Foreign Trade Minister Cites Finland’s Strong Fundamentals

Paavo Väyrynen, Minister of Foreign Trade
Paavo Väyrynen, Minister of Foreign Trade

Finland’s trade based economy has been hit hard by the global economic downturn, but Minister of Foreign Trade and Development Paavo Väyrynen is optimistic about the future because of Finland’s very solid fundamentals. He explains, “Finland is actually a miracle. After World War II we were still a developing country and were required to pay heavy war compensations, but nevertheless in only a few decades we have become a global leader in many high tech fields. Finland provides a sustainable environment for businesses of all kinds, as well as being stable, innovative, and within easy access of the EU and many growing markets.”

Paavo Väyrynen’s ministerial career began in 1975 when he was appointed Minister of Education for the second government of former Prime Minister Miettunen. He has served in several governments and in fact is the second longest serving minister in Finland’s history. He was appointed Minister of Foreign Trade and Development in April 2007.

Strong ties with China

The minister points out that while Finland’s main trading partners are Germany, Russia and Sweden, the country’s trade with China has grown so rapidly that now Finland is China’s top trade partner in the Nordic region. “Finnish companies have been very active in Asia for a long time, and we are expanding our trade there,” he explains.

During a visit to Hong Kong and Shenzhen in October 2010, the minister commented, “The special arrangements for economic development in Southern China have enabled rapid growth of the economy and trade, and Finnish companies have had a role in this. At the same time as Southern China offers impressive horizons for both Chinese and global markets, it is also good to remember Finland’s importance to Chinese businesses as a gateway to the rest of Europe – the shortest route from Asia to Europe is by way of Finland.” He highlighted the example of the Golden Bridge Chinese Innovation Centre in Finland, which is the first Chinese innovation centre to be set up abroad.

Minister Väyrynen is also targeting Latin America and Africa, and says that Finland will of course continue to trade with neighbouring countries in the Nordic and Baltic regions as well as with the EU. He predicts particularly strong growth in trade with Russia.

Significant advantages for business

Concerning Finland’s investment potential, Paavo Väyrynen points out that while production costs in Finland are relatively high, this is balanced out by the country’s stability, well-developed infrastructure and pro business environment. Finland also offers significant tourism potential. “Finland is cool in the sense that it is trendy but it is also cool in the summer when other parts of the world are very hot. We also have uncrowded ski centres and luxury hotels, and Helsinki has become a key international air travel hub,” the minister points out.

“Finland is well known for its green energy technologies. Here in Finland, we have been blessed by hard meteorological conditions and a lack of energy resources. This has compelled Finnish companies to be creative!”

The renewable energy sector offers significant investment potential in Finland, Paavo Väyrynen believes. He says, “Finland is well known for its green energy technologies. Here in Finland, we have been blessed by hard meteorological conditions and a lack of energy resources. This has compelled Finnish companies to be creative!”

Finland is known worldwide for its successful information and communications technology companies, including Nokia, as well as for its thriving enterprises in the mining, machine building and other sectors. “We are a small country and many of our companies have specialised to become really good at what they do,” Paavo Väyrynen points out.

The minister adds that Finnish companies should make efforts to work as partners. He explains, “With a few exceptions, Finnish companies are small from the global perspective, and so the more effectively we are able to benefit from one another’s strengths through cooperation, the better our possibilities are.”

Promoting wood construction worldwide

One example is for enterprises in Finland’s high potential wood industry to work together to help launch an extensive international programme for promoting wood construction. “Increasing wood usage is an effective tool for fighting climate change. A single cubic metre of wood can store about a tonne of carbon dioxide. According to calculations, a 10% increase in wood construction in the EU would account for 25% of the Kyoto emission targets,” Paavo Väyrynen says.

Minister Väyrynen believes that boosting wood construction would also have a substantial positive impact on the Finnish economy, for example by creating new opportunities for cooperation with Russia. “Energy efficiency, climate change and environmental issues are expected to emerge as guiding factors for Russian decision making. Russian authorities have already started paying attention to promoting wood construction in their programmes. A common interest will create vast opportunities for bilateral forestry cooperation and Finnish companies operating in Russia,” he believes.

Väyrynen spoke on Wednesday, 8 December at the publication of a report by the working group on promoting wood construction he appointed in the spring of 2010.