Finland: Slow recovery due to structural weaknesses
OCTOBER 17, 2013
After four quarters of falling quarterly GDP, Finland left the recession behind with 0.2 percent growth in the second quarter of 2013. The
outlook continues to be weak
and therecovery is lagging behind the other Nordic countries. Exports have been weak and theearlier resilient
household sector is at present also showing weaknesses
The economy is not only troubled by cyclical factors, but it has also become increasinglyclear that some
problems are more deeply rooted and structural
. The export ratio hasfallen 10 percentage points compared to the pre-crisis level, terms-of trade have fallenand unemployment is expected to decrease only slowly. The current account has trendedfrom 8 to -2 per cent of GDP in 10 years.
We expect growth to be 0.3 per cent each quarter compared to the previous quarterduring the second half of 2013 and after that a slight continued improvement. Overall,
GDP will fall by 0.8 per cent in 2013
, a downward revision compared to our previousforecast.
In 2014 and 2015 GDP will grow by 1.4 and 1.6 per cent, respectively.
Economic Research+46 735 23 52 87
2012 2013 2014 2015
GDP -0.8 -0.8 1.2 1.6Unemployment
7.7 7.9 7.7 7.5Inflation 3.2 2.2 1.9 1.8Government fiscal balance** -2.2 -2.2 -2.0 -2.0
* Per cent of labour force, ** Per cent of GDPSource: SEB