Country Economic Forecasts > Finland

Preliminary figures show the Finnish economy returned to recession in Q4 2015, with GDP falling 0.1% on the quarter after a 0.5% decline in Q3. Despite the weak performance in H2, the economy managed to achieve positive growth for the whole year for the first time since 2011, but with just 0.1% growth the Finnish economy remains in a very precarious situation.The external sector remains hard hit by the recession in Russia, one of Finland's main trading partners, which is causing Finnish exports to struggle. Arrivals of Russian tourists have also been badly hit, with declines of close to 50% from a year ago. As a result, we expect the economy to improve only very gradually, posting growth of just 0.4% this year. Our forecast then shows growth accelerating to 1.3% in 2017 and around 1.6% a year in 2018-19.Over the long run, Finland still needs to address its high labour costs, reverse the declining labour participation rate and steer the country onto a new industrial model following the demise of its all-important electronics and forestry industries in recent years.