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Finnish economy spurts by nearly 4%

The economy is poised to outpace that of the overall eurozone this year, likely raising employment and wages.

Jouluvaloja Aleksanterinkadulla Helsingissä
Helsinki shopping street Aleksanterinkatu in December. Image: Antti Kolppo / Yle

The Finnish economy grew briskly in late 2017, according to figures issued Wednesday. The central statistics office says that gross domestic product (GDP) in the fourth quarter was up by 3.9 percent compared to a year earlier.

Statistics Finland estimated December’s year-on-year growth at 3.6 percent while upgrading its previous estimate for November from 3.5 to 4.3 percent.

These are the strongest indicators yet of the economy’s recovery from nearly 10 years of stagnation.

The agency also says that the number of employed people rose by around three percent in December, while retail sales edged up by 2.6 percent.

Finland's GDP rose in the last three months of the year by 1.1 percent compared to the previous quarter. Statistics Finland believes that GDP grew by around 3 percent in 2017 as a whole, about the same as in the eurozone as a whole.

Employment and wages set to improve

However the chief economist of Danske Bank’s Finnish branch, Pasi Kuoppamäki, estimated that overall growth for last year may have been as high as 3.2 or 3.3 percent. Kuoppamäki points out that the growth rate accelerated steadily throughout last year.

This year, the European Commission expects Finland’s growth to outpace that of the overall eurozone, rising to 3.3 percent while the 19-country zone as a whole is projected to grow by 2.2 percent.

Another Danske Bank economist, Jukka Appelqvist, says that the outlook for the real economy are excellent, with growth in output bolstering employment and wages, reinforced by strong domestic demand and brisk exports. However Appelqvist expects growth and exports to slow before too long.

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