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GDP growth stalls in Q1

30 May 2019, 00:12 ( 1 Month ago)

DF News Desk
Photo Lapland Material Bank by Terhi Tuovinen.

Finnish economy slowed down more than expected during the first quarter (Q1) of 2019, growing only 0.2 percent compared with 1.2 percent in the same period in 2018, news agency Xinhua reported quoting Statistics Finland on Wednesday.

Exports and public sector spending grew in Q1, but private spending and imports declined.

The data came during the final days of preparing the program for the upcoming coalition government. 

The government program and the financing of a rising spending reportedly rely on increased tax revenue.

The likely prime minister Antti Rinne said the government would be pursuing "counter-cyclical economic policy" if the economy worsens.

Such policy would mean that growth of public spending would not be curbed even if the economy stalls.

Olli Karkkainen, an economist of the Nordea Bank, said Finland is entering an era of slower growth. "If the new cabinet increases consumption taxation, it could hamper consumers more. But increases in welfare payments could accelerate it," he told national broadcaster Yle.

Aino Silvo, an economist of the Bank of Finland, noted on social media that this is indeed "the right time to launch public transport infrastructure projects."