Economy of Finland

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Economy of Finland

A panoramic view over the southernmost districts of Helsinki from Hotel Torni. The Helsinki Old Church and its surrounding park are seen in the foreground, while the towers of St. John's Church (near centre) and Mikael Agricola Church (right) can be seen in the middle distance, backdropped by the Gulf of Finland.
Currency	Euro (EUR, €)
Fiscal year	calendar year
Trade organisations	EU, WTO and OECD
Country group	Advanced economy[1] High-income economy[2]
Statistics
Population	5,550,066 (1 March 2023)[3]
GDP	$302 billion (nominal, 2023)[4] $338 billion (PPP, 2023)[4]
GDP rank	48th (nominal, 2023) 59th (PPP, 2023)
GDP growth	2.1% (2022)[5] 0.0% (2023f)[5] 1.3% (2024f)[5]
GDP per capita	$54,351 (nominal, 2023)[4] $60,897 (PPP, 2023)[4]
GDP per capita rank	15th (nominal, 2023) 23rd (PPP, 2023)
GDP by sector	agriculture: 2.7% industry: 28.2% services: 69.1% (2017 est.)[6]
Inflation (CPI)	1.6% (2022 est.)[7]
Population below poverty line	15.8% at risk of poverty or social exclusion (AROPE, 2023)[8]
Gini coefficient	26.6 low (2023)[9]
Human Development Index	0.940 very high (2021)[10] (11th) 0.890 very high IHDI (5th) (2021)[11]
Labour force	2,774,226 (2021)[12] 77.8% employment rate (2023)[13]
Labour force by occupation	Agriculture and forestry 1.4% Industry 10.5% Construction 10.1% Wholesales and retail trade 21.3% Finance, insurance and professional and business services 20.3% Transport and communications 14.9% Community social and personal services 21.5% (2017 est.)
Unemployment	7.6% (September 2020)[14] 20.6% youth unemployment rate (July 2020; 15 to 24 year-olds)[15]
Average gross salary	€3,974 monthly (2023)
Average net salary	€2,366 monthly (2023)
Main industries	metals and metal products, electronics, machinery and scientific instruments, shipbuilding, pulp and paper, foodstuffs, chemicals, textiles, clothing[6]
External
Exports	€98.47 billion (2021 est.)[16]
Export goods	electrical and optical equipment, machinery, transport equipment, paper and pulp, chemicals, basic metals; timber
Main export partners	Germany 14.2%  Sweden 10.3%  Netherlands 6.9%  United States 6.8%  China 5.7%  Russia 5.7%  United Kingdom 4.5% (2017 est.)[17]
Imports	€97.88 billion (2021 est.)[16]
Import goods	foodstuffs, petroleum and petroleum products, chemicals, transport equipment, iron and steel, machinery, computers, electronic industry products, textile yarn and fabrics, grains
Main import partners	Germany 15.5%  Russia 13.2%  Sweden 11.0%  China 7.3%  Netherlands 5.6%  France 3.8% (2017 est.)[17]
FDI stock	$135.2 billion (31 December 2017 est.)[6] Abroad: $185.6 billion (31 December 2017 est.)[6]
Current account	$1.806 billion (2017 est.)[6]
Gross external debt	$150.6 billion (31 December 2016 est.)[6]
Public finances
Government debt	69.2% of GDP (2020)[18] €142.507 billion (2019)[18]
Budget balance	−€2.7 billion (2019)[18] −1.1% of GDP (2019)[18]
Revenues	52.2% of GDP (2019)[18]
Expenses	53.3% of GDP (2019)[18]
Economic aid	€1.7 billion from European Structural and Investment Funds (2007–2013)[19]
Credit rating	AAA (Domestic) AAA (Foreign) AA+ (T&C Assessment) (Standard & Poor's)[20] Scope:[21] AA+ Outlook: Stable
Foreign reserves	$10.51 billion (31 December 2017 est.)[6]
All values, unless otherwise stated, are in US dollars.

The economy of Finland is a highly industrialised, mixed economy with a per capita output similar to that of western European economies such as France, Germany, and the United Kingdom. The largest sector of Finland's economy is its service sector, which contributes 72.7% to the country's gross domestic product (GDP); followed by manufacturing and refining at 31.4%; and concluded with the country's primary sector at 2.9%.^[22][23] Among OECD nations, Finland has a highly efficient and strong social security system; social expenditure stood at roughly 29% of GDP.^[24][25][26]

Finland's key economic sector is manufacturing. The largest industries^[27] are electronics (21.6% - very old data), machinery, vehicles and other engineered metal products (21.1%), forest industry (13.1%), and chemicals (10.9%). Finland has timber and several mineral and freshwater resources. Forestry, paper factories, and the agricultural sector (on which taxpayers spend around 2 billion euro annually) are politically sensitive to rural residents. The Helsinki metropolitan area generates around a third of GDP.^[28]

In a 2004 OECD comparison, high-technology manufacturing in Finland ranked second largest in the world, after Ireland. Investment was below the expected levels.^[29] The overall short-term outlook was good and GDP growth has been above many of its peers in the European Union. Finland has the 4th largest knowledge economy in Europe, behind Sweden, Denmark and the UK.^[30] The economy of Finland tops the ranking of the Global Information Technology 2014 report by the World Economic Forum for concerted output between the business sector, the scholarly production and the governmental assistance on information and communications technology.^[31]

Finland is highly integrated in the global economy, and international trade represents a third of the GDP. Trade with the European Union represents 60% of the country's total trade.^[32] The largest trade flows are with Germany, Russia, Sweden, the United Kingdom, the United States, the Netherlands and China.^[32] The 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; Denmark and Sweden have retained their traditional currencies, whereas Iceland and Norway are not members of the EU at all. Finland has been ranked seventh in the Global Innovation Index of 2023, making it the seventh most innovative country down from 2nd in 2018.^[33][34]

Finland is one of the few European countries that achieved development without a historical involvement in colonialism, slave trade, or tax evasion and money laundering.