The Finnish economy is set to expand by 1.1 per cent in 2016, according to economists at OP Financial Group.The Finnish economy will grow slightly faster than expected this year, but the outlook for next year is undermined by several uncertainties, economists at OP Financial Group state in their latest economic review.

The economists expect the national economy to expand by 1.1 per cent in 2016, instead of the previously forecast 0.8 per cent.

The growth rate remains contingent on an upturn in investment activities and particularly on one in construction investments, according to the economic review. The recovery of export-oriented industries, on the other hand, is expected to be slow.

“It is fantastic that domestic markets are picking up steam. The outlook is unfortunately overshadowed by a number of risks and the sluggish development of exports,” Reijo Heiskanen, the chief economist at OP Financial Group, says in a press release.

He adds that the basis for the outlook for next year is increasingly unstable because the measures discussed as part of the ongoing negotiations over a competitiveness pact are set to provide less support to growth than initially estimated.

The national economy is to grow by 1.4 per cent in 2017, instead of the previously forecast 1.6 per cent, according to the review.

The economists also estimate that the short-term risks associated with economic development in the country arise from the implementation of economic policy and the pitfalls of export industries.

A prerequisite for the forecast is that the negotiations over a competitiveness pact yield the desired results and that the referendum on Britain's membership in the European Union does not inflict significant damage on the real economy over the next one-and-a-half years.

Aleksi Teivainen – HT
Photo: Aku Häyrynen – Lehtikuva
Source: Uusi Suomi