Flag of Finland

Finland country brief

Overview

The Republic of Finland is the most sparsely populated country in the European Union with a population of 5.44 million (October 2013) spread over 338,145 square kilometres. The Åland Islands, off the south-western coast, are an autonomous, demilitarised administrative province of Finland. Under the Finnish Constitution, Finland is a bilingual country with Finnish and Swedish as official languages. The capital of Finland is Helsinki. Finland celebrates its National Day (Independence Day) on 6 December.

Political overview

System of Government

The Republic of Finland is a parliamentary democracy with a republican constitution. The unicameral parliament (Eduskunta) has 200 members directly elected from 15 multi-member constituencies every four years. 

Political developments

The current President is Mr Sauli Niinistö. Mr Niinistö was elected by popular vote on 5 February 2012 and took office on 1 March 2012. The next presidential elections will be held in approximately February 2018.

The current Finnish Coalition Government was formed on 22 June 2011 following elections on 17 April. The coalition comprises a majority of National Coalition Party and Social Democrats. The remainder of the coalition is composed of The Greens, Left Alliance, Swedish People's Party of Finland and the Christian Democrats. The True Finns and the Centre Party have formed the opposition. A member of the National Coalition Party, Mr Jyrki Katainen, is the current Prime Minister.  The next parliamentary elections will be held before the end of April 2015.

Foreign Policy

Following the collapse of the Soviet Union, Finland sought out new political and security structures. Finland became a member of the European Union in 1995, along with Sweden and Austria, and was one of the first EU countries to join the euro zone in 1999. Finland supports development of the EU's European Security and Defence Policy and is a non-NATO contributor to the International Security Assistance Force in Afghanistan.

Economic overview

Finland’s economy has been more resilient than those of many other European countries to the euro area’s economic and debt crises.  It is one of only three euro zone countries to have maintained its triple-A credit rating throughout the crisis. Nonetheless, Finland experienced a real GDP contraction of 0.2 per cent in 2012.  The downturn eased by the end of 2013 but the forecast for growth in 2014 remains low at 1.5 per cent.  Unemployment was at 7.6 per cent in September 2013, up from 7.1 per cent in 2012. 

Finland has few natural energy resources. Nuclear power currently supplies almost 30 per cent of Finland’s electricity. The Finnish Parliament approved the construction of three new nuclear reactors (Finland currently has four reactors) in order to meet increasing energy demand and reduce carbon emissions. Work on the fifth reactor, on Olkiluoto Island, started in 2005 but has experienced considerable delays and cost overrun and is not expected to go online until 2016. Parliament approved plans to build the sixth and seventh reactors in July 2010 but construction has not yet commenced. Finland's other energy options include increased use of natural gas and electricity imported from Russia. Renewable energy sources account for around 25 per cent of Finland's energy mix.

Bilateral relationship

Australia and Finland share warm bilateral relations, underpinned by strong people-to-people links through the sizeable Finnish community in Australia. The 1920s and 1950s saw the main migration waves from Finland to Australia. In the 2011 census, 22, 420 people in Australia claimed Finnish ancestry.

Australia established diplomatic relations with Finland in 1949. Australia has non-resident accreditation to Finland from its embassy in Stockholm, Sweden, and also has a consulate in Helsinki. Finland has an embassy in Canberra and consulates in all states and the Northern Territory.

Australia and Finland signed a bilateral social security agreement on 10 September 2008, which came into force on 1 July 2009. The agreement provides improved social security protection to people who have lived or worked in both Australia and Finland. Other agreements between Australia and Finland include a Working Holiday Maker Arrangement and a Double Taxation Agreement.

High-level visits

High-level visits are important for promoting cooperation and understanding between Finland and Australia. The Finnish Minister for European Affairs and International Trade, Dr Alexander Stubb, led a business mission to Australia and met with Foreign Minister the Hon Julie Bishop MP in December 2013. The Hon Brendan O’Connor MP, then-Minister for Small Business, Minister for Housing and Minister for Homelessness, visited Finland on 5-6 August 2012.  The Hon Kevin Rudd visited Helsinki as Foreign Minister on 16 and 17 May 2011 for the UN High-level Panel on Global Sustainability. Then-President Tarja Halonen visited Australia in January 2007. Other high level visits include: then Minister for Finance, Mr Eero Heinäluoma (November 2006); a Parliamentary delegation led by then-Parliament Speaker, Mr Paavo Lipponen (March 2005); and the Minister for Trade and Industry, Mr Mauri Pekkarinen who was accompanied by a business delegation (April 2004).

Bilateral economic and trade relationship

Total two-way merchandise trade between Australia and Finland in 2012 was A$1.162 billion (our 37th largest merchandise trade partner). Australia's exports to Finland in 2012 totalled A$240 million including coal, nickel ores and concentrates, alcoholic beverages and plastic articles. Finland's exports to Australia in 2012 totalled A$922 million, and included civil engineering equipment and parts, paper and paperboard, specialised machinery and parts, and mechanical handling equipment and parts.

For information on doing business in Finland, please see Austrade’s website.

Updated December 2013