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The economy is slowing markedly as exports weaken. Activity will be supported mainly by private consumption in 2012 on the back of firm wage growth and consumer confidence. The expected recovery in the global economy towards end-2012 should revive exports and investment, strengthening growth in 2013.

Finland has a relatively strong fiscal position, leaving room for letting the automatic stabilisers play in the event of lower-than-expected growth. Nevertheless, the rising burden of ageing calls for further reforms of the pension system and greater public sector efficiency, especially in health care. In the longer term, stronger competition in shielded private and public service sectors would boost productivity and growth.