Population 5,4 million
GDP 42413 US$
Country risk assessment
Business Climate
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major macro economic indicators

  2014 2015  2016 (e) 2017 (f)
GDP growth (%) -0.6 0.3 1.4 1.3
Inflation (yearly average) (%) 1.2 -0.2 0.3 0.8
Budget balance (% GDP) -3.2 -2.8 -2.7 -2.5
Current account balance (% GDP) -1.1 -0.4 -0.7 -0.6
Public debt (% GDP) 60.2 63.6 67.1 69.6


(f) Forecast


  • Prudent economic policies
  • Skilled workforce and favourable business climate
  • Cutting-edge industries
  • High standard of living


  • High vulnerability to the international situation
  • Industrial crisis and loss of competitiveness
  • Dependence of the Finnish banking sector on the Swedish and Danish financial sectors
  • Ageing population

Risk assessment

Timid recovery of activity, supported by private investment

After sluggish growth in 2015, the economy saw a slight recovery in 2016, thanks to private consumption and dynamic investment. In 2017, growth should remain moderate, supported by growth in private investment and exports. Indeed, the industrial sector (25% of GDP) would see a progressive recovery through investment in energy as well as in the forestry and shipbuilding industries. These industries would benefit from a more dynamic foreign demand and the government's policy to improve business competitiveness. Low interest rates favour residential investment and construction, and growth will also be observed in the services sector (75% of employment).

Moreover, private consumption would be less dynamic than in previous years, limited by an agreement between social partners providing for slower growth in wages until the end of 2017. In addition, the still high level of unemployment (8.8%), fiscal austerity and the household debt burden (120% of disposable income) would continue to hamper growth in private consumption. However, the purchasing power of households would improve to the extent that real wages would see a slight increase, in a context of still modest inflation (albeit slightly increasing). Dependence on exports in the economy (37% of GDP) and demand from its main trading partners (Russia, Germany and the Nordic countries) could affect the business activity in case of a slowdown in demand in these countries.


Public funding remain contained despite an industrial stimulus policy

In 2017 the government's priority will remain focused on the fight against unemployment and the revival of the industrial sector, which continues to suffer from low competitiveness. A Competitiveness Pact was signed with social partners in late 2016 with the aim of reducing unit labour costs by 4% in 2017. The main measures concern the extension of the annual working time (additional 24 hours without wage compensation), a transfer of a portion of employer charges to employee contributions and wages, which would increase less rapidly. The authorities have nevertheless granted households a reduction in income tax in order to offset rising social security contributions. In addition, the government would invest more in infrastructure, especially in transport. This policy would be funded by budget cuts in education and in R&D and by the reform of the social security system which would see this power transferred to local institutions (economies of scale). Thus, the budget deficit would still be below 3% but public debt would continue to rise slightly, while remaining relatively low compared to other countries in the eurozone.

Meanwhile, the implementation of this policy would have a positive impact on the current account, which would be close-to-balance. Exports would be improve especially in the pharmaceutical, petrochemical and in the forest industry, driven by better competitiveness and an increase in orders. Furthermore, the electronics sector would benefit from the recovery (early 2017) on the smartphones market observed in the Nokia brand, purchased from Microsoft by a Finnish company. Nevertheless, the increase in imports would halt the improvement observed in the current account in 2017, due to a more dynamic domestic demand and a moderate increase in oil prices.


A coalition government weakened by unpopular measures

Finnish voters entrusted power to the Centre Party in the parliamentary elections held in April 2015. The coalition government, which also includes the Finns Party (far right) and the National Coalition, the centre-right party, holds a comfortable majority in parliament (124 seats out of 200). However this coalition is weak, insofar as the withdrawal of one of the three parties would cause a loss of majority for the government. Moreover, the opposition parties have been strengthened following the unpopularity of the Competitiveness Pact reforms, which aim to reduce unit labour costs and improve competitiveness. The Social Democratic Party even came out ahead according to a poll conducted in October 2016. The government will be judged on the results of its reform plan, particularly in terms of unemployment.

The business environment remains very favourable as the country ranks 13th out of 190 in the latestDoing Businessreport published by the World Bank, with particularly remarkable performance in insolvency settlement.



Last update : January 2017



Bills of exchange are not commonly used inFinlandbecause, as inGermany, they signal the supplier's distrust of the buyer. A bill of exchange primarily substantiates a claim and constitutes a valid acknowledgment of debt.


Cheques, also little used in domestic and international transactions, but only constitute acknowledgement of debt. However, cheques that are uncovered at the time of issue can result in the issuers being liable to criminal penalties.


Moreover, as cheque collection takes particularly long in Finland (20 days for domestic cheques or cheques drawn in European and Mediterranean coastal countries, 70 days for cheques drawn outside Europe), that payment method is not recommended.


Conversely, SWIFT bank transfers are increasingly used to settle domestic and international commercial transactions. Finns are familiar with this efficient method of payment. When using this instrument, sellers are advised to provide full and accurate bank details to facilitate timely payment, while it should not be forgotten that the transfer payment order will ultimately depend on the buyer's good faith.


Debt collection


Out-of-court collection begins with a demand letter together with the invoice copies that refers to the debt with request to pay the outstanding principal increased by past-due interest stipulated in the contract.


In the absence of an interest rate clause in the agreement, interest automatically accrues from the due date of the unpaid invoice at a rate equal to the Central Bank of Finland's (Suomen Pankki) six-monthly rate, calculated by reference to the European Central Bank’s refinancing rate, plus seven percentage points (Interest Act Amendment, effective since 1st July 2002).


The Interest Act (Korkolaki) of 20 August 1982 already required debtors to pay up within contractually agreed timeframes or become liable to interest penalties.


Note, moreover, that according to contract law the ordinary limitation period, previously ten years, has been reduced to three years since 1 January 2004 and that it applies retroactively to contracts already in force.


For clear and uncontested claims, creditors may resort to the fast-track procedure resulting in an injunction to pay (suppea haastehakemus). This is a simple written procedure based on submission of whatever documents substantiate the claim (invoice, bill of exchange, acknowledgement of debt, etc.).

The court sets a time limit of about two weeks to permit the defendant to react, or to oppose the petition.

Considering undisputed claims, this fast track procedure can now be initiated by electronic means.


The presence of a lawyer, although commonplace, is not required for this type of action.


The court proceedings are conducted in Finnish or Swedish language (Language Act – Kielilaki 423/2003 – in force on 1st January 2004) and the courts, in their majority, consider that the language used is not likely to extend the duration of the proceedings.


The reform of civil procedure, enacted on 1st December 1993, requires plaintiffs to submit all supporting documents and evidence substantiating a claim before the debtor is asked to provide, in response, a written statement explaining his position.


During the preliminary hearing, the court bases its deliberations on the parties’ written submissions and supporting case documents. The court then convokes the litigants to hear their arguments and decide on the relevance of the evidence.


At this preliminary phase, it is possible with judge’s assistance, the dispute should be resolved by mediation between the litigants and their business relationship should be protected.


Where the dispute remains unresolved after this preliminary hearing, plenary proceedings are held before the court of first instance (Käräjäoikeus) comprising one to three presiding judges depending on the case’s complexity. During this hearing, the judge examines probative documentary evidence, hears the parties’ witnesses and the litigants state their final claims before the judge delivers the ruling very rapidly, generally within 14 days.


The losing party is liable for all or part of the legal costs incurred by the winning party.

The average time required for obtaining a writ of execution is about twelve months.


Commercial cases are generally heard by civil courts, although a Market Court (Markkinaoikeus) located in Helsinki, has been in operation as a single entity since the 1st March 2002, merger of the Competition Council and the former Market Court.


This court is competent to examine fraudulent business practices, denounce unfair trading, investigate corporate mergers, deliver prohibition orders against such practices and slap fines on offenders.

Insolvency trend Finland
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