Assessing the playing field on which his country must compete, Finnish Prime Minister Paavo Lipponen believes that recent international developments indicate that a new kind of global economy has emerged. "The phenomenon is largely due to worldwide utilization of modern communication and information technologies. In this, both Finland and Japan are the top countries.
 Finland can only look forward to brighter prospects as a culture of innovation stirs up world-class competitiveness in the industrial and business communities. |
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"Ten years ago it would have been quite surprising to find Finland listed as one of the world's most competitive economies, let alone hear it and Japan mentioned in the same sentence. Much has changed since then, and in the interim Finland has roared into the global marketplace," Lipponen continued.
As a small country, Finland has always been forced to look for new ways to be competitive. Its current success is all the more im-
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pressive because the entire country has a population of only 5 million people.
The prime minister added, "Due to rapid advances in information technology and communication systems, the relative importance of time and distance has changed. This has particularly affected Finland, which traditionally has been somewhat disadvantaged by its relatively remote location and the lack of opportunities to draw upon economies of scale. Therefore, the European economic integration process and full utilization of the benefits involved has become an integral part of our industrial strategy. We emphasize investment in human capital and R&D."
With an international corporate presence as leaders in industries ranging from telecommunications to forestry, Finnish companies now have an impact on the global economy that belies their country's small population. The Nordic country is, however, far from small geographically -- it is the seventh largest country in Europe, stretching to the northernmost edge of the continent.
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 Finnish Prime Minister Paavo Lipponen sees his country emerging as a global player. |
Led into the global arena by Nokia, the Finnish culture of innovation remains at the core of the success of many of its companies. Finland's powerful forestry industry has been able to profit from advances in automation to expand the reach and scope of its operations.
"The heart of our economy is our educational system," said Eva Riitta Siitonen, lord mayor of Helsinki. "By maintaining close links between the university system and corporations, we are able to constantly provide a fresh stream of ideas, keeping us on the cutting edge."
 Japan's ambassador to Finland, Norimasa Hasegawa, expects bilateral trade to grow even stronger.
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Whether it is a new microchip or a computer engineered saw blade, Finnish homegrown technology has placed its companies squarely in the ranks of the world's best performers. In 2001, R&D accounted for nearly half of all domestic capital outlays, totaling $3.9 billion -- a trend that is likely to continue. With various clusters of high-tech and wireless companies, the country boasts a strong, diverse knowledge base.
Finland is one of the strongest proponents of globalization. In the eyes of its prime minister, "The importance of regional integration has increased as globalization has intensified. Here, it is important to recognize and be willing to improve global governance at the same time. The introduction of the euro will mark a major milestone in this respect." Finland's adoption of the new common currency should reap benefits for the country; nearly 80 percent of production is exported.
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"I think that Finland has undergone remarkable changes in the past decade, and to a large extent we have to thank Nokia," commented Klaus Cawén, senior vice president of Kone Corporation. "We were always good at technology, but we had no idea of how to bring products to market. We had no idea how to sell. People have gained more self-confidence and courage, and we realize we are just like any other Europeans now. Finland has truly come into its own."
This newfound confidence and pride is seen in many companies, but perhaps most clearly at Nokia. Under the leadership of Matti Alahuhta, Nokia Mobile Phones is working hard to cement its position as the leading global supplier of mobile terminals. "As we have seen Finland partake in the growing integration of world markets, the growth of universal standards will enhance competition at both the global and regional levels," he said. "Clearly, as technology becomes standardized, economies of scale can be implemented and greater profit generated. As we watch Japan lead the way to the next 3G mobile phone technology, Nokia hopes to be present in a variety of service and product categories, reflecting the importance of this market."
No discussion of Finland would be complete without mention of its forestry resources. The forestry sector has served as the backbone of Finnish industry for years, and will likely continue to be for years to come.
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 Helsinki's Lord Mayor Eva Riitta Siitonen attributes the country's continuous growth to high quality education. |
Though forestry may be Finland's oldest and most traditional industry, it has now come to be one of the most hi-tech. New technologies have improved efficiency, environmental impact and the bottom line.
It is hard to imagine that the despite its dramatic impact on the world, Finland is a country of just 5 million people. From the forests to the offices, the innovative companies and industries of Finland are finding their way into all aspects of the global economy.
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