"Within one month our revenues had jumped over 50%."

Trade in Finland

finnish lake
Finland has recently ranked as one of the world’s most peaceful, competitive, and livable countries; according to various surveys like the Failed States Index, 2009 Legatum Prosperity Index, and a report by Newsweek. Finland is in many similar to its other Nordic peers such as Norway, Sweden, and Denmark; in terms of social welfare policies, small populations, and high Human Development. According to the IMF, Finland’s nominal GDP per capita is $44,488; while it’s nominal GDP is $239.232 billion. Finland’s population is relatively small at 5,400,519, according to Finland’s Census for 2011.Finland has a highly industrialized mixed economy with a per capita output equal to that of other European economies such as France,Germany, Belgium or the UK. The largest sector of the economy is services at 66%, followed by manufacturing and refining at 31%. Primary production is 2.9%, according to statistics published by the Finnish government. With respect to foreign trade, the key economic sector is manufacturing. The largest industries are electronics (22%), machinery, vehicles and other engineered metal products (21.1%), forest industry (13%) and chemicals (11%), according to Statistics Finland. Finland has timber and several mineral and freshwater resources. Forestry, paper factories, and the agricultural sector (on which taxpayers spend around 3 billion euros annually) are politically sensitive to rural residents. The Greater Helsinki area generates around a third of GDP. Overall short-term outlook was good, and GDP growth has been above many EU peers. Finland is highly integrated in the global economy, and international trade is a third of GDP. The European Union makes 60% of the total trade. The largest trade flows are with Germany, Russia, Sweden, United Kingdom, United States, Netherlands and China. Trade policy is managed by the European Union, where Finland has traditionally been among the free trade supporters, except for agriculture. Finland is the only Nordic country to have joined the Eurozone.The Finnish economy is quite conducive to foreign trade, considering that it is highly integrated into the global economy. In the annual World Bank survey, of the countries that are Easiest to do Business in, Finland did quite well according to their rankings. Overall, Finland was the 11th easiest country to do business in for 2012; which is an increase of three spots from Finland’s 14th place ranking for 2011. Finland was ranked 6th for trading across borders and 11th for enforcing contracts. However, Finland was ranked 65th for protecting investors. It is unlikely though; that the Finnish government would create conditions that would be detrimental for foreign investors, who are looking to exercise their right to property. You can actually look at the World Bank’s official report here, in order to get more detailed information on the conditions for doing trade in Finland’s economy. (http://www.doingbusiness.org/data/exploreeconomies/finland/)

Overall, Finland seems to be reasonable country to invest in and do business in. One of the key downsides is that its national currency is the Euro, which is currently going through major crises right now. As a result, the crises may spill over into Finland if it is not resolved soon enough. While the Finnish government has been somewhat more responsible that the other European governments in terms of controlling debt. Any major crises will likely hurt Finnish businesses as well, since Finland is deeply integrated into Europe’s economy. The Finnish population is also relatively small and is growing quite slowly and in some cases it’s stagnant, making the Finnish market quite small to sell into for foreign businesses. But Finland is a relatively safe country to do business in, for businesses that are just looking for a measure of economic stability.

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Author:Globial International Business Team

The Globial International Business Team researches, analyzes, and reports on all things related to global trade and business.

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One Response to “Trade in Finland”

  1. February 6, 2012 at 2:45 am #

    Reblogged this on PlanMill: Accelerating Your Success! and commented:
    More detailed information from the World Bank on the conditions for doing trade in Finland’s economy. http://www.doingbusiness.org/data/exploreeconomies/finland/

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