Finland

In-depth country-focused analysis on Finland's economic, political and operational risk environment, complemented by detailed sector insight

Finland

Our comprehensive assessment of Finland's operating environment and the outlook for its leading sectors are formed by bringing together a wealth of data on global markets that affect Finland, as well as the latest industry developments that could impact Finland's industries. This unique integrated approach has given us an impeccable track-record for predicting important shifts in the markets, ensuring you’re aware of the latest market opportunities and risks in Finland before your competitors.

Country Risk

Finland Country Risk

BMI View:

Core Views

  • Finland's economic malaise has much further to run, with the economy set to expand at the slowest rate in the EU in 2017.

  • We forecast real GDP growth to come in at just 0.4% in 2016 and 0.7% the following year. This suggests that the country will slide further behind regional peers Norway, Sweden and Denmark, and will be the slowest expanding EU economy in 2017

  • Reforms aimed at tackling Finland's uncompetitive labour market will be insufficient to solve severe structural inefficiencies in the economy.

  • Finland's coalition government will struggle to retain popular support in 2016 and 2017, due to the likely implementation of controversial labour market reforms.

  • While support for exiting the euro will grow, we remain sceptical that...

Finland Industry Coverage (18)

Autos

Finland Autos

BMI View:

Passenger Car and Light Commercial Vehicle Sales
(2013-2019)
f = BMI forecast. Source: Autoalan Tiedotuskesku, BMI

Key Views

  • Commercial vehicles are outperforming cars against a sluggish macroeconomic backdrop.

  • New model launches from leading players have lent some support to passenger car sales.

  • Finnish production will remain supported by output from the Valmet Automotive factory in Uusikaupunki

  • October 2015 first...

Food & Drink

Finland Food & Drink

BMI View:

BMI View: A consumer base with some of the strongest purchasing power in the world, combined with a favourable business and regulatory environment, will continue to be an attractive characteristic for food and drink companies operating in Scandinavia. That said, market concentration and a weak demographic outlook will limit growth for new entrants.

Latest Updates & Industry Developments

  • Throughout our forecast period to 2020, household spending will experience healthy growth in the Nordics, given...

Infrastructure

Finland Infrastructure

BMI View:

BMI View: Despite a government committed to developing key infrastructure, public spending will remain constrained by weak economic growth, which is being held back by external demand pressures and the fading of key domestic industries. Nevertheless, growth, both economic and in the construction sector, is turning positive and with it opportunities in buildings construction, transport infrastructure and energy projects. Construction growth in 2016 will come in at 0.4% with a sector value of EUR11.3bn (USD12.1bn).

Latest Updates And Structural Trends

  • Activity in Finland's construction industry is beginning to pick up, with building permits and starts steadily increasing over 2015 and is supportive of production volumes in 2016.

  • ...

Medical Devices

Finland Medical Devices

BMI View:

BMI View: We forecast a modest 2014-2019 US dollar CAGR of 1.8%, which is below the Western Europe average. Although the large and expanding elderly population would indicate a steady rise in medical device consumption, increasing financial pressures on the healthcare system and the relatively small population overall are likely to constrain future growth rates. While Finland has a history of high quality domestic production, the majority of output is exported leaving the domestic market heavily dependent on imported products.

Projected Medical Device Market, 2014-2019
Total (USDmn) Per Capita (USD) Total (...

Metals

Finland Metals

BMI View:

BMI View: We have increased our 2016 tin price forecast to USD16,500/tonne owing to a stabilisation in the Chinese economy over Q116 that has boosted all industrial metal prices significantly over January-April. While we expect consolidation over the remainder of 2016, tin prices will continue to recover beyond 2016 as the global market posts sustained market deficits and inventories dwindle.

Global - Tin Supply, Demand & Price Forecasts
2014 2015e 2016f ...

Finland Metals

BMI View:

BMI view: We have revised our aluminium price forecast from USD1,575/tonne to USD1,600/tonne in 2016, as the tightening market provided an earlier than expected floor in Q116. Aluminium prices will gradually edge higher as the global market moves into a deficit by 2018.

...
Global - Aluminium Supply, Demand & Price Forecasts
2014 2015e 2016f 2017f

Finland Metals

BMI View:

BMI View: Despite the strong H116 iron ore price rally, prices will edge lower due to weakening Chinese consumption over the latter half of 2016. From 2017 onwards, iron ore prices will remain subdued as iron ore prices remain under pressure from an over-supplied seaborne market, driven by strong production growth in Australia and Brazil, and weak consumption growth in China.

...
Global - Iron Ore Production Forecasts
2013 2014 2015e 2016f

Finland Metals

BMI View:

BMI View: Nickel prices will bottom in 2016 as weak production drags the global market into deficit. For instance, we expect Chinese imports of nickel to grow over the coming quarters. Prices will begin 2016 weaker than we had previously expected and we have thus revised down our 2016 average price forecast to USD9,000/tonne from USD10,500/tonne.

...
Global Nickel Forecasts
2013 2014 2015e

Finland Metals

BMI View:

BMI View: We have revised down our average copper price forecast for 2016 to USD4,900/tonne. We expect prices to find a floor over the first half of 2016, and begin to stabilise thereafter, supported by production cuts and modest consumption growth.

Global - Copper Supply, Demand & Price Forecasts
2014 2015e 2016f 2017f 2018f ...

Finland Metals

BMI View:

BMI View: We have raised our gold price forecast for 2016 to USD1,275/oz and have a new five-year price target of USD1,400/oz. We have turned more positive towards prices due to rising inflation pressures and our view that real rates will remain depressed in developed markets beyond 2016. A modest rise in prices will be insufficient to reverse the trend of weak mine investment and industry consolidation.

BMI Gold Forecasts
2014 2015 2016f ...

Finland Metals

BMI View:

BMI View: Global steel prices will remain subdued due to a persistent steel oversupply over the coming quarters. From 2017 onwards, steel prices will gradually edge higher as the global steel surplus will narrow due to Chinese supply moderation.

Steel Price Forecast
2014 2015 2016f 2017f 2018f 2019f...

Finland Metals

BMI View:

BMI View: We maintain our average zinc price forecast for 2016 of USD1,750/tonne. We expect zinc prices to reach a floor over the first half of 2016, and begin to stabilise thereafter, as production cuts shift the market to a deficit.

...
Global - Zinc Supply, Demand & Price Forecasts
2014 2015e 2016f 2017f 2018f

Finland Metals

BMI View:

BMI View: Lead prices will gradually edge higher as the global lead market will shift into deficit by 2017 as production growth will slow over the coming years.

...
BMI Lead Price Forecast
Current* 2016f 2017f 2018f 2019f 2020f

Pharmaceuticals & Healthcare

Finland Pharmaceuticals & Healthcare

BMI View:

BMI View: Innovative drugmaker revenues will remain under threat in Finland. The Finnish government is committed to containing rising healthcare costs and despite company concerns regarding falling drug prices, we believe the success of the annual decline in reimbursed medicine prices will result in the government maintaining the generic reference pricing system that is in place. Amplifying price pressures on patented medicines are the unsystematic price cuts on medicines, which are more disruptive to drugmaker revenue streams in Finland.

Headline Expenditure Projections

  • Pharmaceuticals: EUR2.85bn (USD3.82bn) in 2014 to EUR2.93bn (USD3.23bn) in 2015;+3.0% in local currency terms and -15.4% in US dollar terms. Forecast revised downwards from last quarter...

Power

Finland Power

BMI View:

BMI View: This quarter our fundamental assumptions for Sweden continue to be relevant. Taking into account relatively positive macroeconomic expectations for the Nordic region as well as sector trends, we continue to expect power consumption growth in 2016. Similarly, we maintain our long-held view that, while growth expectations in the region are improving, economic woes in the eurozone remain a major risk factor for the consumption and generation outlook of the country, as more regional instability...

Finland Power

BMI View:

BMI View: This quarter we have slightly revised our forecasts, as we expect coal-fired power to contract further as a result of Finnish plans to phase-down coal by the late 2020s. At the same time we have upgraded our forecast for biomass-fired power generation as we believe that it will form a key component of Finnish renewables strategy over the next decade, owing to the government's aim to restructure the country's forest-related industry - in order to adapt to a fall in demand for traditional forest-related products. This notwithstanding, we maintain our long-held view that, while growth expectations in the region are improving, economic woes in the eurozone remain a major risk factor for the consumption and generation outlook of the country, as more regional instability could undermine their economic activity.

...

Renewables

Finland Renewables

BMI View:

BMI View: We hold a relatively upbeat outlook for Finland's non-hydropower renewables segment, as strong political support for the biomass sector through the restructuring of the traditional forest-related industry, and potential for coal-to-biomass conversions due to a planned coal-phasedown, mean that the biomass sector will drive renewables growth. In contrast, investor interest in the wind sector will contract over the next years, as the government moves to curb costs in the segment by restricting access to the country's feed-in-tariff programme.

...
Renewables Headline Forecasts (Finland 2015-2021)

Telecommunications

Finland Telecommunications

BMI View:

BMI View : Finland has the highest penetration rate in Western Europe, as many users complement their usual mobile phone subscription with one specifically for mobile broadband. However, the Finnish government seeks to expedite the construction of communications and electricity networks with acts on shared construction and use of infrastructure. On November 12, the Finnish Ministry of Transport and Communications decided to implement an act covering sharing of networks and to revise the Information Society Code regarding networks within buildings. The acts are expected to be effective from July 1 2016. The government aims to slash the construction costs of high-speed broadband networks, by boosting collaboration among grid operators and to facilitate the development of digital services and functions.

...
Data Drives Demand
Mobile And 3G/4G Forecasts

Latest Finland Articles

  • With global growth continuing to stutter amid unconvincing growth performan...

  • A few key themes stand out when comparing BMI's forecasts against Bloomberg...

  • We have upgraded our oil price forecast this month with markets having pric...

Latest Finland Blogs

  • A loss of competitiveness, stagnant growth prospects, and the likelihood of...

  • BMI Research regularly carries out scenario analysis of 'low probability-hi...

Latest Finland Podcasts

  • Europe's 20-year telecoms competition initiative has benefited million...

  • The operating environment for energy firms in the European Union is ex...

  • Microsoft's purchase of Nokia's mobile phone division signifies that t...

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