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Ex-PM Katainen blames Finland’s economic woes on big six-pack gov't

A government programmme that was too expansive is one of the factors behind Finland’s current economic malaise, says Former Finnish Prime Minister and current European Commission Vice President Jyrki Katainen. Katainen gave the thumbs-down review to the idea of a six-party government coalition Tuesday during an economic review before the Commission.

Euroopan parlamentti kuuli Jyrki Kataista Brysselissä tiistaina.
Euroopan parlamentti kuuli Jyrki Kataista Brysselissä tiistaina. Image: Emmanuel Dunand / AFP / Lehtikuva

Far from the political cross-currents swelling up in the prelude to the 2015 general election, former Finnish PM Jyrki Katainen gave his harshest evaluation yet of the six-party coalition government that he led up to June this year.

Now a European Commission VP, Katainen was brutally frank about the unwieldiness of the alliance, saying that it produced a government programme that proved to be too broad-based.

“Of course everyone understands that a six-party ensemble based on the will of the people – in other words the people voted for a parliament that offered no other alternative but a six-party government – would have difficulty accommodating all of their different values,” Katainen said during the commission hearing.

The ex-PM also said that there is no silver bullet to accelerate economic growth in the euro area.

“Investing in research and development, and competitive factors - prioritising investment overall,” was Katainen’s prescription to restore growth.

Finland and eurozone struggle in 2014

The EU vice president’s comments on the Finnish case came as the Commission lowered its 2014 growth forecasts for the EU to 1.3 percent, down from an estimated 1.6 percent outlined back in the spring of this year.

The forecast for the single-currency eurozone, of which Finland is a member, remained bleak however. The Commission pegged growth in the common-currency area at 0.8 percent for this year, revised down from 1.2 percent in a previous forecast.

According to Commission figures, Finland’s economy is set to be one of the worst-performing this year, second only to Cyprus. Finland is set to contract by 0.4 percent this year, according to the EU, with growth of just 0.6 percent in 2015.

Parties shy away from large coalition in 2015

Katainen’s comments are timely, as Finland’s political parties manoeuvre for position ahead of next year’s general election. With six months to go before the election, opinion polls have so far given no party a clear majority or a unambiguous mandate to govern – making another coalition almost a dead certainty in 2015.

However senior members of the main political parties appear to have no appetite for a broad coalition either. A straw poll of leading MPs last week showed that the general feeling was that the previous six-party set-up struggled to find common ground on important issues.

So far the National Coalition Party of which Katainen is a member appears to be losing steam in the run-up to the election.

An Yle public opinion poll released last week showed that the opposition Centre Party had sprinted past the NCP with 25.5 percent voter approval. The NCP trailed the Centre by six percentage points, with just 19.1 percent support.

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