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OECD: Finland must cut red tape to attract more foreign investment, workers

The economic group said Finland was falling behind its Nordic neighbours in attracting investment and skilled labour.

Tyhjähkö Aleksanterinkatu Helsingissä aikaisin aamulla.
File photo of Aleksanterinkatu, Helsinki's High Street equivalent, where foreign investors have bought up valuable properties. Image: Matti Myller / Yle

Finland has consistently lagged behind other Nordic and Baltic nations in attracting foreign direct investment (FDI), according to a report published by the economic and trade organisation OECD.

The Finnish economy's inward FDI stock was 31 percent of gross domestic product (GDP) in 2019, significantly lower than the average of 49 percent for the other countries in the region.

The report predicted that investment in Finland will continue to decline as a result of the coronavirus pandemic, even though foreign investors could bring new vitality to the Finnish economy as it strives to recover from the crisis.

The authors also set out a list of key challenges that may be preventing Finland from "exploiting its full potential as a destination" for FDI.

The All Points North podcast reported on the long queues at the Finnish Immigration Service Migri. You can listen to the episode via this embedded player, via Yle Areena, on Spotify or via your favoured podcast provider.

Story continues after audio.

"Setting up a business takes longer in Finland than in other countries in the region, and foreign investors have limited access to online company registration. Long processing times of operational permits slow down, or undermine, investment projects," the report stated.

The report's authors also called on Finnish authorities to streamline the process of setting up companies as well as other permit-related and bureaucratic processes.

"Recruiting and retaining skilled foreign workers could be further facilitated by simplifying the residence permit system and fast-tracking work-based permits for post-graduate students and researchers," the report said.

Productivity and competitiveness would also be increased by removing barriers to competition in the ICT, transport and logistics sectors, the report concluded.

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