Economic recession in Finland easing

HELSINKI, Aug. 20 (Xinhua) — The economic recession in Finland is easing, with a steady recovery anticipated throughout 2024. Even stronger growth is projected for 2025, according to the latest forecast published on Tuesday by OP Financial Group.
OP’s economists expect Finland’s GDP to decline by 0.5 percent this year, before rebounding with 2.0 percent growth in 2025.
Chief Economist Reijo Heiskanen noted mixed economic signals, highlighting stronger-than-expected growth in the first half of the year despite a sluggish export market recovery. Finland’s economy is set to gain momentum in 2025, supported by lower interest rates and improving exports, although growth is expected to slow to 1.3 percent in 2026.
The export sector is recovering after earlier setbacks, and residential construction is beginning to rebound from the impact of rising interest rates. Consumer spending is expected to grow next year despite an inflation increase to around 2 percent, driven by higher real incomes.
The labor market is stabilizing, with employment expected to rise to new highs by 2026, although the employment rate may not surpass its 2022 peak due to a growing working-age population. Finland’s public deficit, currently at its highest level, is expected to decrease gradually, stabilizing near its structural level by 2026. ■