Finland

Capital: Helsinki

Local time:
It is %T:%M %A in Helsinki

Exchange rate on :

GDP growth rate: 2.2% in 2012

FDI stock: 85 237 million USD in 2007

Country risk: See the country risk analysis from Finland provided by Ducroire.

Economic trends

Often used as an example for its economic performances and its competitiveness and innovative successes, Finland is one of the countries in the euro zone which has been hit the hardest by the crisis. In 2008, the GDP growth rate slowed down significantly, well below the estimated 2.7%. The gross national product dropped considerably in the second quarter of 2009, compared to the same period in 2008, and the country went into recession. In Parallel, the unemployment rate increased considerably to reach today's 9% levels. Inflation, on the other hand, has remained under control.
At the end of 2008, the annual rise in consumer prices exceeded the 2% mark for the first time in five years. Nearly half of this overall rise comes from increased housing costs and higher interest rates. The government budget is expected to show a 3% GDP deficit for the 2009 and 2010 activities.

Main branches of industry

Agriculture represents less than 3% of the current Finnish GNP. Because of the climate, agricultural development is limited to the maintainace of a certain level of self-sufficiency in basic products.  Finland's accession to the EU has further accelerated the process of restructuring and downsizing of this sector.
One of Finland's key economic sectors is production, in particular, wool, metals, engineering, telecommunications, the electronics industry and especially the forestry industry. In effect, the wood industry and paper manufacturing are very developed and represent the backbone of Finnish exports. It is the second sector of activity for the rural population. However, the production sector has slowed down significantly, especially because of the decrease in demand in the paper sector (newspapers and magazines), caused by the world economic crisis.
The telecommunications sector also represents an important section of the country's industrial activity due to Nokia, the world leading manufacturer of mobile telephones, which accounts for a significant part of the country's exports.

International trade

Finland is a highly industrialized country, whose economy relies heavily on exports (40% of the GNP). In 2007, the EU countries accounted for more than the majority of Finnish exports and imports. In 2008, Finland was affected by the financial crisis, which upset its trade balance, a fact which did not hinder the country showing a trade surplus in 2008. However, the balance went into deficit in 2009 and should go back into surplus in 2010.

The policies implemented between 1996 and 2000 (privatization, decentralization, reform of the labor market , etc.) led the public sector to making significant improvements and led the country to be ranked amongst the best growth performers in the European Union. These good results make the Finnish market more attractive to exporters. In addition, the increase in the Finnish consumers' purchasing power has boosted Finnish imports. However, considering the current economic situation, consumers might go back to cheaper foreign products, a fact which would contribute to the deterioration of the country's trade balance.

Learn more

For more information on Finland

The Country Profiles of the Foreign and Commonwealth Office

Countries information of the UK Trade and Investment Website

For more international news

Business News of the British Chamber

For more advices

The business advices of the Foreign and Commonwealth Office

Are You Ready to Export? - The online test of the UK Trade and Investment Website