NationMaster - Encyclopedia: Economy of Finland

Finland has a highly industrialized, largely free-market economy, based on abundant forest resources, capital investments, and technology. Traditionally, Finland has been a net importer of capital to finance industrial growth. In the 1980s, Finland's economic growth rate was one of the highest of industrialized countries, with per capita output roughly that of the United Kingdom, France, Germany, Sweden and Italy.

Finland's key economic sector is manufacturing - principally the wood, metals, engineering, telecommunications and electronics industries. The telecommunications and electronics industries are now the biggest export sector. Trade is important, with exports equaling more than one-third 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, although the importance has declined in the recent years.

In 1991, Finland fell into a deep recession caused by economic overheating, depressed foreign markets and the dismantling of the barter system between Finland and the former Soviet Union. More than 20% of Finnish trade was with the Soviet Union before 1991, and in the following two years the trade practically ceased. 1991 and again in 1992, Finland devalued the markka to promote export competitiveness. This helped stabilize the economy; the recession bottomed out in 1993, with continued growth through 1995. Since then the growth rate has been one of the highest of OECD countries. 1991 (MCMXCI) is a common year starting on Tuesday of the Gregorian calendar. ... 1992 (MCMXCII) was a leap year starting on Wednesday. ... 1993 (MCMXCIII) is a common year starting on Friday of the Gregorian calendar and marked the Beginning of the International Decade to Combat Racism and Racial Discrimination (1993-2003). ... 1995 (MCMXCV) was a common year starting on Sunday of the Gregorian calendar. ... The Organization for Economic Co-operation and Development (OECD) is an international organization of those developed countries that accept the principles of representative democracy and a free market economy. ...

The recession caused serious unemployment problem as unemployment soared from 3,2 % in 1990 to 16,6 % in 1994. Unemployment continues to be a problem for Finland even if rapid growth of the production after the recession and active employment policies have reduced unemployment to 8,8 % of labor force in 2004. According to Bank of Finland's statistics, the estimated total rate of unemployment including hidden unemployment accounted to 18% in the fall of 2003. 1994 (MCMXCIV) was a common year starting on Saturday of the Gregorian calendar, and was designated the International year of the Family. ... 2004 (MMIV) was a leap year starting on Thursday of the Gregorian calendar. ... The Bank of Finland, Helsinki, with the statue of Johan Vilhelm Snellman in front. ... Dorothea Langes Migrant Mother depicts destitute pea pickers in California during the Great Depression. ... 2003 (MMIII) is a common year starting on Wednesday of the Gregorian calendar. ...

Exports of goods contribute more than 20% of Finland's GDP; combined exports of goods and services amount to at least 25% of GDP. Exports and imports of goods equal about 40% of GDP. Timber and metalworking are Finland's main industries, but other industries produce manufactured goods ranging from electronics to motor vehicles. Finnish-designed consumer products such as textiles, porcelain, and glassware are world-famous.

Except for timber and several minerals, Finland depends on imported raw materials, energy, and some components for its manufactured products. Farms tend to be small, but sizeble timber stands are harvested for supplementary income in winter. The country's main agricultural products are dairy, meat, and grains. Finland's EU accession has accelerated the process of restructuring and downsizing of this sector, with the farming population decreasing. Timber Timber is a term used to describe poo bum holes that has been processed for use â€”from the time trees are felled, to its end product as a material suitable for industrial use â€”such as structural material for construction or wood pulp for paper production. ...

An extensive social welfare system, constituting about one-fifth of the national income, includes a variety of pension and assistance programs and a comprehensive health insurance program. Although free education through the university level also is available, only about one child in four receives a higher education in the highly competitive system. In the mid-1970s, the educational system was reformed with the goal of equalizing educational opportunities. Beginning at age seven, all Finnish children are required to attend a comprehensive school (peruskoulu) of nine grade levels (six primary and three secondary). After this, they may elect to continue along an academic (lukio) or vocational (ammattikoulu) line. About 60% select the academic line. The number of openings in higher educational institutions is less than the demand. The education is based in Finnish or Swedish language. It is also now possible to study in English from primary up to University.

Finland generally welcomes foreign investment. Areas of particular interest for investors are specialized high-tech companies and investments. The good infrastructure in Finland has enhanced Finland's position as a gateway to Russia.

According to Transparency International, Finland has the lowest level of corruption in all the countries studied in their survey. The contrary is true The 10 least corrupt countries, according to the Transparency International perception survey, 2004. ... Since 1995, Transparency International has published an annual Index of perception of corruption ordering the countries of the world according to the level of public perception of corruption of public and political functionaries. ...

Finland is experiencing rapidly increasing integration with Western Europe: Finland was one of the 11 countries joining (Greece joined later) the Economic and Monetary Union (EMU) on 1 January 1999. The national currency markka (FIM) in circulation was withdrawn and replaced by euro (EUR) in the beginning of 2002. In economics, a monetary union is a situation where several countries have agreed to share a single currency among them. ... January 1 is the first day of the calendar year in both the Julian and Gregorian calendars. ... 1999 (MCMXCIX) is a common year starting on Friday, and was designated the International Year of Older Persons by the United Nations. ...

GDP: EUR 135.976 billion (2001). Purchasing power parity - $152.955 billion (2004 est.)

GDP - per capita: EUR 28,643 per capita in 2004. Purchasing power parity - $29,000 (2004 est.)

GDP - composition by sector:
agriculture: 3.3%
industry: 30.2%
services: 66.5% (2004 est.)

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

Labor force - by occupation: public services 32%, industry 22%, commerce 14%, finance, insurance, and business services 10%, agriculture and forestry 8%, transport and communications 8%, construction 6%

Budget:
revenues: $96.43 billion
expenditures: $91.95 billion (2004 est.)

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

Electricity - production by source: The terawatt hour (TW·h) is a unit for measuring energy. ...

Agriculture - products: cereals, sugar beets, potatoes; dairy cattle; fish A fossil fuel power plant (FFPP) (also known as steam electric power plant in the US, thermal power plant in Asia, or power station in the UK) is an energy conversion center designed on a large scale for continuous operation. ... Hydroelectricity is a form of hydropower used to produce electricity. ... This article is about power derived from nuclear reactions. ...

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

Exports - partners: (EU 53.0%) Germany 11.8%, Sweden 9.9%, UK 8.1%, USA 8.1%, Russia 7.5%, France 3.7%, China 2.2% (2003)

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

Imports - partners: (EU 55.0%) Germany 15.0%, Russia 11.9%, Sweden 11.1%, UK 5.3%, France 4.8%, USA 4.7%, China 4.3% (2003)

Exchange rates: euros per US$1 - 1.0073 (September 2002), 0.9867 (January 2000), 0.9386 (1999); markka (FMk) per US$1 - 5.3441 (1998), 5.1914 (1997), 4.5936 (1996), 4.3667 (1995)
note: The euro (EUR) has replaced the local currency markka (FIM) on 1 January 2002. The rate was EUR 1 = FIM 5.94573. January 1 is the first day of the calendar year in both the Julian and Gregorian calendars. ... 2002 (MMII) is a common year starting on Tuesday of the Gregorian calendar. ...