This chapter provides an overview of Sweden’s macroeconomic performance. It highlights salient features of Sweden’s economy – openness to international trade and foreign direct investment integration in global markets – and sketches out patterns of structural change in production and trade. It also looks at the current state of framework conditions as they relate to entrepreneurship and innovation. It concludes with a discussion of the role of innovation in Sweden’s economic development in the longer term and highlights new trends in innovation as well as the increasing role of knowledge-based capital.