Fin Economy - 2022

Economic overview

Finland has a highly industrialized, largely free-market economy with per capita GDP almost as high as that of Austria and the Netherlands and slightly above that of Germany and Belgium. Trade is important, with exports accounting for over one-third of GDP in recent years. The government is open to, and actively takes steps to attract, foreign direct investment.

Finland is historically competitive in manufacturing, particularly in the wood, metals, engineering, telecommunications, and electronics industries. Finland excels in export of technology as well as promotion of startups in the information and communications technology, gaming, cleantech, and biotechnology sectors. Except for timber and several minerals, Finland depends on imports of raw materials, energy, and some components for manufactured goods. Because of the cold climate, agricultural development is limited to maintaining self-sufficiency in basic products. Forestry, an important export industry, provides a secondary occupation for the rural population.

Finland had been one of the best performing economies within the EU before 2009 and its banks and financial markets avoided the worst of global financial crisis. However, the world slowdown hit exports and domestic demand hard in that year, causing Finland’s economy to contract from 2012 to 2014. The recession affected general government finances and the debt ratio. The economy returned to growth in 2016, posting a 1.9% GDP increase before growing an estimated 3.3% in 2017, supported by a strong increase in investment, private consumption, and net exports. Finnish economists expect GDP to grow a rate of 2-3% in the next few years.

Finland's main challenges will be reducing high labor costs and boosting demand for its exports. In June 2016, the government enacted a Competitiveness Pact aimed at reducing labor costs, increasing hours worked, and introducing more flexibility into the wage bargaining system. As a result, wage growth was nearly flat in 2017. The Government was also seeking to reform the health care system and social services. In the long term, Finland must address a rapidly aging population and decreasing productivity in traditional industries that threaten competitiveness, fiscal sustainability, and economic growth.

Real GDP (purchasing power parity)

$261.39 billion (2020 est.)

$268.84 billion (2019 est.)

$265.46 billion (2018 est.)

note: data are in 2017 dollars

Real GDP growth rate

1.15% (2019 est.)

1.52% (2018 est.)

3.27% (2017 est.)

Real GDP per capita

$47,300 (2020 est.)

$48,700 (2019 est.)

$48,100 (2018 est.)

note: data are in 2017 dollars

GDP (official exchange rate)

$269.259 billion (2019 est.)

Inflation rate (consumer prices)

1% (2019 est.)

1% (2018 est.)

0.7% (2017 est.)

Credit ratings

Fitch rating: AA+ (2016)

Moody's rating: Aa1 (2016)

Standard & Poors rating: AA+ (2014)

note: The year refers to the year in which the current credit rating was first obtained.

GDP - composition, by sector of origin

agriculture: 2.7% (2017 est.)

industry: 28.2% (2017 est.)

services: 69.1% (2017 est.)

GDP - composition, by end use

household consumption: 54.4% (2017 est.)

government consumption: 22.9% (2017 est.)

investment in fixed capital: 22.1% (2017 est.)

investment in inventories: 0.4% (2017 est.)

exports of goods and services: 38.5% (2017 est.)

imports of goods and services: -38.2% (2017 est.)

Agricultural products

milk, barley, oats, wheat, potatoes, sugar beets, rye, pork, poultry, beef

Industries

metals and metal products, electronics, machinery and scientific instruments, shipbuilding, pulp and paper, foodstuffs, chemicals, textiles, clothing

Industrial production growth rate

6.2% (2017 est.)

Labor force

2.52 million (2020 est.)

Labor force - by occupation

agriculture: 4%

industry: 20.7%

services: 75.3% (2017 est.)

Unemployment rate

6.63% (2019 est.)

7.38% (2018 est.)

Youth unemployment rate (ages 15-24)

total: 17.1%

male: 17.8%

female: 16.4% (2021 est.)

Population below poverty line

12.2% (2019 est.)

Gini Index coefficient - distribution of family income

27.4 (2017 est.)

22.2 (1995)

Household income or consumption by percentage share

lowest 10%: 6.7%

highest 10%: 45.2% (2013)

Budget

revenues: 134.2 billion (2017 est.)

expenditures: 135.6 billion (2017 est.)

note: Central Government Budget data; these numbers represent a significant reduction from previous official reporting

Budget surplus (+) or deficit (-)

-0.6% (of GDP) (2017 est.)

Public debt

61.3% of GDP (2017 est.)

62.9% of GDP (2016 est.)

note: data cover general government debt and include debt instruments issued (or owned) by government entities other than the treasury; the data include treasury debt held by foreign entities; the data include debt issued by subnational entities, as well as intragovernmental debt; intragovernmental debt consists of treasury borrowings from surpluses in the social funds, such as for retirement, medical care, and unemployment; debt instruments for the social funds are not sold at public auctions

Taxes and other revenues

53.1% (of GDP) (2017 est.)

Fiscal year

calendar year

Current account balance

-$603 million (2019 est.)

-$4.908 billion (2018 est.)

Exports

$108.22 billion (2019 est.) note: data are in current year dollars

$106.01 billion (2018 est.) note: data are in current year dollars

$109.513 billion (2017 est.)

Exports - partners

Germany 14%, Sweden 10%, United States 8%, Netherlands 6%, China 6%, Russia 5% (2019)

Exports - commodities

refined petroleum, paper and wood pulp products, cars, stainless steel, lumber (2019)

Imports

$107.39 billion (2019 est.) note: data are in current year dollars

$109.45 billion (2018 est.) note: data are in current year dollars

$110.701 billion (2017 est.)

Imports - partners

Germany 16%, Sweden 14%, Russia 13%, China 6%, Netherlands 6% (2019)

Imports - commodities

crude petroleum, cars and vehicle parts, refined petroleum, broadcasting equipment, packaged medicines (2019)

Reserves of foreign exchange and gold

$10.51 billion (31 December 2017 est.)

$11.2 billion (31 December 2016 est.)

Debt - external

$631.549 billion (2019 est.)

$536.301 billion (2018 est.)

Exchange rates

euros (EUR) per US dollar -

0.82771 (2020 est.)

0.90338 (2019 est.)

0.87789 (2018 est.)

0.885 (2014 est.)

0.7634 (2013 est.)