According to preliminary data, Finland’s GDP growth rate was estimated at 1.1 percent in 2019. Since the 2008-2009 financial crisis, Finland has faced difficulties catching up to its peer countries in export industry competitiveness, productivity, and employment rates. The GDP decline of 8.1 percent in 2009 was the worst since the "great depression" of the early 1990’s. Even though the economic growth has been positive from 2016 onwards, the general government budget has remained in deficit. Correspondingly, the national debt has increased dramatically over the past decade, peaking at an all-time high of 63.6 percent in 2015. In 2019, the government debt relative to GDP was 59.4 percent, and the budget deficit amounted to roughly 2.7 billion euros.
As an open export-led economy, foreign trade is vital for the Nordic country. In 2019, exports of goods and services accounted for 40 percent of Finland’s GDP. Consequently, Finland is also vulnerable to external shocks and conjuncture in the international economy. The backbone of the Finnish economy has traditionally been forestry, in particular exports of wood, paper, and chemical pulp. Although the forest industry products still account for around 20 percent of export revenue, heavy machinery and manufactured products now constitute a larger share of export trade. Moreover, Finland excels in the ICT technologies, gaming, cleantech, and biotechnology sectors. Imports mainly consist of industrial products, raw materials for industrial use, consumer goods, and mining products.
Finland's economic growth was already slowing down by the end of 2019, but the coronavirus (COVID-19) crisis plunged the economy into recession during the second quarter of 2020. However, the Finnish economy has fared better than predicted in the early forecasts of spring 2020. It is estimated that Finland’s total output will decline by roughly six percent, and return to growth in 2021 and 2022 as demand picks up. According to monthly data, the inflation rate was negative between April and June 2020, meaning that overall consumer prices fell slightly despite the COVID-19 lockdown measures. While the full-blown consequences of the COVID-19 pandemic remain uncertain, the negative impact on employment will likely be long-lasting. For further information on the employment situation in Finland, please visit our dedicated statistics and facts page.