George Hahn

A recent analysis from Boston Consulting Group found that 30% of Swedish firms ranked in the top quartile of performance for their sectors, nearly double the performance of the best performing EU nation, the Netherlands.

The report cited three drivers of Swedish exceptionalism, a culture of risk-taking encouraged by worker mobility, paired with strong unemployment benefits, sustained government investment in R&D, and deep capital markets.

As The Economist wrote last year, Stockholm is the new capital of capital.

Crucially, participation in Sweden's capital markets is widespread.

Thanks to the creation of ISK investment accounts, which simplify trading and eliminate capital gains taxes in favor of an annual standardized income tax, Swedish households invest over half their savings in equities, more than twice the European average.

Although it has the population of North Carolina, Sweden has produced more than 30 unicorns, including Ericsson, King, Klarna, and Spotify.

With only 2% of the EU's population and 3% of its GDP, nearly one out of every five of Europe's best-performing companies are Swedish.

Taiwan, which manufactures 97% of the world's high-end chips and controls 72% of the global foundry market, is the choke point for AI and the digital economy.

But the island nation is downstream of the Netherlands.

NVIDIA designs the most advanced chips, and TSMC manufactures them.

But both companies, along with the rest of the industry, depend on a single company, ASML, for the machines that make any of it possible.

ASML is the world's only producer of the extreme ultraviolet lithography machines used to manufacture the most advanced chips, and it commands 90% of the broader lithography market.

This month, ASML became Europe's most valuable company, making the picks and shovels of AI.

Dutch economic leverage isn't an accident, but the result of government policies.

Its infrastructure and R&D investments, highly skilled English-speaking labor pool, strong legal and regulatory frameworks, and favorable tax regime make the Netherlands a digital economy hub as well as the gateway to Europe.

In terms of moving atoms, Rotterdam is Europe's busiest port, handling 438 million tons of cargo annually, nearly double the capacity of Antwerp, Europe's second largest port.

Advances in vertical farming, seed technology, and robotics have allowed the Netherlands in recent decades to halve the resources that go into food production while doubling the output.

Last year, the country, the size of Maryland, was the second largest agricultural exporter in the world by value behind the U.S.

In terms of moving bits, the Netherlands is one of Europe's key connection points for global information technology infrastructure.

The country ranks second worldwide for online connectivity, with 98% of the population connected to high-speed Internet, 20 points above the EU average of 78%.