Economy in Finland

Country Data Finland

Finland is a Northern European country with Helsinki as its capital and Finnish and Swedish as its official languages within the European Union. It has been an EU member since 1 January 1995 and adopted the euro in 1999, becoming part of the euro area from its early years. Finland also belongs to the Schengen area, which it joined in 2001, enabling passport-free travel across participating European states. Key indicators such as geographic size, population, and GDP per capita measured in purchasing power standards underline Finland’s high level of economic development and strong living standards within the EU.

Finland is organised as a parliamentary republic. Executive authority is shared between the prime minister, who leads the government, and the president, who serves as head of state. National administration is centred in Helsinki, while local governance is carried out through 309 municipalities, including cities and towns. Administratively, the country is divided into 19 regions and 70 sub-regions. The Åland Islands form an autonomous region in the southwest with extensive self-governing powers, while northern Finland includes the Sami Domicile Area in Lapland, home to a significant share of Finland’s indigenous Sami population.

Finland’s economy is diversified and knowledge-driven. In 2020, industrial activity accounted for a substantial share of economic output, alongside public administration, defence, education, healthcare, and social services. Wholesale and retail trade, transport, accommodation, and food services also played an important role. Finland’s trade is closely linked to the European Union, which absorbs more than half of Finnish exports. Germany, Sweden, and the Netherlands are the most important export destinations within the EU, while the United States and China are key markets outside Europe. Imports show a similar pattern, with most goods sourced from EU member states—particularly Germany, Sweden, and the Netherlands—while Russia and China remain notable non-EU suppliers.

Within the European Union, Finland is represented by 14 Members of the European Parliament and takes an active role in EU decision-making. Finnish government representatives regularly participate in meetings of the Council of the EU, contributing to the adoption of legislation and the coordination of policies across a wide range of areas. Finland has held the rotating Presidency of the Council of the EU on three occasions, most recently in the second half of 2019, reflecting its ongoing engagement in shaping EU priorities.

At the European Commission level, Finland is represented by a nominated Commissioner, most recently responsible for International Partnerships, and the Commission maintains an official representation in the country. Finland also participates in the EU’s advisory bodies, with nine representatives each on the European Economic and Social Committee and the European Committee of the Regions, ensuring that social, economic, and regional interests are reflected in EU policymaking.

Finland maintains a permanent representation to the European Union in Brussels, which serves as the main channel for interaction with EU institutions and for advancing national positions within the EU framework. As a member state with a strong economy, Finland contributes to the EU budget in proportion to its economic capacity. These contributions support EU-wide programmes and projects that promote cohesion, innovation, sustainability, and economic development across all member states, reflecting the EU budget’s focus on shared European priorities.