Anders Borg, a former Swedish Minister of Finance, gave a preview last Monday of what to expect from his anticipated assessment of the Finnish economy.
Finland, he said, must pursue further wage moderation and greater productivity, or else the jobs created by the expansion of the global economy will sprout in countries such as Germany, Sweden and China.
Borg cautioned that the high income level of Finns is already gnawing away at the capacity of the country to compete for jobs in international markets. True to his background as a politician, he also conceded that it would be futile to propose any dramatic measures. "Lowering wages is simply not realistic in modern-day society," he said. "Our confidence in the Nordic welfare state is our premise. The key question is how to bring that to the modern age."
The Office of the Prime Minister in October asked Borg to compile a report outlining the key economic challenges faced by Finland in the future.
Accusations of stagnation
The report has already come under some criticism due to the affiliation of Borg with what is essentially the Swedish equivalent of the National Coalition Party. Juhana Vartiainen, the co-author of the report and the director general of the Government Institute for Economic Research (VATT), in turn, has accused the Social Democratic Party of stagnation, despite his background in the party.
"It's our task to be economic experts. Political decision-making will be left to others," Borg commented on the political dimension of the report.
On Monday Borg allowed Vartiainen and Björn Wahlroos, the chairman of the board of directors at Sampo, to deliver the more biting assessments of the Finnish economy as the trio participated in an economic seminar at the Hanken School of Economics in Helsinki.
One of the strengths of Finland, according to Borg, is that policy-makers have traditionally had the courage to base their decisions on economic facts. Vartiainen appeared less certain in that respect. Wahlroos, in turn, questioned the view of Borg that Finland should refrain from immediate and major tax cuts by asking: How do we then create new jobs?
Borg and Vartiainen are to present their report to the Government in March, one month before the parliamentary elections.
Tuomas Niskakangas – HS
Aleksi Teivainen – HT
© HELSINGIN SANOMAT
LEHTIKUVA/ Jarno Mela
