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Finland Economy

    Economy—overview: Finland has a highly industrialized, largely free-market economy, with per capita output roughly that of the UK, France, Germany, and Italy. Its key economic sector is manufacturing—principally the wood, metals, engineering, telecommunications, and electronics industries. Trade is important, with the export of goods representing about 30% of GDP. Except for timber and several minerals, Finland depends on imports of raw materials, energy, and some components for manufactured goods. Because of the climate, agricultural development is limited to maintaining self-sufficiency in basic products. Forestry, an important export earner, provides a secondary occupation for the rural population. The economy has come back from the recession of 1990-92, which had been caused by economic overheating, depressed foreign markets, and the dismantling of the barter system between Finland and the former Soviet Union. Rapidly increasing integration with Western Europe—Finland was one of the 11 countries joining the euro monetary system (EMU) on 1 January 1999—will dominate the economic picture over the next several years. Growth in 1999 probably will slow, perhaps to 3%, a barrier to any substantial drop in unemployment.

    GDP: purchasing power parity—$103.6 billion (1998 est.)

    GDP—real growth rate: 5.1% (1998 est.)

    GDP—per capita: purchasing power parity—$20,100 (1998 est.)

    GDP—composition by sector:
    agriculture: 5%
    industry: 32%
    services: 63% (1997)

    Population below poverty line: NA%

    Household income or consumption by percentage share:
    lowest 10%: 4.2%
    highest 10%: 21.6% (1991)

    Inflation rate (consumer prices): 1.5% (1998 est.)

    Labor force: 2.533 million

    Labor force—by occupation: public services 30.4%, industry 20.9%, commerce 15%, finance, insurance, and business services 10.2%, agriculture and forestry 8.6%, transport and communications 7.7%, construction 7.2%

    Unemployment rate: 12% (1998 est.)

    Budget:
    revenues: $33 billion
    expenditures: $40 billion, including capital expenditures of $NA (1996 est.)

    Industries: metal products, shipbuilding, pulp and paper, copper refining, foodstuffs, chemicals, textiles, clothing

    Industrial production growth rate: 7.4% (1995)

    Electricity—production: 67.469 billion kWh (1996)

    Electricity—production by source:
    fossil fuel: 54.73%
    hydro: 17.35%
    nuclear: 27.9%
    other: 0.02% (1996)

    Electricity—consumption: 71.169 billion kWh (1996)

    Electricity—exports: 1.7 billion kWh (1996)

    Electricity—imports: 5.4 billion kWh (1996)

    Agriculture—products: cereals, sugar beets, potatoes; dairy cattle; fish

    Exports: $43 billion (f.o.b., 1998)

    Exports—commodities: machinery and equipment, chemicals, metals; timber, paper, and pulp

    Exports—partners: Germany 11%, UK 10%, Sweden 10%, US 7%, Russia 7%, France 4%, Japan (1997)

    Imports: $30.7 billion (f.o.b., 1998)

    Imports—commodities: foodstuffs, petroleum and petroleum products, chemicals, transport equipment, iron and steel, machinery, textile yarn and fabrics, fodder grains

    Imports—partners: Germany 15%, Sweden 12%, UK 8%, Russia 8%, US 7%, Japan 5% (1997)

    Debt—external: $30 billion (December 1993)

    Economic aid—donor: ODA, $388 million (1995)

    Currency: 1 markka (FMk) or Finmark = 100 pennia

    Exchange rates: markkaa (FMk) per US$1—5.12 (January 1999), 5.3441 (1998), 5.1914 (1997), 4.5936 (1996), 4.3667 (1995), 5.2235 (1994);
    note: on 1 January 1999, the European Union introduced a common currency that is now being used by financial institutions in some member countries at the rate of 0.8597 euros per US$ and a fixed rate of 5.93472 Markkaa per euro; the euro will replace the local currency in consenting countries for all transactions in 2002

    Fiscal year: calendar year

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Revised 1-Mar-99
Copyright © 1999 Photius Coutsoukis (all rights reserved)