Financial Management Rita Kattilakoski, Ma4n0207 Finnish Economy

AGENDA  INTRODUCTION  HISTORY  ECONOMY  Current Situation  International Trade  Future

INTRODUCTION  Republic of Finland – located in Northern Europe  Population 5.5 million  Majority live in the southern regions  8th largest country in Europe in terms of land area  Most sparsely polulated country within the EU  Åland Island – an autonomous region  Capital city: Helsinki (1.4 million people live in the Helsinki area)  Official languages: Finnish (89%), Swedish (6%)  Sami people in the North of Finland (0.03%)  Currency: Euro

HISTORY 1. Prior to 1809 – Part of Sweden 2. Russia took over from  Highest governing body was the Senate – members were Finns  Senate communicated with Russian Emperor – Russian authorities were unable to interfere  Finnish became the official language 3. Independent country from 1917 to the present day (98 years)  Final peace treaty with Russia in 1947

ECONOMY  In the 1950s Finnish economy based on primary production and agrarian workforce – one of the poorest countries in Europe  Quite fast Finland developed and is now relatively rich and economically stable country in international comparison  Largest sectors: services 65%, manufacturing and refining 31%  Main industrial products: paper and board, electronics and metal products  Leading branches of manufacturing: engineering and high technology industries  Resources: mineral (iron, chromium, copper and gold)and freshwater

ECONOMY GDP: 204 bn € (2014) GDP per capita: at current market prices 49,055€ (2014) Monthly wages: average 3,206€; men 3,530€, women 2,891€ (2013) Unemployment rate: 8.7% (2014) Inflation rate: % (2015)  Member of EU since 1995 and Eurozone 2002  State Debt: 60%/ Deficit: 3.2%  Warning from European Comission

Europe: GDP per capita

INTERNATIONAL TRADE  EU makes up 60% of the total trade  Largest trade flows with:  Germany, Russia, UK, USA, Netherlands, Sweden and China  Trade policy regulated by EU  Trade accounts one-third of the GDP

INTERNATIONAL TRADE

FUTURE  The economy is slowly coming out of a long recession  Economic activity is broadly flat in 2015  But projected to strengthen in 2016  Export growth remains slow  Global demand for capital goods has weakened and exports to Russia have decreased  Domestic demand low  Rising unemployment, low income growth, consumer´s weak confidence  The budget deficit has risen above 3% of GDP for the first time since the mid-1990s  Government tries to reduces spending  However structural reforms are essential to revive growth, ensure long-term fiscal sustainability and generate resources to support well-being

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