Finnish Finance Ministry forecasts zero GDP growth this year
Updated Jun 16, 2023
The Finnish Ministry of Finance has predicted the country gross domestic product (GDP) would not grow this year.
Economic growth is blocked by the increase in prices and interest rates, which has slowed household consumption and private investment, said the Ministry.
The Finnish economy is projected to grow by 1.4 per cent in 2024 and 1.9 per cent in 2025.
The Ministry's forecast was a slight upgrade from March when it predicted that the Finnish economy would shrink 0.2 per cent this year and grow 1.3 per cent in 2024.
In other recent predictions, the Finnish OP Group, the country's biggest financial group, in May had predicted a 0.8 per cent decline this year and 0.3 growth in 2024.
The Ministry said that growth will be facilitated by slower inflation and the rise of salaries, which will improve the purchasing power of households.
Growth will also be supported by investments related to the green transition investments.
Foreign trade has a positive impact on growth, with exports increasing and imports decreasing to a significant degree, it added.