Short-term outlook for Finnish economy remains positive

Ministry of Finance said on Monday the short-term outlook for the Finnish economy remains positive despite bad economic news from elsewhere in the world.

The ministry predicted the Finnish economy will grow by 1.5 percent this year, slowing down to around one percent for the next a few years.

Mikko Spolander, Director General of the Economy Department of the Ministry of Finance, told the media that the one percent growth envisaged for the medium term "is not enough for the needs of the welfare state."

For that reason, measures seeking sustainable competitiveness and higher employment and productivity must figure high on the economic policy agenda, he said.

The role of public consumption and investment in gross domestic product (GDP) growth will be highlighted, especially in 2020. Spending increases envisaged in the program of the current left-center cabinet will boost consumption and investments, and contribute to maintaining domestic demand, the ministry noted.

The latest assessment of the outlook seems more positive than another one made by the Research Institute of the Finnish Economy (ETLA) last month.

ETLA had said that Finland's economic growth would slow down remarkably this year, with the country's GDP growing by 1.1 percent this year and by 0.9 percent next year.

According to the finance ministry, Finland's public finances suffer from a structural deficit, which is expected to grow over the next few years. However, the employment rate will edge up to 73.1 percent in 2023.