Microsoft announces that standard price increases of up to 43 percent are now pending for users of Microsoft 365.The company says the sharp increases are necessary to fund the development of AI technology that is now being integrated into products such as Word and Excel.
Starting in February 2025, the price of Microsoft 365 Personal will rise from $70 to $100 per year. For the Family subscription, which includes up to six users, the cost will increase from $100 to $130 per year.
The price increases are also the first since the service was launched in 2013.
– We are investing heavily in AI technology to improve user productivity and efficiency, Microsoft said in a statement to Bloomberg.
The new AI features, known as Copilot, will be integrated into Word, Excel, PowerPoint and other programs in Microsoft’s suite. Copilot can, among other things, generate text, create presentations and automate administrative tasks, Investopedia reports.
Microsoft says the features will help users save time and be more productive.
The company has invested heavily in AI development, and is said to have invested a total of $99 billion in the area over the past year. At the same time, the investment has been criticized by some users who believe that the increased prices risk excluding some consumers, according to The Verge.
Customers who do not want to take advantage of the AI features will have the opportunity to choose to keep their existing subscriptions in the “Personal Classic” or “Family Classic” versions without a price increase.
Microsoft also offers an AI credit model for features such as image generation, as well as the ability to disable AI features if users wish. Despite this, complaints against the new pricing remain, as critics believe the changes are pressuring consumers to fund AI technology they may not need.
The strategy seems clear: AI will be a central part of Microsoft’s future products and services.
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Elisabeth Svantesson, the Moderate Party’s Minister for Finance, believes that Trump’s trade tariffs and the unrest they have caused will also affect the Swedish economy.
– We had good conditions for getting the economy going. But then this happened, which we’ve talked about a lot – the trade war has materialized, she emphasizes.
According to Svantesson, the Swedish economy was recovering at the end of 2024 – but this recovery has now been interrupted, and the Americans are being blamed.
The finance minister says that confidence in the US has been badly damaged and will take a long time to rebuild – and that the Trump administration’s actions have damaged both the US and European economies.
–It is sad that one of Sweden’s partners, the United States, is acting in this way, she said:
– What we are experiencing now is unprecedented.We have a trade war at a time when markets are highly integrated.
“Higher costs for businesses and households”
Although the finance minister admits that the consequences of the trade war are difficult to determine in advance, she nevertheless maintains that Sweden remains strong “with world-class public finances” and the focus of the spring budget, according to Svantesson, is on getting “the wheels turning” through various economic measures such as increased tax deductions and increased funding for the Swedish Public Employment Service.
–We don’t know all the consequences of the trade war yet, but we know that it is harmful… But with this budget we are protecting Sweden, and we are prepared to do more, she adds.
Despite the SEK 11.5 billion (€1 billion) in measures, unemployment is predicted to rise from 8.2% today to 8.6% by the end of the year, and inflation to 2.5%, from 1.9% previously.
The Ministry of Finance expects Sweden’s GDP to grow by 2.1% in 2025 – lower than previous estimates. However, growth is expected to pick up in 2026 and 2027, according to the forecast, which may be revised in the future.
“The announcement of increased import tariffs in the United States has caused turbulence in financial markets and sharp stock market declines.Higher tariffs are expected to lead to higher costs for businesses and households, which is expected to dampen demand.At the same time, increased uncertainty itself risks dampening economic activity as firms and households postpone investments, hiring and purchases”, the assessment says.
In a wide-ranging interview with The Duran , economist Jeffrey Sachs critiques Donald Trump’s tariff policies, calling the administration’s understanding of trade deficits “completely flakey” and warning of severe economic and geopolitical consequences.
Sachs, a Columbia University professor and former UN advisor, emphasizes that tariffs will not address the root causes of US trade imbalances and instead risk fragmented trade, rising consumer costs, and global instability.
Sachs begins by rejecting the core argument for Trump’s tariffs: the claim that US trade deficits result from “unfair” foreign trade practices.
– The trade deficits have nothing to do – I will say nothing to do – with the trade policies of the rest of the world. They have no indication whatsoever that anybody is ripping off anybody, especially that the rest of the world is ripping off the United States.
He defines a trade deficit as a macroeconomic imbalance, not a trade policy failure.
– What a trade deficit means – pure and simple – is that a country is spending more than it is earning. That’s all.
Sachs dismisses the Trump administration’s diagnosis as “completely flakey”, comparing it to a shopper blaming stores for overspending.
– Trump calls that a ripoff. It’s a little strange… It’s like a person who goes on a shopping binge, runs a current account deficit against all those stores they visited, and then blames the shops for those imbalances.
– The diagnosis is completely flakey. I taught international monetary economics for 22 years at Harvard. In the second day of the undergraduate course, I explained that a current account deficit was an imbalance of spending and production, essentially – not a measure of trade policy.
The twin-deficit problem
Sachs warns that tariffs will harm US households and industries, raising prices for goods like automobiles and disrupting supply chains.
– If you say, ‘We’re not going to have trade’… that pushes workers into the labor-intensive, low-skilled sectors in this value chain. That lowers living standards.
He highlights the risks of stock market instability, referencing a $10 trillion loss in global markets during tariff disputes.
– This is losing what we call the gains from trade.
Sachs draws a direct comparison to the 1930 Smoot-Hawley Tariff Act, which exacerbated the Great Depression.
– The protectionism of 1930 in the United States was an accelerant [of the Depression].
Sachs ties trade deficits to US fiscal policy, emphasizing the “twin deficits” problem.
– We call this the twin deficits problem: You have a large budget deficit that shows up as a large trade deficit, so it’s a twin deficit. This is kind of a chronic characteristic of the US.
He critiques the weaponization of the dollar, noting that US sanctions incentivize countries to abandon the dollar.
– The weaponization of the dollar in confiscating Russian reserves, Venezuelan reserves, Iranian reserves … means that if you have some trade dispute or foreign policy dispute with the US, you’re likely to get your money confiscated.
Geopolitical risks: Taiwan as the next Ukraine
Sachs warns of broader geopolitical fallout, referencing a 2015 Council on Foreign Relations paper titled Revising U.S. Grand Strategy Toward China by Robert Blackwill and Ashley Tellis and highlights its argument for containing China’s rise.
– The argument [in the paper] is China’s rise is no longer in America’s interest. It must be stopped. A shocking idea: we must do damage to another side not because they threaten us, but because they are too big and therefore they undermine US hegemony – that’s literally the argument in the paper. Not a list of nefarious actions by China.
– The grand strategy of the United States, since it’s inception – in essence – is primacy: The United States must be number one. And so, we must prevent any challenge [to dominance] … And this is the motivation for much of what’s happening from 2015: The attempt to form, in crazy ways, new trade groups in Asia that don’t include China, the export bans on technology, the attempt to destroy companies like Huawei and ZTE and rumours and machinations of all sorts of imagined dangers.
Sachs warns that this confrontational approach risks catastrophic escalation over Taiwan, fueled by tariffs and military posturing.
– The unilateral tariffs Trump imposed – not on the world in his first term, but specifically on China – and now the very punitive tariffs on China … are deeply enmeshed in military buildups and military alliances in East Asia, in saber-rattling every day about Taiwan with the real risk that Taiwan turns itself into the next Ukraine by making the same kind of bets on US protection that Ukraine made, that ended up destroying so much of Ukraine, the same thing could happen in Taiwan.
– If it does, the war is going to be even more dangerous for the world, potentially even catastrophic, and with the instability of US economic and political leadership combined with the deep-state animus toward China, it’s pretty risky.
On Wednesday morning, the trade tariffs previously announced by President Donald Trump were imposed – including import tariffs of 104% on Chinese products.
– Everything the US buys from China will disappear.There will be a huge price shock in every way and shortages of all kinds of things, warns Alexis von Sydow, China analyst at the Swedish Institute of International Affairs.
In addition, an additional tariff on some selected Chinese goods will begin to be levied during the day, according to White House press secretary Karoline Leavitt.
She claims that Trump is confident that the Chinese will back down and withdraw their counter-tariffs – reiterating Trump’s message that the US has been unfairly treated as a trading partner and will ultimately be the big winner, becoming richer and more prosperous as a country from the tariffs.
The Trump administration has claimed, among other things, that the measures will lead to the creation of more American jobs and shift much of the production that takes place abroad to the United States.
However, most people do not seem to believe in this strategy, as evidenced by the stock market’s blood-red figures. China, for example, has announced that it is ready to fight “to the end”, and Alexis von Sydow believes that the tariffs mean that “everyone is in trouble”, and that many product categories will skyrocket in price.
“Will escalate”
Fredrik Cho, China consultant and vice-chairman of the Sweden-China Trade Council, agrees and does not believe that either side is ready to back down or that the conflict is coming to an end.
– Lots of companies will be wiped out, he predicts, and continues:
– It will escalate further.This will go on for quite a while,
It’s worth noting that China is by far the US’s top importing country, importing around $450 billion worth of goods last year. Many of these – such as electronics – are now expected to soar in price.
Cho emphasizes that Trump’s policy is directly counterproductive as it will negatively affect the US economy – while rapidly forcing China in the direction its leaders aspire to – with a greater focus on the domestic market.
– It will accelerate the process towards what the Chinese government wants.They want to focus more on domestic demand and consumption.
Sweden can “find new trade routes”
He does not see any disastrous effects for China, but it may be difficult for the Chinese to achieve the set growth target.
– It is clear that it will be noticed and there will be a bump in the curve.
How the tariffs will affect Sweden and other EU countries is not entirely clear. However, the centre-right government has warned of lower growth and price shocks on many products can be expected.
– In the longer term, there are other effects.For example, we will find new trade routes and will not trade in the same way if the tariffs remain in place in the longer term… But growth will decrease and that is why we say that this is bad, commented Elisabeth Svantesson, the Conservative finance minister, last week.
China is taking a hard line against the recent US tariffs, which impose 34% tariffs on Chinese goods and threaten an additional 50% if the country does not give in to US demands. It stresses that the US tariffs violate World Trade Organization (WTO) rules and threaten global stability.
In response, China has imposed equivalent 34% tariffs on US goods and filed complaints with the World Trade Organization against the US tariff increases. In addition, China has tightened control over exports of rare earth metals – a crucial lever in the technology industry, as the US gets 70% of these materials from China.
The trade war has already wreaked havoc on the world’s financial markets. More than $10 trillion has been wiped off stock markets since the imposition of tariffs, and oil prices have fallen to their lowest level in two years. According to analysis by Goldman Sachs, the risk of a US recession rises to 45% within a year, with the threat of disrupted supply chains and higher prices for consumers.
— Chinese Embassy in US (@ChineseEmbinUS) April 7, 2025
“Economic bullying will backfire”
The Chinese embassy in the US highlights Ronald Reagan’s comments on trade wars. In a statement from the Chinese Embassy in Stockholm this weekend, it further emphasizes that US tariffs pose a threat to the multilateral trading system, referring to them as “unilateralism, protectionism and economic bullying”. The embassy calls on the international community to condemn what it describes as unilateralism and to protect the WTO system, arguing that “economic bullying will ultimately backfire”.
It also stresses that China, as the world’s second largest economy, intends to continue opening its market and sharing development opportunities with other countries for mutual benefit. In a clear message to Europe, where EU exports are threatened by 20% tariffs from the US, it stresses that “there are no winners in trade or tariff wars” and that protectionism is “a dead end”.
