassessment of how exposed smaller economies are in a world shaped by major-power rivalry.

Lawmakers now speak openly about aligning more closely with partners in the European Union, not just militarily, but financially.

“We are reinforcing our defenses alongside our EU partners,” said Liberal Party lawmaker Cecilia Rönn. “But we are still standing with one foot outside when we are not part of the currency cooperation.”

Sweden’s reconsideration comes amid a dramatically altered geopolitical landscape:

Supporters argue that adopting the euro would anchor Sweden more firmly within Europe’s decision-making core—giving it influence over monetary policy that already affects much of its trade.

Finance Minister Elisabeth Svantesson has backed launching a formal inquiry into the pros and cons, signaling that what was once political taboo is now legitimate policy discussion.

“The world is changing, and the EU is changing,” Svantesson told parliament. “We must dare to evaluate what is in Sweden’s best interests.”

A key voice in the debate is economist Lars Calmfors, who led the government study ahead of the 2003 referendum and was then cautious about adopting the euro.

Now, he says the strategic calculus has transformed.

Geopolitical realities, he argues, increase the value of belonging to Europe’s “core,” both politically and economically. Trade gains and foreign investment benefits in euro-area countries have proven stronger than many analysts expected two decades ago.

Sweden’s economy has also become more synchronized with eurozone cycles, reducing the need for an independent currency to fine-tune policy responses.

Corporate Sweden—deeply tied to European markets—is increasingly vocal about the downsides of remaining outside the euro.

Financier Christer Gardell, co-founder of activist investment firm Cevian Capital, has long criticized the krona’s volatility, arguing it complicates planning for exporters such as Volvo AB.

“The small, illiquid and volatile krona is a disadvantage for Swedish industry,” Gardell said, adding that euro membership would eliminate that uncertainty.

More than 60% of Sweden’s goods trade is conducted with EU countries, compared with just a small share with the United States—an imbalance that strengthens the argument for currency alignment.

Encouragement is also coming from across the Baltic.

Finland, already a euro member and sharing a long border with Russia, views the currency as part of its security architecture. Finnish central bank chief Olli Rehn has urged Sweden and Denmark to consider joining, arguing that together Nordic economies would wield greater influence inside the euro system.

Despite elite momentum, Swedish voters remain cautious:

Political resistance is also strong. The nationalist Sweden Democrats has made defending the krona an election pledge, arguing that abandoning a national currency risks eroding sovereignty.

“Our currency is intimately tied to our independence,” a party spokesperson warned during parliamentary debate.

Even advocates acknowledge that adopting the euro would take years. Sweden would need to stabilize its exchange rate against the euro for at least two years and meet strict economic convergence criteria, meaning any transition would likely take four years or more.

Yet supporters see parallels with Sweden’s rapid NATO accession—once politically unimaginable, until events forced a swift pivot.

“For me, the euro isn’t a question of ‘if,’” said Rönn. “It is a question of ‘when.’”

If Sweden ultimately joins the euro, the move would not only reshape Nordic finance but also strengthen the currency bloc at a time when the dominance of the U.S. dollar is increasingly debated.

What began as a technical monetary discussion is evolving into something far larger:
a decision about where Sweden positions itself in a world defined less by economics alone—and more by alliances, resilience, and geopolitical gravity.