Swedish PM
(Swedish Prime Minister Stefan Lofven)

Swedish PM loses confidence vote in parliament

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Swedish centre-left Prime Minister Stefan Lofven, 63, has lost a no-confidence vote on Monday (June 21) morning. The motion, which required 175 votes in the 349-seat parliament to pass, was supported by 181 legislators.

Lofven, who has served as premier since 2014, is the first Swedish prime minister to be ousted by a no-confidence motion put forward by the opposition. The Social Democratic party leader now has a week to resign and hand the speaker of the parliament the job of finding a new government or call a snap election.

“The government now has a week to decide and we will hold talks with our cooperation parties,” Lovfen told a news conference after the vote. “It is what is best for the country that is important. We will work as fast as we can.”

According to the largest Nordic economy’s Constitution, a snap election would come on top of next year’s scheduled ballot and would therefore see the Swedes brought to the polls twice in a little over a year.

Lofven refused to back down from a deregulation plan aimed at Sweden’s rental housing market,
with the Left Party saying he had crossed a red line. The Left then won support from a group of conservative and nationalist parties, eager to eject their political foe.

The parties that voted against Lofven were the Left Party, Moderates, Christian Democrats and Sweden Democrats.

The Scandinavian nation has strict regulations on rents aimed at maintaining affordable prices in larger cities. However, this makes property developers less willing to invest in building new homes for the rental market. People needing to rent a home can find themselves waiting for years for a contract, and buying property is increasingly hard amid soaring home prices. However, the Left Party fears that deregulating the rental market will lead to rapid price increases and deeper segregation between rich and poor.

“A political crisis is not good in this economic situation,” Finance Minister Magdalena Andersson told reporters in Stockholm. “We are just beginning an economic recovery and a lot of businesses are considering whether to hire, whether to invest and there is a risk that those decisions will be postponed as a consequence of the political uncertainty.”

The Swedish krona was little changed against the euro after the vote.

With reporting by The Local Sweden, Euronews, Reuters and Bloomberg