Sweden's economy is one of Europe's strongest and is set for further solid growth this year, Radio Sweden reported on Monday, quoting a report of the Organization for Economic Co-operation and Development (OECD).

The OECD's survey of Sweden, issued every two years, praised the country's "strong and steady" economic performance, saying that the economy had performed better than most other European nations.

The organization forecast a gross domestic product growth of 3. 6 percent in 2007 after an expected 4.3 percent in 2006, slowing to 2.9 percent in 2008.

The report heaped praise on Sweden for its recovery from the economic crisis of the early 1990s, saying the country's response had laid foundations for the current successes.

Despite economic growth, inflation has stayed low, the OECD said, and Sweden's central bank had "a highly credible" monetary policy.

The bank raised interest rates six times last year and on Feb. 15 announced a further increase in the base rate to 3.25 percent.

The OECD also hailed the government's plans to sell its holdings in companies like telecom operator TeliaSonera and banking giant Nordea.

However it warned the government not to be tempted by strong finances to push through unfinanced tax cuts and stressed that additional measures were needed to spur job growth.

Source: Xinhua