Contributor(s): Anders Borg | For the fifth year running Europe is preoccupied with financial turmoil, weak public finances, anemic growth and high unemployment. Progress has been made but with global growth weakening and downside risks on the rise fiscal consolidation remains challenging. The Swedish experience shows that prudent reforms can foster growth while maintaining social cohesion and an extensive welfare state. Twenty years ago, Sweden had large deficits and high debt and experienced a major economic crisis and the loss of investor confidence. Today, Sweden is lauded for its sustainable public finances, real wages have grown at a solid pace for twenty years and a fair income distribution has been maintained. What are the key priorities for growth? And how should policymakers strike a balance between strengthening public finances, sustaining demand and promoting growth? Anders Borg is Minister for Finance in Sweden and has chaired the ECOFIN Council during the 2009 Swedish EU Presidency. He has previously worked as an advisor on monetary policy issues at the Swedish Central Bank and as chief economist at several Swedish banks.