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Finland’s public finances have gathered strength; the general government deficit has shrunk and the ratio of public debt to GDP has begun to contract. Yet determined efforts are still required to address the challenges to fiscal sustainability in the long term.

The economy has recovered from the recession following the financial crisis, but growth is expected to remain below its pre-crisis level, averaging 1.5% per annum over 2026–2040.

Finland’s GDP grew 1.2% quarter-on-quarter in the first quarter of 2018 and 3.1% year-on-year. The Finnish economy has now grown for ten consecutive quarters.

Global demand, improved competitiveness and favourable financing conditions will support growth. GDP growth forecasts for 2018–2020 stand at 2,9%, 2,2%, and 1,7%. Inflation will remain close to 1% over the years 2018–2019 before gathering pace and reaching 1.5% in 2020.

Unprofitable firms occupy economic resources and slow down productivity growth.

An extensive use of restrictions on international trade would substantially weaken global trade and economic growth in Finland.

Output is growing faster than its potential and the Finnish economy is expected to remain at its cyclical peak during 2018–2020.

Following the turn in the economic cycle, growth in labour costs have slowed, and the rise in the output price has been most clearly linked to stronger corporate profitability.

The period 2004 - 2017 under review was particularly challenging for forecasting.

According to the structural unemployment indicator based on labour market flows, unemployment in Finland is at slightly over 8%.

The global economy is still growing strongly, but there are already certain signs that the growth rate is levelling off. The deceleration in euro area growth has long been expected in the forecasts.

Forecast tables for the Finnish economy in 2018–2020 (June 2018).