Is Finland Headed Downhill?
The eurozone has been struggling to keep itself on the road to recovery — but with poor economic indicators and setbacks in many countries. One of the better performers within the eurozone, has been Finland. Unfortunately, that doesn’t exclude it from negative economic effects, and according to Bloomberg, job losses and high national debt are major problems for Finland.
Finland’s credit has been placed above all others in the eurozone, and the country has been given a AAA economy rating. Even so, the Finish Finance Minister, Jutta Urpilainen, said that the countries fiscal problems are “historic” ones. “I would like to promise that the euro crisis will end this year, that Finnish structural change in industry will stop and government-debt growth will halt,” he said, according to Bloomberg — “Unfortunately, I can’t,” Urpilainen said.
Annual Gross Domestic Product for Finland dropped down to 0.6 percent in October, unemployment reached 7.9 percent in November, up from 7.4 percent in October, and there are concerns about Finland overflowing on the European Union’s debt stipulations. “Finland is still quite significantly depressed,” said Paul Krugman, a Nobel Laureate, to Bloomberg.
Bjorn Wahlroos became famous after his work with the Union Bank of Finland in the 80s, and his work in mergers and acquisitions in Scandinavia. He is the Chair of the Board at three of the biggest Finish firms: Sampo Group, Nordea, and UPM-Kymmene, according to Yle Uutiset.
Wahlroos said that Finlands inability to compete internationally with exports is simply explained. “We are just too expensive to be a valid producer for the export market. This is the heart of our problem,” said Wahlroos, according to Yle Uutiset. “Finland’s entrance into the EU was supposed to introduce more flexibility in the development of our economy and wage formation. This has not been the case. Among all of the countries in the euro zone, salaries have risen most in Finland. This makes it very difficult to export Finnish labour to the world. We have lost a huge amount of market share,” said Wahlroos.