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DE LA VILLE ROME There is no better place to begin your Eternal City experience than InterContinental De La Ville Rome. Designed by the noted Hungarian architect Joseph Vago and located at the top of the renowned Spanish Steps, InterContinental De La Ville Rome is the mark of elegance and sophistication amidst ancient charm.


Finland Introduction • Ancient Northern Land with Very International Perspectives 4 • Strategic Trade Hub Focuses on Innovation 6 • Finland’s Fact File 8

Business & investment opportunities • Continued Focus on Innovation to Stimulate Economic Growth 11 • Roschier 13 • Ministry Keeping Economic Growth on Track 14 • Bringing Finnish Innovation to New Markets 17 • Sitra 19 • BioFund 20

Finance • Minister of Finance Calls for Fiscal Consolidation 22 • Municipality Finance plc 24 • Strong Supervision Bringing Financial Sector through Crisis 25 • Helsinki Stock Exchange a Top Performer in 2010 27

Energy & Sustainability • Cutting-Edge Energy Sector Open to International Partnerships 30 • Open Energy Market Continues to Attract Investment 32 • Ensuring Adequate Electricity Supplies for the Future 33 • Sitra 34 • Ensto Finland Oy 37 • RAO Nordic Oy 38 • Investing in Clean Energy Initiatives 40 • Moventas 42 • Greenstream 43 • MHG Systems 44

• Preseco Oy • L&T Recoil

45 46

Construction & Infrastructure • Keeping Construction Industry Globally Competitive 48 • Glaston Corporation 50 • Walki Group 51

Education • Excellence in Education Helps Give Finland Its Competitive Edge 53 • University of Helsinki 55 • Finnish Students Ranked World’s best on OECD Tests 56 • Top 10 Reasons for Finnish Schools’ Success Story 58

Communication • Digital Finland 2020 61 • Communications Sector Forging Information Society 63

Transport • Foreign Trade Minister Cites Finland’s Strong Fundamentals 66 • Intelligent Transport Positioning Finland as Logistics Hub 68 • Modern, Multi-Modal Transport Infrastructure 70 • Finnish Expertise in Container Shipping 72 • Containerships Oy 74 • Arctia Shipping 75

Tourism • New Tourism Development Strategy for 2020 • Hotel Helka • Authentically Finnish Attractions • Hertz

77 79 80 82

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Ancient Northern Land with Very International Perspectives


Finland is a northern land marked by its climate and strategic location. The cycle of the year in Finland features huge contrasts, from the “White Nights” of summer during which the sun never sets for around 10 weeks, to long winters when the dramatic “Northern Lights” can be seen. Finland’s wild northern landscape inspired the country’s greatest composer, Jean Sibelius, whose work came to symbolise Finland’s struggle for independence in the early 20th century after centuries under the domination of its neighbours.


Today, though located at the northern edge of Europe, Finland has developed a scientifically, artistically and technologically creative culture with a very international focus. Modern Finland is known for its high quality architecture, innovative design, original music and diverse high tech industries.

Long history leading to independence The first inhabitants of Finland were the Sami (Lapp) people. When Finnish speakers migrated to Finland in the first millennium BC, the Sami were forced to move


northward to the arctic regions, with which they are traditionally associated today. Finnish raids on the Scandinavian coast impelled Eric IX, the Swedish king, to conquer Finland in 1157, when it became part of the Swedish kingdom and converted to Christianity. In 1809, Finland was conquered again, this time by Alexander I of Russia, who set up Finland as a grand duchy. Under Russian rule until 1914, Finland lost its political autonomy and Russian became the country’s official language. When Russia became threatened by the March Revolution of 1917, Finland seized the opportunity to declare independence on December 6, 1917. The USSR attacked Finland on November 30, 1939, after Finland’s government refused to give in to Soviet territorial demands. The Finns staged a strong defence for three months before being forced to cede 41,440 sq km of land to Soviet rule. Under German pressure, Finland joined the Nazis against the USSR in 1941, but was defeated again and forced to cede the Petsamo area to the USSR. In 1948, Finland and Russia signed a treaty of friendship and mutual assistance, although Finland continued to pursue a foreign policy of nonalignment throughout the Cold War period. The friendship treaty officially ended in 1991, but hundreds of years of first Swedish and then Russian control have given Finland a distinctive blend of Scandinavian and Russian style and culture.

Economic transformation in latter half of 20th century

Helsinki Cathedral

of Finland’s modern welfare state are a high standard of education, equality promotion, and a national social security system. These features are currently being challenged, however, by an aging population and the fluctuations of an export driven economy.

Focus on education, training and research Finland’s rapid development since the end of the Cold War has been fuelled by its significant government spending on education, training and research. In fact, Finland is known to have one of the best educated and trained workforces in the world. In 2009, the Organisation for Economic Cooperation and Development (OECD) released the results of its latest Programme for International Student Assessment (PISA) survey which tests 15 year olds in reading, math and science; Finland, along with Korea, scored the highest of any OECD countries in the world.

In the latter half of the 20th century, Finland made a remarkable transformation from an agricultural and forest based economy to a diversified, modern, industrial one; Finland’s per capita income is now among the highest in Western Europe.

Finland’s emphasis on education has been a key factor in its development of a modern, competitive economy in which a cutting-edge telecommunications sector has been added to the traditional timber and metals industries.

Running on a platform to revitalise the economy, Martti Ahtisaari, a Social Democrat, won the country’s first direct presidential election in a runoff in 1994, and Finland became a member of the EU the following year. In 2000, Tarja Halonen, who had been Finland’s foreign minister, became its first female president.

Turku: World Culture Capital in 2011

Only Nordic state to adopt euro in 1999 Finland was the only Nordic state to join the euro system at its initiation in January 1999, a reflection of the country’s determination to forge stronger ties with the rest of Europe. In the 21st century, the key features

The city of Turku in south-western Finland reflects the country’s forward thinking approach to culture and economic development. Turku has been chosen as one of two European Capitals of Culture in 2011 (along with Tallinn, Estonia), and during the year Turku aims to focus on the connection between wellness, science and culture. With the motto “Culture Does You Good”, the Finnish city, which was founded in 1229, is set to host 155 cultural projects over the year. While honouring its long history, Finland has become a dynamic modern nation which continues to evolve.



Strategic Trade Hub Focuses on Innovation Finland’s official name in English is the Republic of Finland; in Finnish, the name is Suomen tasavalta/ Republiken Finland, or Suomi/ Finland as the short form.

Strategic location A trade hub for centuries, Finland is strategically located in Northern Europe between Sweden and Russia, with a 1,250 km coastline on the Baltic Sea, the Gulf of Bothnia, and the Gulf of Finland. Covering a total area of 338,145 sq km, of which 303,815 sq km is land and 34,330 sq km is water, Finland borders Norway (sharing a 727 km border), Sweden (614 km) and Russia, with which it shares a long 1,313 km border. Finland’s capital, Helsinki, is the farthest north of any European capital. In 2012, it will celebrate its 200th anniversary as a capital city.

Comparatively mild climate Finland’s climate, while potentially subarctic, is comparatively mild because of the moderating influence of the North Atlantic Current, the Baltic Sea, and more than 60,000 lakes. The country’s terrain is primarily low, flat to rolling plains interspersed with lakes and low hills. Its lowest point is the Baltic Sea and the highest is Haltiatunturi, at 1,328 m. Finland’s primary natural resources are timber, iron ore, copper, lead, zinc, chromite, nickel, gold, silver


and limestone. Around 6.5% of the country’s land area is considered arable land. Concerning environmental protection, Finland faces air pollution from manufacturing and power plants, which is contributing to acid rain; water pollution from industrial wastes and agricultural chemicals; and habitat loss threatening wildlife populations. Finland is working to combat these problems, and is a signatory of various international environmental agreements, including the Climate ChangeKyoto Protocol, the Desertification Act, the Endangered Species Act, the Law of the Sea, and the international Environmental Modification, Hazardous Wastes, Marine Dumping, Marine Life Conservation, Ozone Layer Protection, Ship Pollution, Tropical Timber 83, Tropical Timber 94, Wetlands and Whaling laws, among others.

Population primarily in urban areas Finland’s population of 5.2 million is concentrated on the small south-western coastal plain where Helsinki is located; around 63% of the country’s total population lives in urban areas. Around 66% of the population is between the ages of 15 and 64, with a median age of 42.3 years. Finland’s ethnic groups are Finns (93.4%), Swedes (5.6%), Russians (0.5%), Estonians (0.3%), Romas (Gypsy, 0.1%), and Samis (0.1%). The chief religion is the Lutheran Church of Finland, to which 82.5% of the population belongs. Finland’s official languages are Finnish (spoken by 91.2% of the population) and Swedish (spoken by 5.5%); Finland also has small Sami- and Russianspeaking minorities.


An independent republic since 1917 Independent from Russia since 1917, Finland is a republic divided into 20 official regions, or maakunta (in Finnish). Its national holiday is Independence Day, December 6. Finland’s constitution, which dates from March 2000, is based on Swedish civil law. Finland accepts compulsory ICJ jurisdiction with reservations. The chief of state is the president, currently Tarja Halonen (since March 2000). The head of government is the Prime Minister, currently Mari Kiviniemi (since June 2010); the Deputy Prime Minister is currently Jyrki Katainen (since April 2007), who is also Minister of Finance. Finland’s cabinet is the Council of State or Valtioneuvosto, appointed by the President and responsible to Parliament. Presidents are elected by popular vote to serve a six-year term; the next presidential elections will be held in January 2012. Finland’s parliament, or Eduskunta, is made up of 200 seats, with members elected by popular vote to serve four-year terms. The next parliamentary elections will be held in March 2011. The judicial branch of government is made up of general courts and a Supreme Court, or Korkein Oikeus, whose judges are appointed by the President.

Productive member of EU and international communities Finland joined the European Union in 1995 and is committed to serving as a productive member of the European and international communities. It participates in the World Trade Organisation (WTO), the World Health Organisation (WHO), the Paris Club, the European Bank

Parliament House

for Research and Development (EBRD), the European Investment Bank, Interpol, the Organisation of Economic Cooperation and Development (OECD), the United Nations, the Schengen Convention, the United Nations Educational, Scientific and Cultural Organisation (UNESCO), and other international organisations.

Helsinki World Design Capital 2012 Long known for its innovative design activities, Helsinki has been chosen World Design Capital for 2012 by the

International Council of Societies of Industrial Design (Icsid). As Icsid points out, “Design is manifest in the everyday lives of Helsinki citizens in many ways, ranging from home furniture and items that represent old Finnish design traditions to modern urban solutions in the city and contemporary interior design. The creative sector is re-shaping Helsinki’s economy and enhancing quality of life for the city’s residents.” As Helsinki’s designation as an international design capital demonstrates, Finland is an ancient land at the northern edge of Europe which has developed a very modern and creative culture.



Finland’s Fact File



5.3 million, 15.7 inhabitants per km2 (40.2 per square mile)

Parliament: Cabinet:

200 members in one chamber, elected every 4 years in a direct vote Multiparty coalition cabinet. The current Cabinet is run by Prime Minister Mari Kiviniemi 

Head of State:

President of the Republic, elected every 6 years, two-term maximum. Currently Ms Tarja Halonen, first elected in 2000

Life expectancy: Men 76 years, women 83 years Languages:

Official languages are Finnish (spoken by 91%) and Swedish (5.4%). Sámi is the mother tongue of about 1,700 people, members of the indigenous Sámi people of northern Lapland


80.7% Lutheran and about 1.1% Orthodox. In practice society is fairly secularised

State & Government Independence:


Declared on December 6, 1917. Previously a grand duchy in the Russian empire for 108 years, and a part of Sweden for 600 years before that

Form of government:

Parliamentary democracy

International cooperation:

Member of United Nations since 1955 and European Union since 1995

Society & Economy Key features:

High standard of education, social security and healthcare, all financed by the state

GDP per capita: 34,769 euros Currency unit:


Introduction Exports - commodities: Electrical and optical equipment, machinery, transport equipment, paper and pulp, chemicals, basic metals; timber Exports - partners: Germany 10.32%, Sweden 9.79%, Russia 9%, US 7.85%, Netherlands 5.9%, UK 5.24%, China 4.1% (2009) Imports - commodities: Foodstuffs, petroleum and petroleum products, chemicals,transport equipment, iron and steel, machinery, textile yarn and fabrics, grains Imports - partners: Russia 16.28%, Germany 15.76%, Sweden 14.65%, Netherlands 6.99%, China 5.29%, France 4.22% (2009) Consumer confidence: 13.5 (12/10) Cost-of-living index: 1,777 (12/10) Inflation:

2.9% (12/10)

Industrial output: 6.2% (11/10) Unemployment: 7.1% (11/10) Volume of GDP:

5.5% (10/10)

Geography & Climate Area:

338,424 km² (131,985 square miles), the fifth-largest country in Western Europe

Greatest length from north to south:

1,160 km (720 miles)

Greatest width from east to west: 540 km (335 mi) Capital:

Helsinki (1.25 million inhabitants in metropolitan area)


Great contrasts – cold winters and fairly warm summers


• Continued Focus on Innovation to Stimulate Economic Growth • Ministry Keeping Economic Growth on Track • Bringing Finnish Innovation to New Markets

Business & Investment Oppertunities

“Finland clearly has many strengths that can create new opportunities.” Mauri Pekkarinen, Minister of Economic Affairs

Business & Investment Opportunities

Continued Focus on Innovation to Stimulate Economic Growth Finland was named the second most competitive economy in the world in the World Economic Forum’s latest “Global Competitiveness Report”, and it is also ranked high in economic freedom and recognised as being one of the world’s most innovative countries.

High score in economic freedom Finland scored 73.8 in the 2010 Index of Economic Freedom, making its economy the 17th freest in the index for the year. Finland is ranked eighth in economic freedom out of 43 countries in the Europe region, and its overall score is well above the world average. As the 2010 Index of Economic Freedom points out, “The modern and competitive Finnish economy has long benefited from high levels of economic freedom. The economy remains a world leader in business freedom, trade freedom, property rights, and freedom from corruption. Private enterprises continue to blossom and promote innovation in an efficient regulatory and legal environment. With prudent and sound banking practices, the financial sector has weathered the global financial turbulence relatively well.”

National policy promotes innovation Innovation, in fact, has driven the modern Finnish economy forward

Tampere Town Hall

and led to the global recognition of Finnish brands in cutting-edge fields. Finland’s national innovation system comprises the producers and users of new information and knowledge and the various ways in which they interact. As the Finnish Science and Technology Information Service points out, “At the core of Finland’s innovation system are education, research and product development, and knowledge intensive business and industry. Varied international cooperation is a feature running through the system.” Thanks to its focus on innovation, Finland now has a highly industrialised, largely free market economy with a per capita GDP of around

€25,701 in 2009, placing Finland 37th in the world. Finland’s purchasing power parity GDP is ranked 56th in the world, totalling around €135.2 billion in 2009 following the previous year’s total of €147 billion. Finland’s leading industries at present are metals and metal products, electronics, machinery and scientific instruments, shipbuilding, pulp and paper, foodstuffs, chemicals, textiles, and clothing.

Exports account for over one third of GDP Trade plays a major role in Finland’s economy, with exports



®Jaak Kadak |

accounting for over one third of GDP. Finland is globally competitive in manufacturing, particularly in the wood, metals, engineering, telecommunications, and electronics industries. Finland is well known for its expertise in high tech exports such as mobile telephones; Nokia is a global leader in this field. The forestry sector is another important export earner. Finland’s exports totalled €47.3 billion in 2009, a drop from the 2008 total of €73.26 billion. Finland’s main export commodities are electrical and optical equipment, machinery, transport equipment, paper and pulp, chemicals, basic metals and timber. Its top export markets are Germany, accounting for 10.32% of total exports in 2009; Sweden (9.79%); Russia (9%); the US (7.85%); the Netherlands (5.9%); the UK (5.24%); and China (4.1%). Finland depends on imports of raw materials, energy, and some components for manufactured goods. Finland’s imports in 2009 totalled €43.6 billion, a drop from the 2008 total of €65.54 billion. Leading imports in 2009 were food products, petroleum and petroleum products, chemicals, transport equipment, iron and steel, machinery, textile


yarn and fabrics, and grains. The main sources of Finland’s imports are Russia, accounting for 16.28% of the total in 2009; Germany (15.76%); Sweden (14.65%); the Netherlands (6.99%); China (5.29%); and France (4.22%).

Services dominate economy Finland’s GDP is dominated by services, accounting for 69% of the total in 2009, followed by industry (28.2%) and agriculture (2.7%). Public services employ 32.7% of Finland’s labour force while the industrial sector employs 18.2%, commerce 15.9%, financial services (including insurance and business services) 14.5%, transport and communications 6.9%, the construction industry 7.3%, and agriculture and forestry 4.5%. Finland’s unemployment rate reached 8.2% in 2009. Finland had been one of the best performing economies in the EU in recent years and its banks and financial markets avoided the worst effects of the global financial crisis, but the country’s exportoriented economy was hit hard overall. Finland

Business & Investment Opportunities

experienced one of the most severe economic contractions in the euro zone in 2009; its GDP fell to around -8.1% that year and its industrial production growth rate fell to around -16.3%. The slowdown of construction, other investment, and exports has also caused unemployment to rise.

Recovering from global crisis The economy is beginning to recover, however. On December 20, 2010, Finland’s Ministry of Finance raised its 2010 growth projection for the economy to 3.2% from 2.1%, citing a faster than expected recovery in global trade. The growth projection for 2011 was kept unchanged at 2.9%, while that for 2012 was slightly raised to 2.7%. Meanwhile the ministry noted that inflation is expected to rise to 2.4% in 2011 from a little over 2% in 2010, mainly due to tax changes and higher commodity prices. The recession has had a profound effect on Finland’s government finances and debt ratio, having turned previously strong public finances into deficit in only a year. To return the Finnish economy to health, the country’s leaders have developed a post recession strategy in which measures supporting growth will be combined with general government adjustment measures. Longer term challenges include a rapidly aging population and decreasing productivity.

Renewable energy, “clean tech” targeted for growth The government aims to promote new economic activities along with Finland’s traditional growth leaders. Renewable energy and clean technologies are sectors which have been targeted for significant development. Given Finland’s proven expertise in the energy sector and its commitment to innovation, research and development, and new technologies, the country seems well placed to achieve success in these new fields. Finland continues to attract foreign investment, largely thanks to its highly qualified workforce and strategic location as a bridge between the Nordic region, Russia, and Central and Eastern Europe. Total FDI reached €64.7 billion in 2009, even as the global recession took its toll. Having built the right foundations for economic prosperity, Finland is expected to weather the current recession and return to strong growth in the future.

Roschier Award-Winning Law Firm Known for Exceptional Service Roschier, ranked Finland’s number one law firm, was once again recognised as the clear leader among the country’s top law firms in 2010. In the independent Commercial Law Survey by TSN Sifo Prospera, clients ranked Roschier the best in business mindedness, large project capacity and skillfulness of its lawyers. The firm also won the ILO Client Choice Award, and for the fifth consecutive year, the Who’s Who Legal Award for Finland. “Close relationships with our clients are key to our success. We are also very flexible when it comes to adapting to market trends and client needs,” Managing Partner Ulf-Henrik Kull explains. “When Stockholm was developing into the hub for the region, we were the first local firm to set up an office there.” Roschier is part of the RR Alliance, an integrated crossborder cooperation of leading law firms throughout the Nordic and Baltic region. Typical Roschier clients include investors in major infrastructure and energy projects, leading international corporations, municipalities, and government agencies.

Competitive edge: highly specialised expertise Roschier welcomes the chance to serve foreign investors in Finland. Ulf-Henrik Kull concludes, “We are a local firm with 75 years of experience, excellent contacts and an established position on the market. What differentiates us from our competitors is our in-depth expertise and experience in various areas of specialisation, including IPR, dispute resolution and corporate governance issues.”

Keskuskatu 7 A, 00100 Helsinki, Finland Tel.: +358 (0)20 506 6000 Fax: +358 (0)20 506 6100



Ministry Keeping Economic Growth on Track


Mauri Pekkarinen, Minister of Economic Affairs

Business & Investment Opportunities

Mauri Pekkarinen, Finland’s Minister of Economic Affairs, is very optimistic about his country’s future in spite of the impact of the global financial crisis. He points out that Finland was ranked number two in the world in competitiveness in the World Economic Forum’s most recent “Global Competitiveness Report”, and that two European organisations recently named Finland as one of the most innovative countries in the world. He says, “Finland clearly has many strengths that can create new opportunities.”

Finnish companies in a wide range of sectors have become international leaders, including Metso, Nokia, Kone, Konecranes, Vaisala, Fortum and Wartsila, among others. One fast-growing sector in Finland is new energies. “Our companies have developed strengths in clean technologies, and many of these companies are concentrated on very narrow segments in which they operate globally,” the minister says.

Focus on clean technologies Minister Pekkarinen adds that he recently led a delegation of around 80 Finnish “clean tech” companies on a visit to India, which has invited Finland to partner with it concerning a new innovation policy. Finnish leaders in clean forestry technologies include globally successful enterprises UPM, Stora Enso, and Metsäliitto. Finnish firms have developed second generation biodiesel using forestry waste products. The Finnish government aims to have renewable energies make up 20% of Finland’s liquid fuels by

2020, double the EU requirement. “We believe that our companies can produce liquid biofuel from non ethanol raw materials,” the minister says. Minister Pekkarinen points out that the use of bioenergy is already strongly supported by individual consumers and political decision makers in Finland and throughout the Baltic Sea Region. He believes that governments should create favourable conditions for increasing the use of bioenergy, and comments, “All EU member states have legally binding targets for the use of renewable energy, but the challenges for bioenergy vary from country to country. For instance, there are differences in the supply potential of biomass. In some countries it is not possible to use biomass in existing power plants and thus significant new investments are needed.”

Wood chips key source of bioenergy Finland’s thriving wood industry will become an increasingly important source of bioenergy, the minister believes. He says, “There is a massive structural change in the global forestry industry. Pulp wood will be used more and more in energy production. The effects of this structural change will be seen particularly clearly in Finland, where almost 80% of renewable energy in use is wood based bioenergy. Because of this, the future focus in the use of bioenergy in Finland may be on wood chips.” Minister Pekkarinen says that around 5 million cubic metres of wood chips are currently being used in Finland for bioenergy each year and that this total could possibly be increased to 15 million cubic

metres. He adds, “This increase requires both economic steering tools and measures to guarantee the supply chain of bioenergy from forests to power plants.”

Focus on regional cooperation Regional cooperation is a key to the minister’s plans for energy development. He points out, “In the Baltic Sea region, the key factors in increasing the use of sustainable bioenergy are technological development and cooperation. We should all learn from each other’s experiences and best practices. For example, gasification technology can offer new possibilities for using bioenergy in existing power plants. In addition, to ensure that the general attitude towards bioenergy is positive in the future, we have to make sure that the production and the use of bioenergy is sustainable.”

“Our companies have developed strengths in clean technologies, and many of these companies are concentrated on very narrow segments in which they operate globally.” Minister Pekkarinen has also called for strengthening energy ties between Finland and Russia through the creation of a Finnish Russian energy club. “I would like



this club to become a territory of practical interaction between Russia’s proposals and Finland’s

solutions,” he commented at the first meeting of the EU Russia innovation forum in May 2010.

Two new nuclear power plants The minister also wants to build two new nuclear power plants in Finland. He says, “Finland has high energy use because of its energy intensive forestry and metals industries. Since we want to reduce our CO2 emissions, we must base our energy sector on renewable energy and nuclear power. We want to produce all our own electricity by 2020. The message we will send to investors around the world by building the two new nuclear plants is that Finland is willing to guarantee very competitive electricity and energy costs.”

“The message we will send to investors around the world by building the two new nuclear plants is that Finland is willing to guarantee very competitive electricity and energy costs.” Finland also offers investors a highly educated workforce and significant investment in research and development; in fact, Finland is number three in the world in the percentage of its GDP that it devotes to R&D. The minister points out, “Public sector investment in R&D will total €2.1 billion this year, and we hope to have €4 to €5 billion from the private sector.” Business friendly Finland clearly aims to maintain its record for innovation.


Business & Investment Opportunities

Bringing Finnish Innovation to New Markets

Astrid Thors, Minister of Migration and European Affairs

Finland has opened its doors to European investors and businesses and aims to forge new partnerships with its neighbours. With a population of only 5.3 million, Finland needs international ties to keep its economy thriving, and one area in which it hopes to step up cooperation is in research and development, according to Astrid Thors, Minister of Migration and European Affairs.

Open policy towards research financing Astrid Thors explains, “We can win more from having an open policy towards research financing and innovation projects, providing equal access to those in other countries.� She adds that EU research programmes are very important but that smaller scale regional programmes, for example involving Nordic countries or the Baltic states, could be more productive.



One recent effort for Finland is a bilateral programme with Sweden to promote joint research projects. “We could try to go even further in the Nordic region, since we have already had free movement of labour among Nordic countries for 50 years,” Minister Thors says. She strongly supports the kind of regional cooperation represented by the EU Strategy for the Baltic Sea Region adopted in 2009.

“We can win more from having an open policy towards research financing and innovation projects, providing equal access to those in other countries.” Long career in public service Minister Thors was elected to serve in the Finnish Parliament in 2003 and served in the European Parliament between 1996 and 2004. Between 2005 and 2007 she was chairperson of the Swedish Assembly of Finland, and in 2007 she was chosen to be the new Minister of Migration and European Affairs. She has a wide ranging brief as minister; she handles matters covered by the Migration Department, equality issues under the Legal Affairs Unit, and the activities of the Office of the Ombudsman for Minorities and the National Discrimination Tribunal of Finland. Astrid Thors also deals with international issues and matters related to appointments and personnel administration that fall within her field of competence. In addition, she directs financial planning and the preparation of budgets and other joint matters in her field. She has also handled issues involving the Government Secretariat for EU Affairs and the Secretariat for the Finnish EU Presidency.

EU as positive force internationally The minister is committed to making Finland a productive EU member and to making the EU a positive force internationally, for example concerning the concept of transparency. She comments, “As for the future of the EU’s openness, transparency is an instrument as well as a value of the Union. At least we ‘Nordics’ very


much treasure the principles of open decision making. Transparency does not only mean making documents available. It is a wider principle that allows those affected by decisions to know what is happening and how it is happening, not only the basic facts and figures, but also the mechanisms and processes through which those decisions have been taken. Transparency was one of our principal guidelines during the Finnish EU Presidency in 2006. To conclude: within the EU, we must give an example to others and, above all, act accordingly.”

Taking innovation programme to the next level One way Finland is already serving as a positive example is in its focus on innovation, but taking the country’s innovation programme to the next level is necessary, Astrid Thors believes. She points out that Finland has established a strong innovation system, but that the country needs to encourage more cooperation between business and the research sector to help bring innovative new ideas to the marketplace. “We need to tie our research activities more closely to concrete challenges,” she says. Finnish research institutions are already working with the forestry, energy and ICT sectors and the minister hopes to see more cooperation like this in other sectors. Promoting partnerships among Finnish universities is another goal for the minister. “We had one Finnish university that came up with an innovative idea but lacked the capital to develop it. Now we hope to see Finnish universities pool their resources to help each other,” she explains.

Marketing Finland internationally Another key effort for Finland is to market itself internationally. As the minister points out, “Here in Finland we are very good at innovation but not so good at marketing. We are just as industrious as the Japanese, but we are also able to work individually and reach solutions. We need to make the world aware of this!” The government is also encouraging entrepreneurship. Astrid Thors explains, “In the Vaasa region, many people could not accept that their companies had moved away from there so they launched businesses of their own, using their knowledge of the market. This is what we need: more Finnish people with market knowledge who are also entrepreneurial. Innovative smaller Finnish companies have immense potential to succeed in the EU marketplace.”

Business & Investment Opportunities


Independent Fund Promoting Innovations in the Society and Economy Sitra, the Finnish Innovation Fund, is playing a key role in boosting Finland’s international competitiveness. The independent public fund aims to ensure Finland’s sustainable development and enhance its global presence through enabling positive change. Sitra focuses on promoting efficiency and transparency, empowerment and active citizenship, human-centric technologies, and better co-operation between the public and private sectors as well as local communities. Mikko Kosonen, former Chief Strategy and Information Officer of Nokia and now Sitra’s President, stresses the importance of Sitra’s mission. He explains, “The OECD country report on Finland gives a good picture of what Finland’s challenges are, including the fact that it needs to be more open to the world. Sitra, operating independently outside the government and reporting only to the Finnish parliament, is well placed to serve as a driver for positive change. Our endowment has grown to around €700 million and our operations are funded with returns from capital investments. The aim is to invest on the projects that will improve Finland’s competitiveness and well-being of its people. Sitra’s autonomy allows it to challenge the status quo.” Key goals for Sitra include creating new business opportunities for the Finnish industries, which have been based on industrial exports and now face overwhelming competition from Asia and other markets, and coping with the challenge of the country’s aging population, a factor which is placing great stress on Finland’s Scandinavian welfare state model.

Five key programmes To cope with these challenges, Sitra has devised five key programmes. These are streamlining public services through harmonizing information and communications systems and introducing new e-services; promoting a new model for government to upgrade

Mikko Kosonen, President

governance and efficiency; launching new initiatives to increase energy efficiency in the area of built environment; finding new uses for Finland’s natural resources and developing the rural economy; and boosting Finland’s international competitiveness through promoting innovative enterprises and new services. “In hard times like these, public sectors tend to avoid risks and companies tend to invest in short-term initiatives. Sitra aims to serve as the risk taker for the public and private sectors to show that change can happen and it can be very positive,” Mikko Kosonen says. He adds that one goal for Sitra is to position Finland as an example of a sustainable society where diverse ways of producing well-being, services and growth flourish. He concludes, “What Nokia did in its field, Finland can also do: serve as an innovator in global markets.”

Itämerentori 2 - FI-00181 Helsinki Tel.: +358 9 618 991 - Fax: +358 9 645 072 -




Providing World-Class Consulting Services BioFund has established a strong international reputation for successful management of venture capital backed companies, particularly in biomedical, medtech and cleantech companies. Now BioFund is rebranding to focus on providing consulting services to support early stage companies in the life science sector. Erkki Pekkarinen, Owner and Chairman explains, “We are currently building on our expertise in the markets where we have been making investments – in the Nordic countries as well as in the UK, US, Germany, Switzerland and Canada – because we believe many companies need consulting support in becoming more international, obtaining financing, and bringing in qualified management.” Erkki Pekkarinen points out that the pharmaceuticals industry, one of BioFund’s specialities, is one which regularly needs major capital inflows in order to keep up with research and development, and Finnish companies usually need to seek majority of this capital abroad. He says, “In the first stage we want to help Finnish companies to reach the point where they attract soft money providers. We are not only looking at Finnish companies since industries, especially pharmaceuticals, need to join international networks and make partnering deals much earlier than before. Having access to sources of private


ment potential. “Many companies are at a stage of their development where they need more players and investors, and green industries are currently consolidating. All this will create even more viable investment targets for international investors,” he says.

Erkki Pekkarinen, Owner and Chairman

capital helps the top management to concentrate on relevant business development tasks.”

Advantages of working with EU partners

Finland in general offers exceptional investment attractions, Erkki Pekkarinen believes, thanks to its highly educated human resources and track record for innovation, but some Finnish companies need help in taking advantage of these strengths. BioFund also does not want to see well-trained Finnish young people unable to find jobs in Finland. For these reasons, BioFund is dedicated to helping Finnish companies develop over the next decade. He says, “We have more than 10 years of experience in pharmaceuticals and medical, technology and the environment, and we are ready to capitalise on our expertise.”

BioFund also aims to build stronger ties between Finland and other countries in the EU and beyond. “We want to give certain sectors more visibility to demonstrate their potential and the advantages of partnering with European investors and peers. There are gaps in the kind of help companies are receiving here in Finland and we want to fill those gaps,” Erkki Pekkarinen explains. One area of expertise for BioFund is cleantech, and Erkki Pekkarinen believes that Finnish environmental companies offer strong invest-

PO Box 164 00101 Helsinki, Finland Tel.: +358 50 373 3931

• Minister of Finance Calls for Fiscal Consolidation • Strong Supervision Bringing Financial Sector through Crisis • Helsinki Stock Exchange a Top Performer in 2010


“Global recovery appears stronger than expected and global financial stability conditions have also improved.” Jyrki Katainen, Minister of Finance


Minister of Finance Calls for Fiscal Consolidation In November 2010, Standard & Poor’s Rating Services affirmed its AAA long term and A-1+ short term sovereign credit ratings for Finland and noted that the outlook for the Finnish economy is stable. In December 2010, the Finnish Ministry of Finance raised its 2010 growth projection for the economy from 2.1% to 3.2%, citing a faster than expected recovery in global trade. The ministry retained its original growth projection for 2011 (2.9%) and raised its 2012 projection to 2.7%.

Jyrki Katainen, Minister of Finance

Coping with aftermath of financial crisis These factors demonstrate that the Finnish economy is recovering from the economic crisis. Many challenges remain, however. Jyrki Katainen, Minister of Finance, notes that inflation is expected to rise to 2.4% in 2011 from a little


over 2% in 2010, mainly due to tax changes and higher commodity prices, and that the country’s budget deficit should rise to 6% of GDP this year and stay above the 3% EU limit into 2012. The Minister of Finance favours a global approach to ensuring not only recovery from the crisis


but also prevention of similar problems in the future. In a speech he delivered in April 2010 at the meeting of the IMF’s International Monetary and Financial Committee (IMFC) in Washington, DC, Jyrki Katainen commented, “While the economic and financial situation has improved, serious policy challenges remain, particularly in safeguarding public finances and rebalancing global demand. The global crisis has demonstrated the need for stronger IMF surveillance particularly on macrosystemic risks stemming from the financial sector and multilateral aspects of domestic policies. The IMF should take a leading role in analysing and giving guidance on macrosystemic issues related to financial regulation and supervision.”

Strengthening multilateral surveillance, risk assessment Jyrki Katainen was speaking on behalf of Denmark, Estonia, Iceland, Latvia, Lithuania, Norway, and Sweden as well as Finland. He called for a “systemic bank or stability fee” to complement other measures planned to address systemic risk, and added, “A strengthened IMFC should be the key forum for global economic and financial discussions and decisions, being a truly multilateral and statutory based institution where all countries are represented. The Nordic-Baltic constituency strongly supports strengthening multilateral surveillance, assessments of macro systemic risks and spill over effects, and international policy coordination.” While observing that “global recovery appears stronger than expected and global financial stability conditions have also improved,” the minister added in his speech, “Still, the recovery, which in the advanced economies has been

driven mainly by policy support and the inventory cycle, is fragile as mostly downside risks remain and the global risk profile has been altered by the deterioration in fiscal balances and rapid accumulation of public debt. Countries should prepare and clearly communicate exit strategies from economic policy stimulus. A firm commitment to sound medium-term fiscal and monetary policy frameworks is essential in safeguarding public finances, anchoring inflation expectations, and underpinning confidence in the private sector.” Jyrki Katainen also commented, “For most advanced countries, significant fiscal consolidation should be initiated in 2010 or 2011, depending on the fiscal challenges and taking into account sovereign risks to global stability.”

“Finland’s national Europe 2020 targets are more ambitious than those established by the European Council for the whole of the EU. These ambitious targets are essential to secure sustainable public finances in Finland.” Strengthening public finances The 2009 recession was one of the deepest ever in Finnish economic history; Finland’s GDP decreased by 8% and its previously strong public finances deteriorated by as much as €12 billion, or 7 percentage points of GDP. The Ministry of Finance notes that although the Finnish economy experienced moderate

growth in 2010, “the general government deficit will continue to deepen because changes in the cyclical position are always slow to feed through. In 2010 and 2011 the first steps will be taken towards the stabilisation of public finances.” Finland’s public debt is expected to top €100 billion in 2012, or 52% of GDP. Central government finances will still be in deficit in 2012 and borrowing will remain at approximately €8 billion. Overall, public debt will increase between 2008 and 2012 by nearly €40 billion, according to the ministry. On the positive side, the euro area, which is particularly important to Finland, is expected to benefit from the strong rebound of the global economy and world trade in particular during the latter part of 2010 and in early 2011. The Ministry of Finance also predicts a 7% growth in private investment in 2011.

Europe 2020 Strategy In November 2010, the Ministry of Finance and other government ministries announced the launch of the Europe 2020 draft national programme for Finland, part of the Europe 2020 Strategy for the EU adopted by the European Council in June 2010. Finland’s Europe 2020 programme describes the main obstacles to economic growth, specifies five national targets, and builds on a strong European framework. As Jyrki Katainen points out, “Finland’s national Europe 2020 targets are more ambitious than those established by the European Council for the whole of the EU. These ambitious targets are essential to secure sustainable public finances in Finland.”



Municipality Finance plc

Providing Financing Solutions for Finland’s Municipalities Municipality Finance Plc (Kuntarahoitus Oyj in Finnish) has been providing high quality financial services for the past two decades. Its specialty is to obtain funds from international capital markets and then grant loans to municipalities or entities owned by municipalities. “We serve as the middle man between investors and municipalities,” explains Pekka Averio, President and CEO.

Maintaining AAA rating Municipality Finance has already raised nearly €6 billion in funding this year. The company achieved a turnover of around €285 million with profits of around €34 million in 2009, and Pekka Averio anticipates even better results for 2010 since mid year profits had already reached €31 million. “We have been really successful in our funding this year because of our AAA rating, and Finland is still a very good economy compared to other European countries,” he points out. During the recent financial crisis, Municipality Finance had a market share of up to 90%. “We have probably been the only provider of financing for Finland’s municipal sector since the crisis started,” Pekka Averio says. He adds that some municipalities are too small to access the kind of funding that Municipality Finance can obtain for them, and many are also facing problems because of an aging population and a shrinking banking sector. “Where 10 to 15 banks operated only five to 10 years ago, today there are only four or five, and only one of them is Finnish. Our mission is to safeguard funding for our clients,” he says.

Pekka Averio, President and CEO

the sanctions these banks are about to face should not be applicable to companies like ours.” Municipality Finance has proven to be very cost effective, managing to maintain a balance of around €20 billion with only 50 employees, and Pekka Averio anticipates continued success. He says, “Unlike our competitors, we are a niche player and we know our customers really well. Finnish municipalities’ total debt should be around 6% to 7% in 2015, but since they are small we do not see a problem for them. The banking sector does not seem to be interested in the public sector, so our projects will be growing stronger.”

EU support needed Pekka Averio believes that companies like Municipality Finance merit more EU support. He says, “We operate in a very low risk profile and feel that in many cases, we should have more understanding from the EU, because we are not as much of a commercial bank as others, so


P.O. BOX 744, Antinkatu 3 C, 5th floor FI-00101 Helsinki Tel.: +358 9 6803 5666


Strong Supervision Bringing Financial Sector through Crisis Finland’s financial services sector has weathered the global financial crisis thanks to strong macroeconomic fundamentals and vigilant supervision. “The majority of Finnish banking groups and financial conglomerates expect results for 2010 to be at least as good as in 2009; some have revised their assessments upwards,” commented Erkki Liikanen, Governor of the Bank of Finland (Finland’s central bank), in July 2010. The Bank of Finland monitors the Finnish financial system as a whole with the objective of maintaining stable, reliable and effective financial and payment systems. The Finnish Financial Supervisory Authority (FIN-FSA), operating in connection with the Bank of Finland, supervises individual banks, insurance companies and securities markets. The FIN-FSA recently reported, “Economic recovery on a nearly global scale has improved the operating environment of the Finnish financial sector. As a result, Finnish banks expect fewer credit losses than previously estimated. However, the operating environment is still marked by significant uncertainty. This can, for example, be seen in the relatively high volatility in the stock and bond markets.” The report added that at the end of June 2010, Finnish banks’ capital adequacy ratio was still strong,

averaging 14.1%, well above the minimum level of 8%. Solvency in the insurance sector was reassuring as well; authorised pension insurance companies’ solvency margin was 2.5 times the solvency limit after consideration of market risks. Life insurance companies’ solvency margin was 4.3 times the legally required minimum, and the corresponding solvency margin of non-life insurance companies was fourfold.

Financial Services Authority playing key role The FIN-FSA, an independent and autonomous authority, was founded in 2009, replacing its predecessor, the Financial Supervision Authority.

The Insurance Supervisory Authority is also part of FIN-FSA. According to the Deputy Governor of the Bank of Finland, Pentti Hakkarainen, “The decision to merge financial and insurance supervision was taken prior to the financial crisis but the experiences of the crisis confirmed the need for comprehensive supervision of financial sector risks and close cooperation with the Central Bank. Clearly great benefits derive from the institutional arrangement in Finland. The combination of macro and micro prudential oversight and supervision is just what the doctor ordered after the financial crisis. The new FIN-FSA works well as an independent authority and close to the Central Bank by covering all relevant financial institutions. It also



seems to fit nicely to the proposed and forthcoming European supervisory and regulatory framework.”

Finnish banks stable, can meet new Basel criteria Anneli Tuominen, Director General of the FSA, commented recently, “The recovery of the real economy is reflected positively in the state of the Finnish financial sector. However, due to the uncertainty regarding the global economy and particularly the state of the highly indebted countries, market risks are still high. In spite of this uncertainty, the funding of Finnish banks is currently stable.” In the first half of 2010, sluggish developments in net interest income resulted in pre tax profits 15% lower than a year earlier for Finnish banks, according to the Bank of Finland; however, the bank states, “The


outlook has improved: net interest income seems to have bottomed out and loan losses have decreased. Recent developments indicate that the decrease in net interest income has come to a halt.” The Bank of Finland adds that Finnish banks’ other income, particularly net fee income, increased in the first half of 2010, although total income was lower than a year earlier, while growth in expenses was moderate, and loan losses were more than a third lower than in the first half of 2009. Meanwhile, the total value of banks’ nonperforming assets has remained at just over €1.2 billion since the end of 2009, and loan losses also came to a halt at the end of 2009. In addition, the Bank of Finland reports, “Finnish banks have sufficient regulatory capital, and the quality is good. Tier 1 capital excluding principal loans (core tier

1 capital),which is the most suitable for covering losses, accounts for over 90% of the banking sector’s regulatory capital.” The bank’s report adds, “Finnish banks’ overall margin remained at 1.6% in the first half of 2010, but the weight of its components have changed: what banks have lost as a result of narrowing lending margins was offset by wider margins on deposits.” In fact, Finnish banks should have no difficulty meeting new Basel Committee on Banking Supervision criteria which call for banks to hold considerably more capital of higher quality to cover possible losses beginning in 2013 and for new liquidity provisions beginning in 2015. “As a result of the high capital adequacy of Finnish banks and the long transition times, adjustment to the new rules should pose no major problems,” says Jukka Vesala, the FSA’s Deputy Director General.


Helsinki Stock Exchange a Top Performer in 2010 The Helsinki stock exchange, which dates back over 90 years, is now NASDAQ OMX Helsinki within the NASDAQ OMX Exchanges group. At the end of 2009, NASDAQ OMX Helsinki had 129 companies listed with a total market value of â‚Ź141 billion. Both domestic and foreign banks and investment service companies can operate as stock and derivatives brokerage firms on the exchange, and more than 100 information vendors sell and distribute market information worldwide.

Strong performance in 2010 Coming through the financial crisis with impressive robustness, the Finnish stock market advanced more than practically any other developed country’s national index in 2010. By early December, the OMX Helsinki index was up 29% compared to December 2009, far outpacing most of its peers. Overall, Nordic exchanges performed well in 2010, but the Finnish index achieved the best results. An early December 2010 report in the Helsinki Times states,



“Among individual Finnish companies there are a host of good performers in 2010. PKC Group and Nordic Aluminium, for example, are both up about 90%. Almost two dozen firms have had their share price increase by about half or more, while a wide range of corporations listed on the exchange have seen their stocks climb 30% or more.”

Long history of dynamic trading NASDAQ OMX Helsinki has a long history, having been founded as the Helsinki Stock Exchange (HSE) in 1912 as Finland’s first organised and regulated stock exchange. It has steadily evolved over the years to meet investors’ needs. In December 1997, the cash and derivatives marketplace of the HSE and SOM merged to become Helsinki Exchanges, and in 1998 Helsinki Exchanges and the Central Securities Depository (APK) merged to form the HEX Group. In 2001 and 2002, HEX became the majority shareholder of the TSE Group, which includes the Tallinn Exchange, the Estonian Securities Depository and the Riga Stock Exchange, the sole shareholder of the Latvian Securities Depository (LCD). In 2003, OM the parent company of the Stockholm Stock Exchange - bought HEX, and the stock exchange operators merged. In addition, in 2006 the Copenhagen Stock Exchange and the Iceland Stock Exchange became part of OMX, the operator of stock exchanges in the Nordic and Baltic regions. NASDAQ OMX was formed when OMX merged with the American technology stock exchange NASDAQ in 2007. Today, NASDAQ OMX is the world’s largest exchange company, delivering trading, exchange technology and public company services across six continents, with more than 3,600 listed companies. NASDAQ OMX technology supports the operations of over 70 stock exchanges, clearing organisations and stock market centres in over 50 countries.

NASDAQ OMX Nordic and NASDAQ OMX Baltic: investors’ gateway In the Nordic and Baltic regions, NASDAQ OMX owns and operates the stock exchanges in Copenhagen, Stockholm, Reykjavik, Tallinn, Riga and Vilnius as well as Helsinki. NASDAQ OMX Nordic and NASDAQ OMX Baltic are investors’ preferred access points to these


securities markets. Both offer cross border trading and clearing of equities, ETFs, convertibles, fixed income, commodities, warrants and derivatives, on highly efficient trading systems. In 2009, OMXS30 was the third most traded domestic index in Europe; it is a member of the Standard & Poors 500 Index. The NASDAQ OMX Nordic web site provides details about listed companies and other information concerning all the group’s exchanges in the Nordic region, including the Helsinki exchange.

Highest international standards The Helsinki exchange meets the highest international standards. Activity is regulated by the Securities Markets Act, and Finland’s Financial Supervision Authority (FSA) supervises financial markets and participants; FSA regulations complement Finnish legislation for credit institutions and capital markets. Finland’s Ministry of Finance is responsible for strategic policies on financial markets and ensures that the legislative framework is efficient and world class.

Helsinki exchange goes green In mid December 2010, the Helsinki exchange demonstrated its forward-thinking policies when it was designated by the World Wildlife Fund Green Office as the first Green Office Exchange in the world. WWF’s Green Office is a practical environmental program for companies which aim to reduce the environmental impact of offices, to slow down climate change and to increase staff’s awareness of ecological consumption by encouraging them to act in an environmentally friendly way. Lauri Rosendahl, President of NASDAQ OMX Helsinki, explains, “For NASDAQ OMX Helsinki, the idea for the programme was originally presented as an employee initiative. Awareness of environmental issues is constantly increasing and we wanted to do our part to make the necessary changes, similar to what many of our listed companies on the Helsinki stock exchange have already done. In addition, this project represented a way for the Helsinki team to do something good together and it has already received a lot of interest in the other offices of the NASDAQ OMX group. We strive to make this a Finnish export product inside the NASDAQ OMX group.”

• Cutting-Edge Energy Sector Open to International Partnerships • Open Energy Market Continues to Attract Investment • Sitra’s Energy Programme Ensuring Sustainability

Energy & Sustainability

“Finland opened its energy market even before this was required by the EU.” Asta Sihvonen-Punkka, Director General , Energy Market Authority


Cutting-Edge Energy Sector Open to International Partnerships

Finland’s cutting-edge energy sector is one of the most advanced in Europe, particularly concerning bioenergy and other renewable energy sources. The Finnish energy sector has been fully liberalised and offers significant potential for investment and international partnerships. Finland’s energy policy is based on the versatile use of different fuels, energy production technologies and energy systems; Finland also supports a wide range of energy production facilities, both small and large. Finland generates electricity from nuclear, hydropower, natural gas, biofuel, coal, peat and wind sources. Bioenergy from wood chips, for example, accounts for around 70% of the renewable energy currently being produced in Finland.

Sustainability, self sufficiency, and emissions reduction Sustainability, self sufficiency, and emissions reduction are the guiding principles behind Finland’s energy programmes. To ensure energy sustainability, Finland has developed a strong regulatory environment which


includes the Finnish Land Use and Building Act (2000); this legislation has proved an important instrument in the promotion of ecological sustainability as well as energy efficiency. The objective of the act is to ensure that the use of land and water areas and building activities on them create preconditions for a favourable living environment and promote ecologically, economically, socially and culturally sustainable development according to Finland’s Ministry of the Environment. In 2003, Finland also implemented stringent regulations for the energy performance of new buildings, and in 2008 the Ministry of the Environment’s Decree on Energy Certification of Buildings came into force; it is geared to meeting new EU criteria.

Global leader in co-generation Focusing on energy efficiency, Finland promotes combined heat and power production with high efficiency, low nominal energy consumption and low emissions. In fact, Finland is a global leader in the fastgrowing field of co-generation of electricity and heat. Concerning energy self sufficiency, Finland currently imports more than half of its energy and energy raw

Energy & Sustainability

materials, as well as around 12% to 20% of its electricity, and the government is strongly promoting projects which can reduce these energy imports. Finland has also set ambitious targets concerning emissions reduction. Under the Kyoto Protocol, Finland has agreed to keep its greenhouse gas (GHG) emissions at 1990 levels during the 2008-2012 target period, and in 2001 the Finnish parliament passed the National Climate Strategy (NCS) to curb GHG emissions. The NCS includes an impressive array of programmes in all emissions producing sectors. To meet its goals for clean energy, Finland is focusing on nuclear and wind power installations. The government has announced that it will build three new nuclear power plants, and Finland currently has wind-power projects totalling 8 GW, of which 5.8 GW are produced by offshore wind-power installations.

Energy policy praised by IEA To continue to drive its energy sector forward, Finland has created a dynamic energy technology cluster and has fully liberalised its energy sector as well as promoted the globalisation of Finnish energy companies. As a recent International Energy Agency (IEA) report points out, “Finnish energy policy is characterised by three commendable traits. One, Finland employs a holistic approach to energy. Its energy policy strives to simultaneously pursue the three E’s – Energy security, Economic development and Environmental sustainability. This approach is apparent in the effective communication on energy policy issues between the various ministries and energy programmes which pursue numerous policy goals in tandem and act in concert rather than in conflict with one another.”

The IEA report also praises Finland’s liberalised, very international approach to energy development. It explains that the second commendable trait of Finnish energy policy is that it successfully employs international trade to lower energy costs and enhance energy security. As part of the Nordic Power Market (Nordpool), Finland has successfully integrated its electricity market with those of the Scandinavian countries. Finally, the report notes, “Finland applies a light-handed approach to energy regulation. Its electricity sector is one of the least regulated in the world, with companies free to build power plants as they wish and all customers free to choose their supplier.”

Promoting research and development Finland actively supports continued research and development in the energy sector. Sitra,

Finland’s innovation fund, has created a particularly successful energy programme for the period 2008 to 2012 and has a number of ambitious projects underway geared to promoting energy sustainability. In addition, the non-profit VTT Technical Research Centre, part of the Finnish innovation system, is very active in the energy sector. Its mission statement explains, “VTT pursues versatile energy research, from nuclear to renewables. Energy economy, transmission and storage as well as the efficient use of energy and the management of emissions form an essential part of our research. Our services and expertise cover all parties involved in the energy business value chain. VTT also studies energy systems and supports political decision making on energy issues, both nationally and internationally.”



Open Energy Market Continues to Attract Investment The Energy Market Authority (EMA) is Finland’s energy sector regulator, overseeing Finland’s electricity, gas and emissions trading; it is the only energy regulator in the EU to deal with emissions. The EMA is widely recognised for its efficient operations and for making sure that Finland relies on diverse sources of energy to guarantee secure energy supplies at competitive prices. “We have reduced the risks related to supply and prices by tapping into many different energy sources: hydropower, gas, coal, nuclear power and renewables,” explains Asta Sihvonen-Punkka, EMA Director General. The EMA supports an open energy sector. “Finland opened its energy market even before this was required by the EU,” Asta Sihvonen-Punkka points out. She adds that the EMA will in the future also be dealing with renewables to ensure that Finland meets the EU’s goals for using renewable energies. While the EMA is a relatively small organisation with only 36 staff members at the moment, it has proven to be very active internationally, partnering with EU and Nordic energy organisations. Asta Sihvonen-Punkka chairs the European Electricity Working Group and also serves as the vice chair and vice president of the two European energy regulators’ organisations. “Finland has been one of the forerunners of market integration in Europe. The Nordic energy integration process started in the mid 1990s, so we have extensive experience in what is required to integrate energy markets on an international level,” she says.

Focus on European integration A number of initiatives with progress has been undertaken to integrate the Nordic market with both the Continental Europe and the Baltic market. The German market has been coupled with the Nordic since last November, which has increased the efficiency of the use of transmission infrastructure on the affected borders. The EMA is also currently involved in an initiative to integrate the Baltic and Nordic


Asta Sihvonen-Punkka, Director General Energy Market Authority

energy markets. Finland’s energy grid is already linked to Estonia’s through a cable and another cable between the two countries is planned. One third of the costs of this new connection will be funded by the EU. Asta Sihvonen-Punkka anticipates strong investment in Finland’s energy sector in the coming years. She points out, “The energy sector accounted for half of all investments in Finland in 2009. We aim to continue to ensure security of supply as well as competitive prices. We have found that market integration and competition are really the keys for having an efficient energy sector that provides the basis for healthy industry, and we at EMA believe that the role of regulators is to ensure that the energy sector is designed in this way. We are helping to make sure that Finland’s energy sector provides a competitive environment for business.”

Energy & Sustainability

Ensuring Adequate Electricity Supplies for the Future Finland has taken a long-term approach to ensuring energy security, and the government aims for the country to be energy self sufficient within a decade. Finland has been working in close partnership with other Nordic countries since the 1960s in a common energy market; this successful effort is seen as a model for a future integrated European energy market. To achieve energy self sufficiency, Finland will follow a multifaceted strategy that includes upgrading the efficiency of its power plants, completing the new nuclear power plant that is currently under construction and building two more plants which have been licensed, and developing renewable energy sources. Finland will derive 38% of its energy from renewable energy sources by 2020, meeting EU targets.

Promoting an integrated European electricity market

common energy market, plays a key role in the drive to achieve an integrated European energy market. Unlike many other EU countries, Finland relies more on electricity than on gas, and Jukka Ruusunen believes the country is moving even more towards electricity as its primary type of energy. Concerning renewable energy supplies, Finland’s major source at present is its forests, but wind energy represents a growth area.

Jukka Ruusunen, President and CEO Fingrid

CEO, explains, “We are investing more than this company has ever done. We aim to do all we can to help develop nuclear power and wind power, as well as to better integrate Finland with the European electricity market.” Jukka Ruusunen is also Vice President of the European Network of Transmission System Operators for Electricity and is making sure that Fingrid, a major player in the Nordic

Fingrid aims to continue to promote the implementation of new technologies in Finland’s energy grid and to remain flexible to cope with evolving conditions in the European and global energy market. Fingrid will also continue to support co-operation among Finland’s energy sector, private enterprises and investors, and the EU. Jukka Ruusunen explains, “We cannot reach national and EU targets alone; no company or country can. This is why we have to work together. We are part of the same family. There is no other commodity that connects all of the EU countries in the way that electricity does.”

To help provide adequate energy for the local economy, Finland’s electricity transmission operator, Fingrid, aims to build almost 3,000 km of transmission lines, some 30 new substations, and additional reserve power capacity over the next decade. Fingrid has budgeted €1.7 billion for this effort, which together with tariff financing will require external financing. Jukka Ruusunen, Fingrid’s President and



Sitra’s Energy Programme Ensuring Sustainability Sitra, the Finnish Innovation Fund, has fostered a number of cutting-edge programmes that are ensuring sustainable development and better quality of life. Sitra’s current five-year Energy Programme, which was launched in 2008, is a case in point. Johanna Kirkinen, Energy and Climate Change Lead for Sitra’s Energy Programme, explains, “Well-being is no longer limited to economic growth and a healthy GDP. Energy efficiency also plays a role. The idea we are trying to call attention to is that energy efficiency will contribute to better economic performance, and that a reduction in energy consumption today can contribute to a greater well-being tomorrow.” Finland’s national plan for the built environment includes reaching the EU’s 2020 energy efficiency and emissions reduction targets early, in 2017, the year Finland will celebrate the 100th anniversary of its independence. “The goal of Sitra’s Energy Programme is to make a contribution towards reaching that target,” Johanna Kirkinen says. The EU’s goal is to produce 20% of its energy with renewable sources. Finland is already producing some 20% of its energy with renewable sources and is now working to boost that percentage to 38%. In reaching the goals of its Energy Programme, Sitra is working in partnership with municipalities, universities, the Finnish government, TEKES, and other organisations. Sitra’s financial support for energy projects, as for all its other activities, comes entirely from the profits gained on investments made from Sitra’s endowment capital.

Three target areas for the Energy Programme Johanna Kirkinen explains that Sitra’s Energy Programme has three key target areas: sensitising the Finnish population concerning the need to use energy responsibly; creating successful new business activities in the fields of energy efficiency and sustainable energy production, including solar power; and promoting energy efficiency in the built environment.


Johanna Kirkinen, Energy and Climate Change Lead for Sitra’s Energy Programme

Public awareness, business creation A priority for Sitra’s Energy Programme is “to encourage Finnish people to save energy, to create opportunities for consumers to adopt sensible and energy-efficient solutions, and to make people more responsible,” Johanna Kirkinen says. Sitra is financing energy awareness initiatives, such as the Consumer Energy Advice in partnership with the Ministry of Employment and the Economy. Other initiatives in this area are focusing on the society “gatekeepers”, including parents, restaurant owners and others in a position to influence the positive behaviour of others. Another key aspect of Sitra’s Energy Programme is business creation. The fund is providing venture capital for companies whose activities and products focus on achieving energy efficiency, or which include such products in their portfolios.

Energy efficient construction Concerning energy efficiency in the built environment, Sitra’s Energy Programme draws attention to the fact that urban planning can have a major influence on energy consumption. “We want urban planners and energy efficiency experts to collaborate,” Johanna Kirkinen says.

Sitra assists municipalities in launching energy efficiency programmes, which the municipalities then finance themselves. An example is a recent project in Porvoo, where experts have studied the carbon footprint emissions plans to determine the best urban plan for a new residential area. Johanna Kirkinen says, “After Porvoo, a lot of other cities in Finland are now interested in similar programmes. Tampere has launched the ECO2 programme through which the whole city including its local energy company and urban planners has made a commitment to speeding up the city’s progress towards meeting the EU’s 2020 energy emissions reduction target.” Sitra aims to serve as an example to Finland’s construction sector. As Johanna Kirkinen points out, “buildings use some 40% of the energy consumed in Finland, so one of our actions is to promote the construction of buildings with the most efficient energy use possible. Finland lags behind in this field and our goal is to be a pioneer and to wake up the Finnish building sector to the need to focus on energy efficiency.”

Finland’s first zero energy building Developing “green” housing is a priority for Sitra, which has financed the completion of Finland’s first zero efficient building, an award-winning project which

illustrates the viability of both energy efficient construction and solar power. Luukku House, a project in which Sitra was the main financier, won the fifth prize in the first European Solar Decathlon competition held in June 2010. “Finnish students designed this low carbon emissions house out of wood. This first zero energy house gained a lot of publicity in Finland because people have been skeptical about solar energy,” Johanna Kirkinen says.

Jätkäsaari City Block: sustainable development in action The Jätkäsaari City Block for Sustainable Development is part of Sitra’s ambitious Low2No initiative, which is based on the idea that carbon emissions reduction within cities is strategically critical for achieving global sustainability. Marco Steinberg, Director of Strategic Design, explains that Sitra has acquired the right to develop one 22,000 sq m block in Helsinki’s Jätkäsaari project. Sitra, which will establish its headquarters on this new block, has partnered on this project with leading Finnish construction enterprises SRV and VVO. In March 2009, Sitra launched an international competition to develop a strategy for the project. In May 2009 it selected five teams out of 75 entries from all over the world to participate in the competition, and in September 2009 the winning team was elected.



Sitra aims for its block project to result in long-term positive change. Marco Steinberg explains, “Sitra is not a developer. Our partners are. We have two fundamental objectives with this project: to build a more functional headquarters and to transition Finnish development toward zero carbon. If, in 20 years, we have only built this block, we will have failed. Our goal is to change business practices, develop partnerships, and find new mechanisms for sustainable development.”

Focus on reducing carbon emissions While the Jätkäsaari project is for one city block, it is ultimately about cities in general; cities cover only 1% of the Earth’s surface but account for 75% of global energy use and 80% of green house gases. “We cannot just suddenly eliminate existing urban environments or change high carbon emissions to zero emissions. We have to create a transition, and that is what Low2No aims to be. A transitional strategy from low to zero carbon solutions,” Marco Steinberg says. Helsinki’s Jätkäsaari district is set for completion by 2025 and Sitra aims for its city block project to be finished by 2013. Amongst many concrete objectives, Sitra wants to be at least five years ahead of the targets for the EU’s Energy Performance of Buildings Directive (EPBD), a formidable goal. Marco Steinberg explains, “The EPBD really puts pressure on buildings to have onsite renewable energy supplies. That is a challenge for Helsinki because it has centralised heating and cooling. We hope to figure out the best solutions for low carbon emissions and also to come up with a timeline for no carbon emissions. This is a work in progress with many milestones along the way.” Sitra’s block project takes much more than energy use into account. Marco Steinberg says, “This


Marco Steinberg, Director of Strategic Design at Sitra

project is not just about architecture, mobility, energy policy or consumer behaviour, but rather all of them. We have made consumer behaviour one of the cornerstones of this project instead of looking at buildings, energy and production separately and without the consumer dimension. This challenges the way we go about the design.” The Sitra team is making sure that everything on the block, from housing to laundry facilities, will

not only use energy sustainably but also inspire more energy conscious consumer behaviour. “Every single activity of every single entity on that block is dissected and reintegrated in order to reduce the carbon footprint of the total solution,” Marco Steinberg explains. Sitra’s Low2No initiative is yet another example of this dynamic fund’s commitment to ensuring long-term energy sustainability and better quality of life.

Energy & Sustainability

Ensto Finland Oy

Innovative Enterprise Focuses on Sustainable, Efficient Energy Solutions The international Ensto Group always lives up to its motto, “Ensto saves you energy”. Ensto specialises in offering reliable and energy efficient electrical systems and supplies with a focus on sustainability. The family-owned enterprise, founded in Finland in 1958, now operates in 19 countries and achieves €200 million in annual turnover. Ensto serves a wide range of customers, including power plants, electrical supply wholesalers, contractors, designers and technicians, and companies in the electrical and electronics industries. It exemplifies Finnish innovation, cutting-edge technology and concern for the environment. Timo Luukkainen, CEO, explains, “We base all of our product development and manufacturing on sustainability. Global warming and the growing need for energy efficiency are key trends for us. We are a leader in the drive to help improve energy efficiency and we are very concerned that CO2 emissions are not being fought in a more efficient way. We believe that global energy prices will continue to rise, which is one reason why we have focused on using energy more efficiently. Finding ways to be more energy efficient is not a burden to us; it is an opportunity.”

Clean, efficient energy All of Ensto’s products are recyclable and the company bases its production facilities close to its markets so that transport will not increase its carbon footprint. It is committed to transparency as well as to achieving the EU’s energy efficiency targets. Timo Luukkainen says, “We are a leader in designing and manufacturing charging systems for electric vehicles and we are also a specialist in energy efficient buildings that are healthful to live in.” Ensto’s top ventilation products achieve an impressive 90% energy efficiency rating compared to around 50% for the products of most of the company’s competitors. “Smart grids” are another speciality for Ensto. Timo Luukkainen concludes, “We are highly respected

Timo Luukkainen, CEO

throughout the EU for our focus on clean, efficient distribution and use of energy with the least possible CO2 emissions. We see smart grids as having huge business potential for us.” Timo Luukkainen continues, “Last year sales of our components for energy generation and distribution grew by over 30%, even during the global crisis. We are doing well in all our markets. Ensto is in the driver’s seat concerning implementing innovative energy solutions. As a company, our responsibility is not only to promote our products but to promote ways to ensure a better life and save the planet.”

Ensto Finland Oy Ensio Miettisen katu 2, P.O. Box 77 06101 Porvoo, Finland Tel.: +358 204 76 21



RAO Nordic Oy

Energy Trader Welcomes New Projects and Partnerships RAO Nordic Oy has quickly become a strong leader in Finland’s power sector. The company was established in Helsinki in 2002 as a 100% subsidiary of the Russian power group Inter RAO UES (part of the restructured power giant RAO UES) to import electricity to Finland and sell it through bilateral contracts to customers and through the Nord Pool single energy market. After less than two years of operations, RAO Nordic was listed among Finland’s top 500 companies. Today, having grown rapidly, it is active mainly in the Nordic region as well as in the Baltic, where it has established a subsidiary, Inter RAO Lithuania, as its regional base. RAO Nordic aims to continue to expand in the Nordic region as well as elsewhere in Europe and to augment its range of services.

Core business: electricity trading Oleg Zakataev, Managing Director, explains, “Electricity trading is our core business at RAO Nordic.” RAO Nordic operates in the over the counter (OTC) trading market and is also involved in physical and financial trading through the Nord Pool Power Exchange. RAO Nordic has achieved impressive success, increasing its number of employees from five to 15 and boosting its market share of cross border electricity trades between Russia and Finland from 50 MW to 980 MW, or around 10% of Finland’s overall electricity consumption. The company is currently working on boosting that market share further. Oleg Zakataev says, “Since the cross border market is limited, we are looking for other opportunities, including buying and physically selling within Finland. We are in the Finnish price zone within Nord Pool, which means we can cover the entire market.” Operating in the Finnish energy market with access to Nord Pool is a distinct advantage for RAO Nordic. Nord


Oleg Zakataev, Managing Director

Pool (which includes Finland, Norway, Estonia, Sweden and Denmark) is the largest liberalised electrical energy market in Europe and the second largest exchange trading in EU emissions allowances (EUAs) and global certified emission reductions (CERs). Nord Pool’s international derivative products, clearing house and consulting services are provided in partnership with NASDAQ OMX Commodities. As Oleg Zakataev points out, “The Finish energy market is totally liberalised and transparent, with a clear regulatory environment and benchmarks, and is based on the Nord Pool price system.”

Reliable partner for domestic and foreign companies RAO Nordic has positioned itself as a reliable partner for foreign companies operating in Finland, and it welcomes the chance to establish new relationships. One

Energy & Sustainability

of its competitive advantages is its highly skilled team. Oleg Zakataev says, “In trading activities, it is crucial to have very professional and experienced employees, and we are proud that we have been quite successful in attracting high level experts to work with us.” He notes that Finland offers exceptional business opportunities thanks to its strategic location connecting the Nordic countries, Central Europe and Russia, as well as its EU membership and excellent business environment. The EU’s ambitious energy targets for 2020 have created more opportunities for RAO Nordic, which aims to take part in power and electricity projects geared to meeting 2020 goals. Oleg Zakataev says, “Finland is the best place to learn from when it comes to energy efficiency and sustainability. For example, Finland’s latest feed-in tariffs initiative for wind power is very attractive for potential investors. We aim to participate, invest, and partner in projects to build new wind parks through that initiative.” RAO Nordic welcomes the chance to get involved in other EU power projects. Oleg Zakataev says, “RAO Nordic and our parent company are very interested in participating in new power ventures, and having the opportunity to get financing through EU funds will be essential in helping us complete the projects and also take the experience back to Russia, which is also turning green. We plan to begin with smaller projects and then evolve gradually. Once we are ready to expand, the need for financing will increase, and we will need more cooperation with the EU and investors.”

One of RAO Nordic’s goals is to benefit its parent country, Russia. Oleg Zakataev says, “We have a unique opportunity to take the most advanced ideas and technologies, including our experience in the liberalised Finnish energy market, and export them back to our home country. This can help to create new partnerships between Russia and the EU more effectively than any political speeches could do! We have a history of bringing back home the trading experience and expertise we have gained here in Finland. So why not do the same with investments?” Addressing potential partners and investors, Oleg Zakataev concludes, “I see RAO Nordic as a business ambassador. We are open to any partnership with Finnish and European companies interested in joint projects to be implemented in Finland.”

RAO Nordic Oy Tammasaarenkatu 1 FI-00180 HELSINKI, Finland Tel.: +358 10 771 5510



Investing in Clean Energy Initiatives Finland’s clean technologies and renewable energy initiatives offer outstanding investment potential. Strong government support for renewable energy projects and a commitment to meeting ambitious EU energy targets are combining to drive forward both domestic and foreign investment in Finland’s energy sector. As the American Chamber of Commerce in Finland points out, “Finland is looking for investors, designers and developers to kick start its major energy development.”

Hydroelectric power station in Imatra

Europe’s fastest growing renewable energy market In fact, Finland’s renewable energy market is expected to be the fastest growing in Europe over the next five years. Cleantech Finland, an association of companies and organisations involved in clean technologies, notes, “Finland’s new feed in tariff system for wind and biogas and its commitment to meeting the EU target for Finland of increasing the use of renewable energy to 38% by 2020, which is amongst the highest in the EU, are creating outstanding investment and partnership opportunities.” For example, renewable energy initiatives such as the development of electrically


powered public transport systems, which require new battery and power conversion technology, are creating possibilities for suppliers.

Wind energy, wood chips Renewable energy production is a major growth area. Finland’s wind energy market is booming, with at least 1,000 new wind generators set to be built over the next decade. In addition, the use of wood chips for energy in Finland is expected to rise to at least 13.5 million cubic meters, an increase of 250%, and the government is providing an incentive package for the development of new small scale wood chip plants.

Energy & Sustainability

Focus on energy efficient housing Finland is also focusing on boosting energy efficiency in both existing and new buildings to help the country meet its target of reducing its energy use by 37 terawatt hours over the coming decade. Concerning new “green” housing, Cleantech Finland explains, “The markets for low energy and passive housing are underdeveloped in Finland compared to, for example, Germany, although consumer expectations for this sector are growing.” As for existing structures, a study by the Finnish property management chain REIM Group has found that many Finnish apartment blocks need upgrading to improve their energy efficiency. The study notes that most apartment buildings in Finland are fitted with ventilation extractor fans that blow heated air directly out of the building. “Fitting a heat recovery system would save the owners of such a building thousands of euros in a year,” the report points out.

Energy efficiency projects All projects to ensure energy efficiency offer particularly strong growth prospects in Finland. As Cleantech explains, “Finnish ICT and energy efficiency technologies are driving forces behind new smart grid and meter technologies, and a new law will boost the development of new user friendly Finnish smart metering applications in the coming years.”

Upgrading water and sewerage systems budgeted at €4 billion Finland is also committed to significant upgrades in its water and sewerage systems to make them more environmentally friendly and efficient. In fact, according to the American Chamber of Commerce,

the renovation of Finland’s water and sewage systems is expected to be worth some €4 billion by 2020. Finland is also promoting new recycling processes and technologies. Finland is currently below the EU average level of recycling and the National Waste Plan has set ambitious targets.

Incentives for FDI Finland is open to international companies offering new concepts and technologies to improve energy efficiency in housing, transport, waste treatment, energy production and industry. Foreign companies operating and investing in Finland are eligible for a wide range of government and EU incentives on an equal footing with Finnish companies. Foreign investors in Finland can benefit from several types of support, including investment aid, business development aid, subsidies for start ups, transport aid, energy subsidies, and tax relief on fixed assets. The state-owned financing company Finnvera plc offers a wide range of financial services, from loans and guarantees for start-ups and microenterprises to export credit guar-

antees for large exporters and their financiers. Tekes, the Finnish Funding Agency for Technology and Innovation, provides low interest loans and grants to challenging and innovative projects potentially leading to global success stories. In 2009 Tekes invested €343 million in the research and development and innovation activities of companies, and €236 million in public research carried out by universities, polytechnics and research institutes.

International partnerships Finland welcomes more international partnerships in energy and clean technology projects. In September 2010, representative companies from Cleantech Finland met with British companies in an event organised by UK Trade and Investment in an effort to find new ways of working together to develop clean technologies for a low-carbon world. Finland has also formed a partnership with Indonesia to develop bio-energy projects, and is ready to partner with other countries and companies to help it reach its ambitious energy sustainability goals.




Technology Leader Geared for New Energy Moventas is leader in the fastgrowing global renewable energy sector. Ranked one of the largest manufacturers of wind-turbine gears in the world, Moventas also manufactures power transmission solutions for industry and provides overhaul and maintenance services; services account for around one third of its turnover. In 2009, Moventas generated net sales of €237 million. It has approximately 1,200 employees in nine countries and has established a global network of partners. Moventas has 70 years of experience in developing cutting-edge technologies, and now it is focusing on orienting its technologies to the renewable energy sector. Its new slogan is “geared for new energy”. Jukka Jaamaa, President and CEO, says, “Our backbone is our strength in technology. We manufacture the best gears in the world, in which each tooth has an accuracy of one micron, one tenth the width of a strand of human hair. If wind turbines are to operate efficiently and reliably over a long period, they need a Moventas gearbox inside.”

Innovation, reliability, quality and transparency Moventas continues to focus on innovation to ensure its competitive edge. “We want to be the best


Jukka Jaamaa, President and CEO

Moventas is an example of Finland’s leading-edge in the global renewable energy sector; Finland is now ranked number four in this sector in Europe. Jukka Jaamaa believes that Finnish renewable energy companies need to work together to make Finland even more competitive. He concludes, “With our technology and innovations and high quality products, Moventas can create a great future for our customers and the world, and help the renewable energy sector move forward.”

in the world in our field. We already manufacture around 10% of the gearboxes used in wind turbines all over the world, and 99.9% of our turnover is from exports. We are known for innovation, reliability, quality and transparency,” Jukka Jaamaa explains. Moventas has always been proactive in providing what its customers need, and it aims to establish co-operative relationships with all its clients. “We believe that when our customers work together with us in perfect synergy, we will both achieve positive results faster,” Jukka Jaamaa points out. Jukka Jaamaa says that Moventas has invested around €200 million in technology development, added capacity and automated systems to make sure its production process achieves the highest possible quality. It has also established operations in the US, China and other markets to assemble products locally as a way of maintaining quality while reducing costs.

PO Box 35 Teknobulevardi 3-5 01531 Vantaa Tel.: +358 20 184 7882

Energy & Sustainability


Global Leader in Green Investments GreenStream is leading the way in green investments. Established in Finland in 2001, GreenStream is a pioneer in the green investment sector operating offices across Europe and in China. GreenStream develops, establishes and manages funds and other investment vehicles that invest in renewable energy and emission reduction projects. GreenStream has exceptional expertise in climate markets and mechanisms, including Joint Implementation and the Clean Development Mechanism projects under the Kyoto Protocol.

“It is essentially about financing projects” Jussi Nykänen, CEO, explains, “I have learned that what makes a difference is linking financing to policy. Technology doesn’t help if nobody uses it and a policy doesn’t help if nobody invests in implementing it. It all comes down to financing projects.” Building on the experience gained from working with the World Bank and other financial institutions, GreenStream has launched five own funds, and partnered

Jussi Nykänen, CEO

with the European Bank for Reconstruction and Development and the European Investment Bank to operate their Multilateral Carbon Credit Fund initially in Russia, Ukraine, Belarus and Kazakhstan and later also in the Baltic States. One of GreenStream’s specialities is to promote investments in small scale energy projects. Jussi Nykänen explains, “We realised that in order to make small-scale environmental projects move forward, someone has to combine the small projects into a larger package in order to attract financing. We help developers of small to medium-sized power production facilities in getting from nowhere to the marketplace.”

Growth means internationalisation GreenStream works closely with for example Cleantech Finland and TEKES (the Finnish funding agency

for technology and innovation) for encouraging smaller Finnish cleantech companies to expand beyond Finland’s borders. “The markets for cleantech companies are global in the same way as GreenStream’s markets. We have successfully grown our business to cover local presence in eight countries and are looking for large growth in China, where we are involved in a considerable number of projects. We want to share this knowhow with other companies targeting growth,” Jussi Nykänen says. He adds that GreenStream is committed to helping to brand Finland internationally as a place that creates technologies that make life easier. GreenStream‘s turnover was about €8 million in 2009 and the company manages over €150 million in assets in its funds, with a total investment capacity of around €250 million. Jussi Nykänen says, “Over the next few years, we intend to multiply the current assets of our funds to 3-4 -fold the current volume. The markets are booming and investors are increasingly interested in renewable energy and emission reduction project opportunities.”

Kluuvikatu 3 00100 Helsinki Finland Tel.: +358 20 743 7800 Fax: +358 20 743 78 10



MHG Systems

Innovative ERP System Providing Added Value to Bioenergy Companies MHG, founded in 2005, has grown to become a globally recognised supplier of cutting-edge bioenergy enterprise resource planning (ERP) systems. Earlier this year, MHG was ranked one of the top ten among 650 entries in the prestigious Logica Global Innovation Venture Partner competition held in Stockholm. MHG’s services provide significant cost savings and environmental benefits for all operators in the bioheat, bioelectricity, and biofuel production chain. Seppo Huurinainen, Managing Director, explains, “Our goal is to develop ERP solutions for the international bioenergy market. Subcontractors can operate with less supervision when they are controlled by our full ERP system, and our services are scalable to any kind of business model, including SMEs.” MHG utilises its partner network to produce customeroriented automation, IT and map service solutions designed for developing bioenergy and for fieldwork business operations.


MHG ERP synthesises mobile communications, the Internet, realtime maps, satellite-based location information, RFID technology, and CO2 monitoring into one business enhancing service. MHG’s ERP system allows for the use of new and empowering operational models, accurate cost monitoring, and realtime enterprise resource planning of biomasses and delivery chains.

Helping companies meet new EU bioenergy criteria MHG’s services are essential in helping companies meet new EU bioenergy certification standards and in avoiding illegal practices and inferior feedstock. Seppo Huurinainen says, “We have developed our technology based on physical monitoring and predicting moisture content. Our algorithm can predict, based on the history of that specific fuel, its moisture content and energy value. In this business, we should not talk about pounds or tonnes of feedstock, but rather its energy value. For small producers of biofuels, MHG’s ERP services can provide cred-

ibility and help the companies gain crucial prepayment for their products. Energy companies can use MHG’s services to make sure that the feedstock they purchase is not only high quality but also transported efficiently and in an environmentally friendly manner. MHG continues to invest significantly in research and development. It is just about to establish joint ventures, in China and Ghana, and is open to new partnerships. Seppo Huurinainen predicts that MHG’s annual turnover will reach around €2 million in 2011 and “tens of millions of euros” within five years, given the strong growth of the bioenergy market worldwide. He concludes, “We specialise in feedstock optimisation and in helping companies add value.”

Mikpoli Patteristonkatu 2 FI-50100 Mikkeli Tel.: +358 10 400 6280

Energy & Sustainability

Preseco Oy

World’s Leading Waste Refining Enterprise Seeking New Partners Preseco Oy, the world’s leading waste refining enterprise, specialises in innovative solutions related to waste, water and energy. Preseco has invested heavily in developing cutting-edge technologies in its field and has established a solid track record in providing comprehensive turnkey solutions for its customers worldwide.

of contacts, but we also want to get in touch with new companies.”

Exceptional investment opportunity

Mikko Kantero, Vice President and Member of the Board

Known for its waste-management services for the past decade, Preseco is now focusing on waste refining, according to Mikko Kantero, Vice President and Member of the Board, who adds that the company expects to increase its turnover in 2011 by 50%. “We provide a synergy of state-of-the-art technology and cutting-edge management. We have developed our own technologies and now we are taking them to the next level. We have our traditional waste-management business as well as our new refinery operation which integrates many technologies,” he says.

Composting plant

As a dynamic medium-sized company, Preseco has not only the expertise it needs to be innovative but also the necessary flexibility. Preseco is now looking for partners to help it achieve its ambitious goals. It is open to partnerships concerning the refinery operation or in licensing, joint ventures, or other areas. Mikko Kantero explains, “Preseco has invested around €20 million to become what we are today, so we have an attractive package to offer. We will bring great value into a partnership and the partners we are looking for will add their own value. We know that we can form two or three partnerships from our existing network

Preseco is also looking for investing partners. As Mikko Kantero points out, “Waste refining and management is a field where several conventional businesses are combined, including waste, energy, raw materials, chemicals and more, and some investors want to focus on just one. We are looking for a group of investors ready to invest in specific projects that combine these fields. There is great opportunity in the waste refining business today.” Mikko Kantero welcomes contacts from potential partners and investors. He concludes, “We want to change our mindset from waste management to waste refining, and to find partners who will join us in this new endeavour. At Preseco, we have developed an innovative, technologybased business concept which offers the promise of the highest returns on investment in the waste market.”

Keilaranta 17 FI – 02150 Espoo Finland Tel.: +358 10 835 8100



L&T Recoil

Using Innovative Technology to Transform Waste Oil L&T Recoil has devised an innovative way to recycle waste oil into high quality base oil. The company was launched by Lassila & Tikanoja (L&T), Finland’s biggest waste management enterprise, and by Ecostream, a trading company. L&T collects waste oil and related waste products; L&T Recoil refines these products at its new facility in Hamina, Finland; and Ecostream markets the end product for L&T Recoil. “Our modern refinery uses hydrofinishing technology to guarantee the high quality of the end product, which is base oil. Base oil is the main component in lubricant oils, and it is also used in cosmetic products, pharmaceuticals and various industrial applications as well,” explains Juha Kokko, Managing Director. L&T Recoil’s operation uses 66% less energy to process waste oil into base oil than a primary refinery

Encouraging countries to recycle rather than burn waste oil

Juha Kokko, Managing Director

uses to process crude oil, and thanks to its cutting-edge technology, L&T Recoil’s carbon dioxide emissions are 40% less than in a normal base oil refinery. The company aims to make more people aware of the potential of this new technology. Juha Kokko says, “We want customers to know that this new technology exists and that it works to recycle waste oil into useable products. In addition, our access to sea transport in Hamina allows us to operate with countries anywhere on the globe.”

L&T Recoil’s Hamina plant has the capacity to process 60,000 tonnes of waste oil per year, and the plant has already reached 70% of this capacity. Since Finland produces only around 20,000 tonnes of waste oil per year, L&T Recoil is ready to process oil from other markets. The company is seeking opportunities in Russia, only 25 km from its plant in Hamina, and in Latin America and Europe, where some countries – including the UK -- traditionally burn their waste oil. It is already processing waste oil from Africa. L&T Recoil is open to partnerships for new refineries. “We are certain that in our field, our Hamina plant’s technology is already the best in the world, but we are continuously upgrading it,” Juha Kokko says confidently. Over the next five years he aims for L&T Recoil to be the biggest refinery of its type anywhere. He concludes, “There is tremendous potential, especially if we can convince countries to stop burning waste oil.”

Hopeatie 2 PO Box 28 00441 Helsinki Tel.: +358 10 636 5618 Fax: +358 10 636 5612


• Keeping Construction Industry Globally Competitive

Construction & Infrastructure


Keeping Construction Industry Globally Competitive The Finland Pavilion built for Expo 2010 Shanghai illustrates the innovation, emphasis on sustainability, and international perspectives characteristic of Finland’s construction sector today. While other countries’ pavilions honoured the fair’s theme -- “Better City, Better Life” – by creating sustainable structures out of renewable materials using renewable energies, the Finnish pavilion went a step farther by interpreting “sustainable” not only in the types of construction materials and systems used, but also in the potential of the structure itself to be used in new ways through building information modelling (BIM) software. The buyer of the Finland Pavilion will be able to rebuild it as is or with one or two additional floors, using Tekla BIM software developed in Finland. The Finnish construction industry has historically been very successful, peaking in 1975 when almost 20% of Finland’s GDP came from construction investments. In 1994, recession stalled activity but the sector managed to recover, and is using the lessons learned then to continue to grow in a post recession environment.

Vision 2010 set new priorities for construction sector A decade ago, Rakennusteollisuus (the Federation of Finnish Construction Indus-


Finnish Pavilion Shanghai

tries, or RT), working with representatives from the public and private sectors, developed the Vision 2010 programme to help keep the Finnish construction sector globally competitive. One of the most important projects in the programme was PRO-IT5, a national data management method based on product modelling for the construction process. Vision 2010 also determined new challenges which Finnish construction companies should be able to meet in order to thrive. These include an increasing focus on building maintenance, since today’s buildings are of higher quality and have a longer life cycle

than those built in the past. As Vision 2010 points out, construction firms must recognise that customers might not be interested only in a construction project but rather in a total package: the construction itself coupled with repair and maintenance services after the building is in use. Vision 2010 also found that the construction industry will increasingly be characterised by the rapid implementation of new technologies, particularly information and communications technologies; new types of ownership and support functions; increased commitment to environmental values; greater internationalisation of investment

Construction & Infrastructure

and business operations in the construction industry; and an eroding distinction between residential and office construction. The report also cited the necessity for Finnish producers of construction materials to boost their competitive edge in international markets.

Focus on “green” construction The Finnish construction sector has taken the Vision 2010 precepts to heart by adapting its practices to fit new realities, and this is particularly clear in the growing focus on “green” construction, still a new field in Finland. As an RT study points out, buildings typically consume 30% to 40% of all primary energy used, and over 80% of the environmentally harmful emissions from buildings are due to energy consumption. Therefore, Finnish construction companies have been focusing on low energy construction alternatives. Aspects of “green” construction in Finland include simplifying the number of components and materials used, ensuring controlled ventilation and efficient heat recovery, improving thermal insulation, and using renewable materials and energy sources. Putting “green” construction precepts into practice, Sitra, the Finnish Innovation Fund, in collaboration with the City of Helsinki, launched a sustainable development design competition for a carbon neutral block in Helsinki in 2009 and the project is now in the implementation phase. It will serve as a national and international model for sustainable construction.

Exporting construction expertise Finnish construction firms are also exporting their expertise in “green”

Floating is the best timber transport alternative with regard to fuel consumption and carbon dioxide emissions

construction. In China, Finnish companies will participate in the construction of two digital ecological cities (DigiEcoCities) in Jiang Xi and Jiang Su, as well as a high tech ecocity in Mentougou near Beijing. As RT points out, “The model cities may not change the world, but will offer a model for the world to cope with the challenge of the massive urbanisation process ongoing in developing and emerging regions, and thus provide a seed of change in urban construction.”

New dimensioning system for wood products Meanwhile Finland’s construction materials sector is adapting to global market demands. The Finnish wood products industry – which accounts for the majority of Finland’s exports of construction materials – has begun

to draft a common dimensioning system for industrial scale prefabricated wood construction; the new system should be in use by 2013. The initiative, launched by Finnish Wood Research Oy, is designed to make products of different Finnish manufacturers compatible with each other with the aim of substantially increasing volumes of industrial scale timber construction. The project was launched in response to growing interest in multi-storey wooden buildings in Finland and other countries. Varying standards and building codes in different countries make exports of construction materials complicated, and the new system should help alleviate this problem for Finnish wood materials producers. Through such proactive measures, Finland’s construction sector is set to continue to thrive.



Glaston Corporation

Global Glass Leader Focusing on Innovation Glaston Corporation, headquartered in Tampere, Finland, is an international glass technology leader known for its pioneering glass processing technologies, machines and services. Glaston’s successful products include Bavelloni pre-processing machines and tools, Tamglass and Uniglass safety glass machines, and Albat+Wirsam software solutions. Glaston now operates in 20 countries and has production facilities in four countries on three continents. Arto Metsanen, President and CEO, joined the company a year ago to help Glaston cope with the effects of the global economic crisis. He explains, “When business is down, you have to use the time to improve your internal efficiency – particularly when it comes to innovation and product development. Therefore we have put a lot of time into research and development, creating new products and services that will definitely provide more added value for our customers. We aim to speed up the innovation process even more.”

customer companies that are the global leaders in the solar energy sector, finding ways to make the glass in solar panels more efficient,” Arto Metsanen points out.

Arto Metsanen, President and CEO

While the European market remains slow, Glaston has achieved a strong growth in its business in China and in South America, particularly Brazil. Arto Metsanen also foresees strong growth for Glaston in new EU member countries, where aging buildings are being torn down to make way for modern structures requiring the kind of expertise in which Glaston excels.

Solar panels, insulated windows Renewable energy represents a key growth area for Glaston, particularly concerning solar energy. “We are already working closely with

Glaston is also working to expand the market for insulated windows to be used not only in colder countries to retain heat in buildings, but also in hotter countries to keep buildings cooler. “We could achieve a 60% saving in cooling expenses in Rome, for example, by using such windows,” Arto Metsanen says. To promote innovation, Glaston organises a “Glass Processing Days” event in Finland every other year to bring together global leaders in its field to participate in discussion sessions. Glaston organises similar events in China and Brazil and plans to launch one in India. Arto Metsanen aims to promote even more co-operation among companies in Finland’s solar energy sector. He says, “We should create a solar energy cluster, a Finnish organisation of companies in which all benefit from our common knowledge and which allows us to bid together for major projects worldwide. Finland can demonstrate business acumen as well as innovation.”

Vehmaistenkatu 5 33730 Tampere Tel.: +358 10 500 500


Construction & Infrastructure

Walki Group

Cutting-Edge Packaging and Laminates for Global Markets The Walki Group illustrates the potential of Finnish companies to achieve international success in cutting-edge fields. Walki specialises in the production of fibre based, intelligent technical laminates and protective packaging materials. These products are used in diverse applications, from energy saving construction facings and insulation materials to barrier packaging materials for the paper industry, food and consumer packaging, decorative and functional laminates and more. Walki also creates specialist liners for solid and corrugated packaging and solutions for a range of technical applications.

Walki its competitive edge. As Leif Frilund explains, “We have competitors whose products always seem to be cheaper, but Walki is regularly chosen instead because we bring value and promising products each and every time. It is in our DNA to be reliable, honest and dedicated to the highest standards of quality consistency and uniformity. We aim for long-term relationships with our customers and suppliers, working openly and co-operatively with the supply chain to engineer value for all parties. We at the same time strive to make the process of working with us simple and easy.”

Leif Frilund, President and CEO

Walki operates state-of-the-art production facilities in Finland, Sweden, Germany, Poland, the UK and China, and the group achieves total annual net sales of more than €300 million. It has a 30% share of Europe’s market for specialist extrusion coated and laminated materials. Leif Frilund, President and CEO, explains that Walki aims to continue to expand internationally. He says, “We are present in 10 countries, operate seven production facilities, including in China, and we have sales offices in Asia as well as in Europe. We are in many ways a very European company, but

that is something likely to change as we further expand internationally.” This does not mean that Walki will not continue to expand in Europe, however; the group recently acquired a facility in Poland and regards Eastern Europe in general as a market with strong potential. “The group will continue to serve developing economies worldwide because growing economies need packaging materials, and that is what we are here for,” Leif Frilund points out.

Innovation and high quality Innovative combinations of materials and a commitment to quality give

Walki has always focused on research and development throughout its many years of doing business and plans to develop and produce even more innovative products in the future. Leif Frilund says, “We want to get into even more technical products with a focus on energy saving. We believe housing insulation is the product of tomorrow, and new insulation materials need the laminates we specialise in developing and producing. This is the direction we want to go: promoting renewable materials and energy conservation within the industries and wider society that our products serve.”

Ahventie 4 A 15 FI-02170 Espoo, Finland Tel.: +358 (0) 205 363 111


• Finnish Students Ranked World’s best on OECD Tests • Top 10 Reasons for Finnish Schools’ Success Story


“Because our teachers are so well trained, they are allowed to use their own teaching methods and materials to best resonate with their students.” Henna Virkkunen, Minister of Education and Culture


Excellence in Education Helps Give Finland Its Competitive Edge Finland has earned an outstanding reputation for the quality of its educational institutions, which include 16 universities and 25 polytechnic institutes. The OECD ranked Finland’s schools as the best in the OECD countries for the past decade based on Finnish students’ results on the OECD Programme for International Student Assessment tests. Around 140 delegations from different countries and groups came to Finland last year alone to observe the country’s successful educational system first hand.

Henna Virkkunen, Minister of Education and Culture

Showcasing Finnish education’s success story “We put together programs where they can observe our teacher training courses, classroom dyna-

mics, researchers at universities, school administrators and more, to allow them the direct opportunity to see how Finland’s educational system works,” explains Henna Virkkunen, Minister of Education and Culture.



She adds that this focus on excellence in education has helped to give Finland its competitive edge in fields requiring innovation, research and development. Finland combines affordability with high standards to achieve the highest quality educational system. Thanks to significant government support, all educational institutions in Finland are free, including for foreign students, and the teaching profession is in demand by young people looking for a career.

Teaching regarded as a prestigious profession Intense competition for spots in teacher training programmes reflects the prestige of the teaching profession in Finland. “This year approximately 8,000 students applied for teacher training programmes and universities selected only 800 of the best students. In addition, all teachers in public schools must have at least a Master’s degree. Because our teachers are so well trained, they are allowed to use their own teaching methods and materials to best resonate with their students. I believe that it is because of this latitude we provide our teachers in relating and connecting to their students that we have been honoured with such outstanding rankings,” Henna Virkkunen says.

Opportunities for international professors and researchers The government is currently working to make Finnish education more international, both by encouraging more Finnish students to study abroad for part of their school careers (around 20% already do) and by creating more opportunities for foreign students to study in Finland.


Both local and foreign students can count on free tuition at all Finnish institutions of higher learning. Henna Virkkunen adds, “We are not only looking to attract foreign students but also international professors and researchers. However, attracting international students to Finland does present us with a challenge, due to a perception that we are a far away Scandinavian country as well as the fact that Finnish is a very complex language, which can present a barrier to students wishing to enter our universities. We have implemented steps to combat this challenge. Now, many universities in Finland offer courses in English. In fact, Finland offers the most English led courses in our polytechnic institutes than any other non-native English speaking country in Europe.”

“An education policy based on the principle of lifelong learning strengthens society, gives citizenship new meaning and increases welfare.” Partnerships between public sector and universities Close cooperation between the public sector and universities has also enhanced the quality of Finnish higher education. As the minister points out, “This is a tradition that dates back quite some time. Information technology companies, for example, very frequently cooperate with our universities to advance their research base and expand their market share. Nokia is a great example of a company that works

closely with academic institutions to better its research and products. It is extremely important for our economy that this unique collaboration between academia and the private sector continues to take place.” The minister adds that while continuing to partner with the public sector, Finnish universities will soon have more autonomy through the new University Act.

Emphasis on sustainability The minister notes that Finland launched an education strategy for the period 2006 to 2014 which emphasises sustainability. The strategy’s mission statement explains, “We have to include the whole population within our education policy; everyone must acknowledge their responsibility when it comes to creating an ecologically, economically, socially and culturally sustainable future. An education policy based on the principle of lifelong learning strengthens society, gives citizenship new meaning and increases welfare. The education system is an important way of transmitting values, information and skills.”

Focusing on key strengths While Finnish students’ exceptional results on international tests continue to make headlines, Finnish universities have not been involved in promoting themselves, but that is changing. “Branding universities is a very new concept in Finland, but international rankings of universities are becoming increasingly important worldwide. I believe that it is important for Finnish higher education institutions to focus on what they are good at as opposed to attempting to be the best at everything. Because our universities are smaller, this is the best way for them to compete,” the minister believes.


University of Helsinki

Finland’s Leading University Heading for the Top The University of Helsinki, ranked Finland’s top university, is known for its internationalism and for its research activities; it is Finland’s only university which is a member of the prestigious European League of Research Universities. Rector Thomas Wilhelmsson explains, “It is the role of universities to be international, and the University of Helsinki is certainly Finland’s most international university. We have around 2,500 foreign students from around 90 countries as well as around 1,000 foreign researchers on our staff, but we would like to recruit more. This university is very well known in Finland but we need to market ourselves globally.” The university’s efforts are paying off; it attracted 7% more applicants in 2010 than in 2009 and has been quite successful in garnering EU research funding. Now Thomas Wilhelmsson would like to enhance

ties between the university and the private sector. He says, “In some areas we already work closely with the private sector, for example in pharmaceuticals and the food industry, but we believe that in other areas we could offer the private sector much more than we currently do.”

Opportunities for investment and partnerships The University of Helsinki is involved in basic as well as applied research at the highest international levels, and it regularly funds around two to three start-up companies each year. More support is needed to bring ideas to the marketplace, however. Thomas Wilhelmsson points out, “The biggest problem in the Finnish innovation economy is the lack of sufficient risk capital. We need to make the business sector and investors more aware of our research capacities.” Another goal for Thomas Wilhelmsson is to make sure that top foreign students at the university can find jobs in Finland when they graduate. He says, “We are developing a multi-million euro project, partially funded by the EU, to enhance recruitment possibilities for our foreign students. We need more foreign labour, and what could be better for the Finnish workforce than to attract intelligent people from all over the world who have received a good education at our university?” Over the next five years, the rector aims to double the number of the

Thomas Wilhelmsson, Rector

university’s foreign students and staff and to boost its international ranking. He says, “The University of Helsinki is ranked among the 50 - 100 best research universities in the world. We know that in the top 20 universities, there is only one nonAnglo-Saxon university. It will not be easy, but we aim to be in the top 25 worldwide.”

PO Box 33 Yliopistonkatu 4 00014 Helsinki Tel.: +358 9 191 22211 Fax: +358 9 191 23008



Finnish Students Ranked World’s best on OECD Tests Finland’s students achieve such stellar results on a variety of international tests that educators from all over the world routinely visit Finland to discover the secrets of the success of its education system. Finnish students achieved the highest scores in the world in science and reading on the OECD’s PISA exams for 15 year olds in 2006, and came in second only to South Korea in mathematics.

Quality, efficiency, equity and internationalisation Overseen by the Ministry of Education and Culture, education in Finland is characterised by quality, efficiency, equity and internationalisation. As the Ministry explains, “Education is a factor for competitiveness. The current priorities in educational development in Finland are to raise the level of education and upgrade competencies among the population and the workforce, to improve the efficiency of the education system, to prevent exclusion among children and young people, and to enlarge adult learning opportunities. Special attention is also paid to quality enhancement and impact in education, training and research, and to internationalisation.” In the Finnish philosophy of education, everyone has something to contribute and those who struggle in certain subjects should not be left behind. So how does Finland do it, especially in an educational system that


is public and free, and in which, according to the OECD, students spend less time in the classroom than in schools in other developed countries? One factor is the availability of teachers to serve students with special needs. An additional teacher is almost always on hand to assist students who are struggling with a particular subject, but such students are kept with the group rather than being segregated.

New pilot programme for gifted students A new goal is to provide additional support for the brightest students. Minister of Education Henna Virkkunen points out that while the current Finnish system provides all kinds of help for students with learning difficulties, pupils who are very talented are

not always served. She notes that Finland has now launched a pilot project for gifted students. Another feature of Finnish education is that students can stay in the same schools from the start of their school years (which begin at age seven, later than in most countries) to the end of secondary school, since primary and secondary schools are combined. This eliminates potentially difficult changes of schools and also gives teachers in-depth understanding of each student’s strengths and weaknesses. The theory behind the late start is that children will have had a lot of time for play and will be ready to learn.

Family support a key factor Family support is another key factor behind the success of Finnish education, since most


Finnish parents read to and with their children at home and have regular contacts with teachers and school administrators. In addition, unlike in many countries, teaching is considered a prestigious career choice in Finland, and teaching standards are high. Finnish classrooms are known for their relaxed and informal atmosphere, which seems to be another positive contributing factor, and Finland’s low immigration means that few students have to cope with Finnish as a second language. The Ministry of Education and the National Board of Education are responsible for implementing education policy and for administering the education system at the central government level, although many matters are decided by the education and training providers themselves. National core curricula have been established at the primary and secondary levels. General education and vocational training are co-financed by the government and local authorities.

Higher education forging knowledge-based economy Higher education institutions in Finland are of two types: universities, which focus on research and scientific and artistic learning; and polytechnics (also known as universities of applied sciences) which focus on professional higher education and applied research and development. Adult education and training are available at all levels and largely financed by the government. The Ministry of Education is currently working to step up international links in Finnish higher education, both by encouraging more Finnish students to study abroad and by recruiting foreign

students and professors for Finnish universities and polytechnics. As the Centre for International Mobility’s web site “Study in Finland” points out, “higher education plays a significant role in Finnish society and in the national innovation system: higher education makes a crucial contribution towards a worldclass knowledge society.”

polytechnics offer Bachelor’s and Master’s degrees. A student is eligible for Master’s level studies after accomplishing a Bachelor’s degree, and having at least three years of relevant work experience after that. All studies are quantified as credits which are recognised by the European Credit Transfer System. One year of full time study corresponds to 60 credits.

All 16 Finnish universities operating under the Ministry of Education confer Bachelor’s, Master’s, licentiate and doctoral degrees, while

From age seven to the end of a doctoral programme, the Finnish education system provides exceptionally high quality instruction.



Top 10 Reasons for Finnish Schools’ Success Story Finnish students have consistently scored at the top of international tests, and educators worldwide have tried to determine the reasons behind the success of the Finnish education system. According to the World Bank, “The performance of this small and remote European country springs directly from education policies set in motion 40 years ago.” Characteristics of successful Finnish education include the following:

All children equal in creative primary system Children begin school at age seven when they enter a compulsory, free primary school, which they attend for nine years. All children begin at the same level, no matter what socio-economic backgrounds they have. They learn the basic knowledge, skills and attitudes of lifelong learning, which pays off in better academic achievement in later grades. At these primary schools, teaching is creative in that


playing and learning are combined with alternative pedagogic approaches.

All teachers have at least Master’s degrees All teachers are trained in academic universities and must achieve at least a Master’s degree to qualify for a permanent teaching job. Teaching is a highly respected career in Finland and only 10% of the 5,000 applicants for teacher training pro-


grammes each year are accepted to the faculties of education in Finnish universities. While other countries try to improve their public school systems by privatising schools or constantly testing students, Finland chose to upgrade qualifications for teachers and then to allow these teachers considerable leeway in the classroom concerning the methods they use.

Strong government support for education Finland’s education system has received strong government support since the 1960s thanks to a belief that only through education can Finland manage to compete in the global economy. All Finnish governments for the past 40 years, whether liberal or conservative, have viewed education as a key driver for Finland’s economic development. The government’s approach is to substantially boost investments in education and research to foster innovation.

Free schools mean more focus on teaching Because the central government ensured sustainable funding to ensure free tuition, warm school meals, learning materials, text books, transportation, new equipment, new facilities, student counselling and more for all students in all primary and secondary schools, teachers are able to focus on teaching and learning, and bringing new ideas and practices into schools.

No emphasis on standardised tests Finland does not use mandatory standardised exams except for

the nationwide National Matriculation Examination, which is given at the end of the upper secondary school when students are around 18 years old. Teachers devise their own assessment tests and do not use numeric grades but rather descriptive feedback; they avoid comparing students with each other. This approach is believed to have fostered a fear free atmosphere in classrooms and has helped teachers and students focus on learning, creativity and risk taking. Teachers also have more freedom when they do not have to prepare for and give standardised annual exams.

Autonomy for schools and teachers The Finnish system offers autonomy to both schools and teachers. While the Ministry of Education and Culture oversees the education system and sets core curricula, it trusts schools, administrators, teachers and parents to work together to provide the best possible education for their children and youth. The National Board of Education does not dictate lesson plans or standardised tests. Schools can plan their own curricula to reflect local concerns.

Schools stimulate regional development Finland’s higher education system includes universities and polytechnics. The polytechnics are considered key to promoting regional development, increasing technology, environmental sciences and entrepreneurship. Regional support networks have been created to help schools and teachers adopt new technology in education and incorporate technology into classrooms.

Teachers’ voices are heard Teacher unions and educators themselves have always had the opportunity to be heard and to help achieve any necessary reforms to the education system. All experimental education projects involve teacher participation in their planning as well as monitoring by university professors with the aim of promoting a consistent innovation culture in the education system. Finnish teachers maintain their pedagogical freedom, creativity and sense of professional responsibility through choosing textbooks and learning materials as well as determining the best way to cover the curriculum.

Public-private cooperation Government leaders, trade unions and employers’ organisations always work together to reach common goals, unlike in many other countries where such groups are in opposition concerning education policies.

Schools serve their communities Schools are not separate from the communities and regions in which they are located, but rather work in partnership with local institutions to ensure education which fits local needs and helps spur on local economic development. In a 2005 report, the World Bank concludes, “Although Finland has many characteristics that cannot easily be replicated by other countries, much of its experience in designing knowledge-based economic and social strategies is highly relevant. A key lesson is the importance of flexibility in responding to change, and the critical role of a responsive education system.”


• Digital Finland 2020 • Communications Sector Forging Information Society


“Digital services could become a significant opportunity for growth for Finland.” Digital Finland 2020


Digital Finland 2020

Starting off the new year with an innovative scheme, the Federation of Finnish Technology Industries published a report on January 1, 2011 entitled Digital Finland 2020, which presents a vision of how the use of information and communications technology (ICT) can create success in different sectors of the Finnish economy. The report is based on the premise that the ‘smart’ industry with its services and wide ranging digitalisation could ensure Finland’s global competitiveness in the communications sector over the coming decade.

Building on existing strengths to reach new targets “Finnish ICT will find its place where global forces of change, its own areas of strength and new targets for investment intersect,” says Hannu Hernesniemi, Research Director at Etlatieto Ltd, the company which produced the Digital Finland 2020 publication. He adds, “Forces of change such as the aging population, urbanisation and the growing emphasis on environmental and energy issues create demand in areas where Finns have a great deal of expertise. The success of businesses depends on their finding a strategic position in those international ecosys-



nificant opportunity for growth for Finland. However, this requires the creation of an internal market for digital services within the EU. It has been estimated that this could lead to GDP growth of as much as 4%.”

tems where such issues are researched, piloted and launched onto the market.” Digital Finland 2020 predicts that the international ICT sector will grow faster than the global economy as a whole, and that the Internet will become a central facet of infrastructure in a wide range of fields. “Every sector will need electronics, software and embedded systems created from them. Digital technology will become a part of our everyday lives through appliances and entertainment systems and through services. The combination of mobile technology and the Internet, applications and, for example, sensor technology is of particular importance in the case of Finland,” the report states. Digital Finland 2020 encourages increasing digitalisation of public-sector services in order to improve productivity, create better support for citizens and increase effectiveness. “New initiatives based on open platforms would also offer business opportunities to many service providers,” the report points out. The public sector should also develop innovative pilot projects and engage in public purchases that would help spur on Finland’s digital ICT activities, the report believes. “The significance of centres of cutting-edge expertise in conducting interdisciplinary research is also great. The willingness shown by the private sector to invest should be met with public sector SHOK funding,” Digital Finland 2020 says.

EU digital services market Many communications industry experts in Finland point to the need for an EU digital services market, and Digital Finland 2020 concurs. Tommi Juusela, Chairman of the Research Project Steering Group and Nokia Corporation’s Director for Content and Development, observes, “Digital services could become a sig-


Finland is already cutting edge in its digital applications. Finland’s broadcasting market was one of the first in Europe to become entirely digital; digital terrestrial TV has been operating in Finland since mid 2001, interactive TV has progressed well, and mobile TV, with two competing providers, is among the most advanced in Europe. TeliaSonera, cablecos and other providers offer bundled services to a growing market, while network upgrades have helped consumer access to services.

100 Mbits connections for every household “The government’s plan for every household to have fibre based 100 Mbits connections by 2015 will dramatically improve the commercial potential of convergent services and IP delivered content providers,” Digital Finland 2010 concludes. In an even more surprising digital initiative, residents of Finland can receive their mail electronically by participating in a pilot project by state-owned national postal service Itella. Postal workers – bound to secrecy – will scan residents’ mail and then the residents will be notified by e-mail when they receive new letters. They can then read them for free by logging on to a website called Netposti. The digital distribution will only be provided to people who choose to participate. Digital delivery of letters is provided in Switzerland and the US, too, but customers in those countries have to pay for it – at least €14 per month.

Vision of Finland’s future While Digital Finland 2020’s goals are ambitious, Finland has already proved it can reach challenging targets, and its leaders continue to be driven by their visions of what the country can be. In a recent survey of business leaders undertaken by the American Chamber of Commerce in Finland concerning Finland in 2020, Aape Pohjavirta, CEO of Sendandsee Ltd., commented, “My dream is that Planet Earth 3.0 – the global post industrialised community – is built with digital services that utilise the cornerstones of Finnish society: education, entrepreneurship, equality, and honesty. In my 2020 vision, Finland becomes the leader in shaping a better future for all people on our planet.”


Communications Sector Forging Information Society Finland is known for its liberal, forward-thinking approach to communications; it was the first country in the world to define Internet access as a universal service that must be available to everyone.

Finland is also famous for its quick adoption of cellular phone and wireless technology. About 60% of Finns had mobile phones by 1999, compared with 28% in the US. Finnish giant Nokia, along with dominating domestic mobile phone sales, also supplies almost a quarter of the world’s mobile phone market. Internet connectivity is also very high in Finland. At the end of 2009, Finland had a total of nearly 7.7 million mobile connections and almost 2.5 million broadband connections in service; there were 377,000 more broadband connections than at the end of 2008. As the Ministry of Transport and Communications points out, this growth is explained by the increase in the total number of mobile broadband connections.

High speed 100 Mbit broadband available to all by 2015 As the first country in the world to define a 1 Mbit Internet connection as a universal service, Finland continues to serve as a pioneer in the field of information society development. The government

aims to make high speed, 100 Mbit broadband connections available to nearly all permanent residences and offices of businesses and public administration bodies in Finland by the end of 2015. Finland’s communications sector is currently characterised by rapidly increasing data traffic. As the Ministry of Communications and Transport observes, “The growth in the total number of computers and third generation mobile phones is reflected in the total number of broadband connections. The number of mobile connections in Finland has reached

saturation point, while the number of traditional landline calls has decreased dramatically.”

Small, advanced and competitive telecom market Compared to other EU telecom markets, the Finnish telecommunications market is small, but also advanced and competitive. The sector is overseen by the Ministry of Transport and Communications and by the Finnish Communications Regulatory Authority (FICORA).



to transform Finland into an “internationally recognised, competitive, competence-based service society with a human touch,” according to the ministry.

Increased productivity through information society In November this year, the Ministry of Transport and Communications submitted to parliament the “Productive and Innovative Finland Digital Agenda for 2011-2020” which defines objectives for Finland’s information society along with measures necessary to achieve them.

Finland’s telecommunications industry was fully deregulated by 1995, and subsequent laws have allowed telecom companies to share lines and have eased entry into the sector by eliminating the licensing requirement previously needed to construct a fixed telephone network. Phone tariffs are among the lowest in the EU.

Competitive market conditions, reasonably priced services Finland’s Minister of Communications Suvi Lindén was recently invited to join the UN’s high level Broadband Commission for Digital Development, which aims to find solutions for creating effective broadband connections and information society services for people in developing countries. She comments, “The invitation is an acknowledgement of Finnish communications policy. The core of our policy is to create competitive market conditions but also to take firm measures to ensure everyone’s right to reasonably priced communications services. That is why


broadband was made a basic right in Finland.”

E-services rapidly developing Finland has been rapidly developing e-services, and the government is committed to the idea that a knowledge-based society requires high quality e-communications services which are generally available at reasonable prices. “Citizens and businesses must be able to trust in the services offered by the information society,” the ministry points out. Finland’s communications policies aim to ensure access to basic communications services throughout the country as well as the availability of affordable high quality communications services. Key requirements also include information security and confidentiality of communications. Finland’s communications development strategy for 2007 to 2011 focuses on promoting the information society for everyday life and aims

Key objectives outlined in the proposal include the opening up of access to public data and its efficient use, promoting user-oriented service development, securing the position of ageing people as active citizens, and promoting sustainable development by adopting new technologies. The ministry notes that content and services play a major role in the development of digital Finland; services need to be user friendly and secure, and designed to meet the needs of everyday life. Aspects such as multilingual versions of services and their accessibility need to be considered early on at the planning stage. Concerning the EU and international digital markets, Finland supports freer circulation of web content and services, which the ministry says paves the way for the emergence of creative economy business models. The government’s aim is that measures to develop the information society be based on network thinking and extended across sectors. The needs of people and society provide the starting point for service development.

• Foreign Trade Minister Cites Finland’s Strong Fundamentals • Intelligent Transport Positioning Finland as Logistics Hub • Modern, Multi-Modal Transport Infrastructure • Finnish Expertise in Container Shipping


“Finland provides a sustainable environment for businesses of all kinds, as well as being stable, innovative, and within easy access of the EU and many growing markets.” Paavo Väyrynen, Minister of Foreign Trade


Foreign Trade Minister Cites Finland’s Strong Fundamentals Finland’s trade based economy has been hit hard by the global economic downturn, but Minister of Foreign Trade and Development Paavo Väyrynen is optimistic about the future because of Finland’s very solid fundamentals. He explains, “Finland is actually a miracle. After World War II we were still a developing country and were required to pay heavy war compensations, but nevertheless in only a few decades we have become a global leader in many high tech fields. Finland provides a sustainable environment for businesses of all kinds, as well as being stable, innovative, and within easy access of the EU and many growing markets.”

Paavo Väyrynen, Minister of Foreign Trade

Paavo Väyrynen’s ministerial career began in 1975 when he was appointed Minister of Education for the second government of former Prime Minister Miettunen. He has served in several governments and in fact is the second longest serving minister in Finland’s history. He was


appointed Minister of Foreign Trade and Development in April 2007.

Strong ties with China The minister points out that while Finland’s main trading partners


are Germany, Russia and Sweden, the country’s trade with China has grown so rapidly that now Finland is China’s top trade partner in the Nordic region. “Finnish companies have been very active in Asia for a long time, and we are expanding our trade there,” he explains.

but it is also cool in the summer when other parts of the world are very hot. We also have uncrowded ski centres and luxury hotels, and Helsinki has become a key international air travel hub,” the minister points out.

During a visit to Hong Kong and Shenzhen in October 2010, the minister commented, “The special arrangements for economic development in Southern China have enabled rapid growth of the economy and trade, and Finnish companies have had a role in this. At the same time as Southern China offers impressive horizons for both Chinese and global markets, it is also good to remember Finland’s importance to Chinese businesses as a gateway to the rest of Europe – the shortest route from Asia to Europe is by way of Finland.” He highlighted the example of the Golden Bridge Chinese Innovation Centre in Finland, which is the first Chinese innovation centre to be set up abroad.

“Finland is well known for its green energy technologies. Here in Finland, we have been blessed by hard meteorological conditions and a lack of energy resources. This has compelled Finnish companies to be creative!”

Minister Väyrynen is also targeting Latin America and Africa, and says that Finland will of course continue to trade with neighbouring countries in the Nordic and Baltic regions as well as with the EU. He predicts particularly strong growth in trade with Russia.

Significant advantages for business

The renewable energy sector offers significant investment potential in Finland, Paavo Väyrynen believes. He says, “Finland is well known for its green energy technologies. Here in Finland, we have been blessed by hard meteorological conditions and a lack of energy resources. This has compelled Finnish companies to be creative!”

Concerning Finland’s investment potential, Paavo Väyrynen points out that while production costs in Finland are relatively high, this is balanced out by the country’s stability, well-developed infrastructure and pro business environment. Finland also offers significant tourism potential. “Finland is cool in the sense that it is trendy

Finland is known worldwide for its successful information and communications technology companies, including Nokia, as well as for its thriving enterprises in the mining, machine building and other sectors. “We are a small country and many of our companies have specialised to become really good at what they do,” Paavo Väyrynen points out.

The minister adds that Finnish companies should make efforts to work as partners. He explains, “With a few exceptions, Finnish companies are small from the global perspective, and so the more effectively we are able to benefit from one another’s strengths through cooperation, the better our possibilities are.”

Promoting wood construction worldwide One example is for enterprises in Finland’s high potential wood industry to work together to help launch an extensive international programme for promoting wood construction. “Increasing wood usage is an effective tool for fighting climate change. A single cubic metre of wood can store about a tonne of carbon dioxide. According to calculations, a 10% increase in wood construction in the EU would account for 25% of the Kyoto emission targets,” Paavo Väyrynen says. Minister Väyrynen believes that boosting wood construction would also have a substantial positive impact on the Finnish economy, for example by creating new opportunities for cooperation with Russia. “Energy efficiency, climate change and environmental issues are expected to emerge as guiding factors for Russian decision making. Russian authorities have already started paying attention to promoting wood construction in their programmes. A common interest will create vast opportunities for bilateral forestry cooperation and Finnish companies operating in Russia,” he believes. Väyrynen spoke on Wednesday, 8 December at the publication of a report by the working group on promoting wood construction he appointed in the spring of 2010.



Intelligent Transport Positioning Finland as Logistics Hub Finland has developed modern transport infrastructure to help it capitalise on its strategic location, and it welcomes investment in transport and logistics activities.

According to the investment promotion organisation Invest in Finland, Finland offers the fastest and the most congestion free transport route from Europe to Russia and Asia as well as a reliable and safe business environment, seamless handling of goods between transport modes for faster transfer times, and efficient global transport links by road, sea, air and rail. Finland’s location next to Russia has made it a particularly important hub for the transhipment of goods arriving from Russia by sea.


Strategy for Intelligent Transport 2010-2015 To enhance its transport infrastructure, Finland carried out major reforms of its transport administration in 2010 and created the new Finnish Transport Agency. In addition, Finland has launched an ambitious action plan for intelligent transport for the period 2010 to 2015. The plan aims to make Finland’s transport system one of the most advanced and efficient in the world by 2020.


The Strategy for Intelligent Transport includes new services designed to make transport safer, more efficient and more environmentally friendly through implementing stronger links between conventional transport systems and cutting-edge information technology. The plan focuses on key projects which are to be completed by a wide range of participants. A national advisory board for intelligent transport will be established to help move the programme forward. Harri Pursiainen, Permanent Secretary at Finland’s Ministry of Transport and Communications, says that intelligent transport will be addressed as a central transport policy tool in the government’s Transport Policy Report of 2011.

New Finnish Transport Agency promoting R&D The new Finnish Transport Agency (FTA), headed by Director General Juhani Tervala, will facilitate Finland’s transport programmes and help step up investment, research and development in transport infrastructure. Juhani Tervala says, “An important task is to consolidate not only Finland’s road, railway and sea transport modes, but also the research and development concerning these modes. Consolidation is now the new theme. Simultaneously, the FTA should possess the country’s highest expertise in each transport mode. The role of the FTA is to be a leader in the transport field, including in R&D.” He notes that one focus will be R&D concerning public transport.

International cooperation a key feature The FTA aims to launch long-term, large-scale research projects while

nesses. ERTICO’s mission is to serve as a link between industry, infrastructure operators, transport users, and national actors coordinating issues related to intelligent transport.

Helsinki to host new regional transport and logistics organisation

also being ready to react quickly to new research demands. “In the future, the work will involve much international cooperation,” Juhani Tervala says. The FTA will be working closely with Finnish universities from the outset. Finland’s National Strategy for Intelligent Transport has already received international recognition. The Finnish Ministry of Transport and Communications and Harri Pursiainen, who drafted the new strategy, received the eSafety Award 2010 at the international eSafety Forum held in Brussels in October 2010. The award recognises the new strategy as well as such innovative initiatives as Finland’s eCall, an automatic emergency call system. “Intelligent transport will have a growing importance in European transport policy in the coming years. It is delightful and encouraging to see Finland rewarded for its forwardlooking work,” Harri Pursiainen commented at the awards ceremony. The eSafety Forum is organised by ERTICO, a cooperation body for public authorities and private players in the field of intelligent transport. It was founded by the EU Commission, Ministries of Transport of the EU member states, and European busi-

In another sign of Finland’s leadership role concerning transport issues, Helsinki has been chosen to host the Northern Dimension Secretariat on Transport and Logistics (NDPTL), which aims to improve transport connections and logistic processes among the Northern Dimension countries (Finland, Germany, Poland, Sweden, Denmark, Lithuania, Latvia, Estonia, Russia, Belarus and Norway). The NDPTL will serve as an umbrella organisation to supervise regional cooperation and mobilise funding for improving major transport connections among Northern Dimension countries. “The creation of the NDPTL is an important milestone in the strengthening of the transport market in an area at the crossroads of West and East and North and South. I am glad to see the willingness of EU and non EU partners to plan tomorrow’s transport system from a regional perspective, rather than a national one,” comments Siim Kallas, Vice President of the European Commission. The new partnership will cover all modes of transport, including road, rail, inland waterways, aviation, and maritime. It will focus on both infrastructure and non-infrastructure related bottlenecks with the aim of improving transport connections and logistic processes among the countries of the region. Its work will help make Finland even more attractive as a business base and logistics hub.



Modern, Multi-Modal Transport Infrastructure Modern infrastructure and logistics are key strengths of Finland’s domestic economy and its lively trade with the EU, Russia and Asia. Finland’s transport infrastructure includes excellent roads, airports and railways, as well as a vast network of waterways, canals and sea lanes.

Rail system Finland’s rail network extends around 5,700 km, around half of which has been electrified. The railway system is steadily being expanded and upgraded, and rail freight transport activities were opened to competition in 2007. One recent rail project is the high-speed Allegro train between Helsinki and St Petersburg, which began operating in December 2010. It cuts travel time between the cities to just three and a half hours. Two daily services will run from both cities, increasing to four daily services by summer 2011. Helsinki’s international airport is expected to draw EU-bound traffic from St. Petersburg, whose airport is known for congestion and delays, thanks to the new rail link. At the Allegro opening, Finland’s Minister of Transport Anu Vehviläinen commented, “The fast rail service brings the metropolitan areas of Helsinki and St. Petersburg closer together, enables faster movement of people, and benefits tourism and business life.”


Ports and waterways About 90% of Finland’s exports and around 70% of its imports are transported by sea, and the government has placed a high priority on ensuring the continued development and competitiveness of Finnish maritime transport. The Finnish Transport Agency is involved in a waterways development plan for 2007 to 2016 whose prime objective is to guarantee the maintenance and safety of existing shipping lanes. Finland has some 8,200 km of coastal waterways and 8,000 km of inland waterways for a total 16,200 km, of which 3,900 km is used for merchant shipping. The waterway network also includes the Saimaa Canal, which leads from Lake Saimaa to the Gulf of Finland.

The Saimaa Canal and the Deep Channel The Saimaa Canal opened in 1968 and remains a key transport route. Finland and Russia cooperated on the original dredging, and of the canal’s total length of 42.9 km, Finland leases to Russia the 19.6 km portion located in Russian territory, while 23.3 km of the canal are in Finnish territory. Today, thanks to the canal’s deep channel, vessels with a 2,500 tonne carrying capacity can navigate from the inland waterways of Eastern Finland via the Saimaa Canal to all European ports and to inland ports in both continental Europe and Russia. Finland’s ports garner international praise from shipping companies. At a major transport trade fair in Moscow in 2010, Eduard Musienko, General


Director of Eurosib Sbp Transportation Systems, commented, “Although we have bigger ports in Ust-Luga and St Petersburg, their quality does not reach the level of Finnish ports. The Russian ports have been promising to improve their level of quality for ten years, but they still cannot compete with Finnish ports. From a business perspective, the best shipping route from Russia is via Finland.”

Air transport Finland has 24 airports serving air freight and passenger traffic, including the Helsinki-Vantaa Airport, which is ranked among the world’s best international airports in IATA and ASQ surveys. Helsinki-Vantaa offers global connections to more than 120 destinations and is an increasingly popular gateway to Asia as it gives access to the most direct route between Northern Europe and Asian destinations. Finavia Corporation is responsible for maintaining Finland’s air navigation system and its main airports, which are being developed into an integrated network.

70% of goods transported by road Almost 70% of goods transport within Finland is by road. Finland has around 78,000 km of public roads, of which around 13,300 are class I and class II main roads and around 700 km are motorways.

Ounaskoski bridge in Rovaniemi

Finland’s road network is being modernised with the participation of foreign companies. The E18 motorway will be extended eastwards and the section between Koskenkylä and Kotka will be carried out as a long-term service

agreement; foreign companies bid for the project. Skanska built the E18 between Muurla and Lohjanharju, which opened in 2009. It will enable traffic volumes to increase from 8,400-11,000 vehicles per day in 2000 to 14,700-19,200 vehicles per day in 2030. Another new road project will make Finland a pioneer in environmentally friendly road construction. A stretch of motorway being built in Vaalimaa, south-eastern Finland, will have charging stations for electric cars, biofuel stations and solar panels. The project’s goal is to create an ecological motorway model which can open up new opportunities for Finland internationally. The new green motorway, budgeted at around €700 million, will connect Turku and Vaalimaa in 2016.

Nordic Triangle Project The multimodal Nordic triangle scheme is currently upgrading road, rail and maritime infrastructures in Finland as well as in Sweden; it will improve freight and passenger transport between the Øresund fixed link, Stockholm, Oslo,Turku, Helsinki and the Finnish-Russian border.



Finnish Expertise



in Container Shipping Container shipping is a key activity in Finland’s transport sector, since around 90% of Finland’s exports and around 70% of its imports are transported by sea. As Anu Vehviläinen, Minister of Transport points out, “The continued development of Finnish maritime transport and the need to ensure its competitiveness are essential.” Maritime transport in Finland is overseen by the new Finnish Transport Agency.

Port of Helsinki well equipped for container traffic

Public sector support for Finland’s maritime transport sector totals around €95 million per year. To help boost revenues and employment opportunities in its shipping sector, the Ministry of Transport has introduced a tonnage taxation system aimed at decreasing human resources costs. Shipping companies are exempted from tax withholdings, and employers’ payments are reimbursed. The system that was originally applied to cargo vessels was extended to cover passenger vessels at the end of 2007. Finland has taken a very international approach to its container shipping activities, and the Ministry of Transport participates in the International Maritime Organisation, the Baltic Marine Environment Protection Commission (the Helsinki Commission, or HELCOM), and other European and global organisations concerned with shipping.

Among the world-class Finnish companies operating in the port is Containerships Oy, the Finnish group which now has 18 offices and a presence in 16 countries. It handled 210,000 TEU in volume in 2010.

Focus on safety Safety is an important concern. As the Ministry of Transport points out, “International cooperation and agreements play an extremely important role in ensuring vessel safety. One example of EU level cooperation is the decision to accelerate the introduction of double hull tankers. Minister Anu Vehviläinen’s office has been an active participant in the development of the Vessel Traffic Management and Information Service (VTMIS) for traffic using the international waters of the Gulf of Finland. In the VTMIS system introduced in 2004, Finland, Russia and Estonia together monitor shipping in the Gulf of Finland, and the vessels themselves have a reporting obligation.” The Finnish Transport Safety Agency is responsible for ship safety, ship and port security and, in collaboration with other authorities, for the protection of the marine environment. It is also the competent pilotage authority in Finland.

The Port of Helsinki is a leader in handling container traffic and contains extensive container handling, warehousing and logistics facilities. The logistics area next to the port’s Vuosaari Harbour houses logistics service providers which provide incoming and outgoing cargo loading and unloading, containerisation and recontainerisation, short-term storage and other logistics operations.

Growing traffic with Russia Containerships Oy specialises in shipments to and from the Russian market, a fast growing market for Finnish shipping enterprises. As Russia’s imports continue to grow, Russian port facilities have proved less capable of handling the increase in container shipping than their counterparts in Finland, and continued expansion in Russia bound container traffic at Finnish ports is anticipated. Goods transported in containers via Finland to Russia arrive mainly from Far Eastern ports to the ports of Kotka and Hamina, from which most goods are, after intermediate storage, transported by truck to Moscow and St. Petersburg. The busiest border crossing for such shipments in Finland is Vaalimaa, which has experienced increasing traffic congestion and will be the target of infrastructure projects designed to speed up transit times.

Emphasis on environmentally friendly shipping As a leader in environmentally friendly practices and technologies, Finland aims to make its shipping industry as “green” as possible. Leading shipping companies have implemented the latest EU and international environmental standards, while environmental permits for Port of Helsinki operations stipulate environmental protection requirements for both passenger and cargo traffic. The Port of Helsinki’s environmental management is based on ISO 14001 requirements.



Containerships Oy

Container Shipping Specialist a Gateway to European Markets Containerships Oy, owned by Container Finance, is a family-owned Finnish company which has been thriving for over 40 years. Containerships Oy offers comprehensive door-to-door transport of any type of containerised cargo as well as terminal and warehousing services. Containerships Oy focuses on the European market and specialises in emerging European economies. CEO Sigurjon Markusson explains, “We have a particularly good position in the emerging markets of Eastern Europe and the Mediterranean, including some Northern African ports. Our main focus right now is on developing these markets further by increasing the frequency of our services and enhancing our door-to-door service solutions. Our network covers 21 ports in 16 countries.” Containerships Oy operates 15 vessels and emphasises frequency of service, making around 2,500 port calls per year. Its vessels call at St. Petersburg six times per week, Rotterdam and Teesport five times per week, Helsinki four times per week, and at least two times per week at Klaipeda, Riga, Istanbul and Izmir. Russia is the company’s biggest market, accounting for around 45% of its TEU volumes, followed by Helsinki, Lithuania, Latvia, and Turkey. The Baltic region accounts for two thirds of the company’s business. “Our owner, Container Finance, is the only foreign company in Russia which has invested in its own port in St. Petersburg. In addition, we have our own facilities here in the port of Helsinki and 18 overseas offices,” Sigurjon Markusson says.

Containerships Oy continuously invests in new technologies to further improve its service. In December 2010, Containerships Oy signed a turnkey contract with Wärtsilä, the marine industry’s leading ship power solutions provider, to retrofit a Wärtsilä fresh water scrubber for the vessel Containerships VII, which is equipped with a Wärtsilä W7L64 main engine. The conversion will enable the vessel to meet future Sulphur Emission Control Areas (SECA) criteria as well as International Maritime Organisation and EU environmental regulations. Containerships Oy is committed to responding quickly to market and customer demands and to taking an innovative approach to its business. “We make very fast decisions and we are one of the most transparent companies you can find,” Sigurjon Markusson concludes.

Rapid, environmentally friendly transport Around 90% of Containerships Oy’s activity concerns pallet wide containers, and its speciality is 40 ft by 45 ft containers, which can compete with trailers in loading capacity. Containerships Oy can offer rapid transit times which are comparable to those of train and trailer shipments yet much more environmentally friendly.


Containerships Ltd Oy Mannerheimintie 15a 00260 Helsinki - Finland Tel.: + 358 207 441 441

Arctia Shipping

Maritime Services Enterprise Offers Unique Expertise Arctia is helping to build a thriving maritime services sector in Finland. The company plays a crucial role in the national economy, especially since more than 80% of the cargo going to and from Finland is transported by ship. Formerly known as Finstaship, Arctia is still state-owned, but it has been reorganised to function as a private company and is working to be even more competitive in Finland’s open market.

Tero Vauraste, President and CEO

Arctia provides a range of high quality maritime services which include icebreaking (accounting for €20 million of the company’s €50 million in annual turnover); offshore services for the oil and gas sector (€20 million); and ferry service throughout the Finnish archipelago (€10 million). Except for its ferry service, Arctia provides its specialised services worldwide.

Combining offshore services and icebreaking Tero Vauraste, President and CEO, explains that Arctia provides icebreaking services for vessels operating in the Baltic region in the winter and year-round offshore services for oil and gas enterprises as well as the construction firms serving them. In the future, the company aims to focus on a combination of these two services. “Arctia’s competitive edge is its expertise in operating in arctic conditions with ice, combined with its expertise in offshore services and oil recovery. We plan to focus more and more on offshore services in arctic conditions. Most of our competitors con-

centrate on one or the other, not both,” Tero Vauraste says. He foresees significant opportunities for Arctia in Alaska, northern Russia and Greenland. Arctia aims to invest in new icebreaking ships and equipment and would like to obtain partial financing from client companies. “Most of the key clients in this business are already in our portfolio, but we will certainly not turn any client away, and any potential client should know that we are the only company with experience in offshore services, arctic offshore services, icebreaking, and oil recovery,” Tero Vauraste says. Arctia has signed a contract with the European Maritime Safety Agency to use its ships to help to handle oil spills and other serious maritime accidents. Tero Vauraste explains, “We can reach an accident area in northern Europe quickly, even if in ice, and we recently proved that the operative window for oil recovering by icebreaker is wider than expected – the system was functional to the wave height of 2.9 meters which is above the average. An oil-recovering tanker cannot do everything that we can do. Arctia gives added value.” Arctia is open to joint ventures and other types of partnerships. It is clearly set for strong growth.

Keilaranta 10 - FI - 02150 Espoo - Tel.: +358 30 620 7000 -


• New Tourism Development Strategy for 2020


“Eco tourism can help increase employment opportunities in Finland’s rural areas.” Mauri Pekkarinen, Minister of Economic Affairs


New Tourism Development Strategy for 2020 Finland recently launched a new national tourism development strategy for 2020 which aims to take advantage of the country’s unique position as a neighbour to Russia, its attractive tourism regions, and the diversity of its tourism offerings. Easily reached from anywhere in the world via Helsinki’s international airport, Finland is ready to carve out a bigger share of the global tourism industry.

The new tourism strategy pinpoints three basic trends in international tourism which Finland will take into account: an increasing demand worldwide for “green” tourism; the growing importance of the Internet in promoting tourism destinations and in serving potential visitors; and new demographics in the global tourism market, particularly an aging yet affluent population in search of new destinations which nevertheless provide modern services. “Finland’s tourism industry must also recognise new kinds of customer segments and their wishes or requirements – in other words, we must operate in a user and demand oriented manner,” the strategy document explains.

Helsinki Harbour

“Green”, sustainable tourism development Mauri Pekkarinen, Finland’s Minister of Economic Affairs, points out that Finland is committed to “green”, sustainable tourism and that the country’s unspoiled nature is one of its strong points. He adds that eco tourism can help increase employment opportunities in Finland’s rural areas. The minister also calls for “the development of new, experimental tourism innovations.”

The new tourism strategy also focuses on improving the business environment for tourism entrepreneurs, upgrading tourism infrastructure throughout the country, and creating more training opportunities for human resources in the tourism sector. Finland also plans to step up its tourism marketing, both domestically and internationally. “To achieve intensive growth, tourism development activities will focus on two strategic focus areas: the development of tourism centres and



their spheres of influence, and the development of theme based products and services,” according to the new strategy.

Boosting tourism’s share of GDP to 5.1% by 2020 Finland’s tourism sector currently employs around 130,500 people either full time or part time, and in 2007 the sector’s share of Finland’s GDP was 3.8%. The new strategy aims to boost tourism sector employment to 171,000 people and increase the sector’s share of GDP to 5.1% by 2020. Overall revenues from Finland’s tourism sector reached €14.9 billion in 2009, in spite of the recession, and are expected to be well above that this year, according to the Ministry of Employment and the Economy. While tourism demand fell in 2009, it bounced back in 2010, and around 65% of Finland’s tourism enterprises, including ski resorts, expect their turnover to rise in 2011. Numbers of both domestic and foreign tourists are expected to increase this year as well.

Turku: European Capital of Culture 2011 Many of these tourists will travel to Turku, European Capital of Culture in 2011; the city anticipates two million visitors over the year. Turku has a wide range of tourism attractions year round, including a 13th century cathedral and well-preserved ancient wooden buildings in its historic city centre. This year, the city will also present a diverse range of around 155 innovative cultural events. Turku’s cultural offerings include Aboa Vetus & Ars Nova (Old Turku & New Art), a modern art gallery with an archae-



ological museum underneath it, which combine to showcase Turku’s past and present. The city’s vast new arts complex will host shows, concerts and exhibitions throughout the year, including Fire! Fire!, an interactive exhibit about the conflagration that destroyed 19th century Turku, and The Dancing Tower, a performance featuring the Turku AB Dance Company. Turku will also present a revival of the rock musical “Hair” and a major, year long exhibit of contemporary photography titled “Alice in Wonderland” which will be the largest exhibition of contemporary photographic art ever held in Finland. Turku overlooks an archipelago with more than 20,000 islands, many of which can be visited by public transport. Utö, the furthermost inhabited island in the archipelago, will host events as part of the Contemporary Arts Archipelago project this year. An event titled Nordic Voices will draw professional storytellers from

across Europe to Finland’s capital of culture to share tales both ancient and modern, while a program titled Poetry Portraits will offer participants the chance to spend anywhere from several minutes to hours with poets. Various cultural activities in Turku this year will illustrate the theme “Culture Does You Good”. Saara Malila, spokesperson for Turku’s 2011 programming, explains, “We want to emphasise that culture has a positive impact on mental and physical well being, and we are the first European Capital of Culture to concentrate on this aspect.”

Finland’s unique appeal Turku’s innovative approach to its year as European Capital of Culture illustrates Finland’s special appeal for visitors: Finland is a country with a unique character, in an off the beaten track yet easily accessible location, and it offers both great natural beauty and exciting, unusual tourism attractions.


Hotel Helka

Authentic Finnish Atmosphere in City Centre Hotel Hotel Helka offers a true taste of modern Finland in its streamlined design, hospitable service and stylish decor focusing on Finnish nature. Opened in 1928 and extensively remodelled in 2006, the hotel is a favourite among business and leisure travellers to Helsinki. It has 150 rooms and suites offering all the comforts and services of a superior three-star hotel, as well as two fully equipped apartments for guests seeking long-term accommodations. The hotel has won many prizes for its decor, which includes furnishings by famed Finnish designer Alvar Aalto and a stunning ceiling in the lobby with images of the Finnish countryside. General Manager Henry Laine explains, “We try to be typically Finnish, and to encourage our guests to experience not just Helsinki but also the Finnish countryside and unique flora and fauna, including our arctic regions.” With private owners (YWCA Finland), Hotel Helka sets itself apart from

Henry Laine, General Manager

typical international luxury hotel chains through its authentic Finnish atmosphere as well as its personalised services.

Sauna with views of the city Guests can relax in the sauna facilities on the hotel’s top floor and enjoy views of the city as well as a cosy lounge with a fireplace. The hotel’s services for business guests include two fully equipped conference rooms, one accommodating 30 guests and the other 70, as well as a meeting room seating 12 on the sauna floor.

gives guests a chance to try delicious Finnish specialities like reindeer, wild mushrooms and berries as well as gourmet dishes based on the freshest local fish, game and vegetables. The restaurant, decorated with a vast mural picturing a Finnish forest, serves a sumptuous buffet breakfast daily. Helkan Keittiö also offers catering services for any type of event. The overall aim behind the hotel’s recent makeover was to ensure that it had an authentic Finnish style. As Henry Laine points out, “The building was designed and built with quality in the 1920s, so that people would have a good place to stay. Hotel Helka has always been known as a cosy hotel in the heart of the city. Now the new look and Finnish design with its furniture, lighting and textiles supports Helka’s reputation as a relaxed and easygoing hotel in the city centre. At the Hotel Helka, you will experience the real Finland!”

The hotel’s convivial bar is a great place to relax, and the restaurant, Helkan Keittiö (Helka’s Kitchen)

Hotelli Helka*** Ravintola Helkan Keittiö Pohjoinen Rautatiekatu 23 FI-00100 Helsinki Finland Tel.: +358 9 613 580



Authentically Finnish Attractions Finland – easily reached from anywhere in Europe and beyond via Helsinki’s award winning international airport – has significant potential to become a top tourism destination. Finland offers unspoiled nature, snowy winters, pleasantly warm summers and a colourful spring and autumn. Finns are considered to be cool – quiet and reserved – but they are actually warm, friendly and hospitable. Whether visitors opt to check out sophisticated Finnish design in Helsinki, sail from island to island in the Finnish archipelago, fish on one of the country’s pristine lakes, or have a close encounter with a herd of reindeer in Lapland, Finland has something for everyone all year long.

Helsinki and surroundings

ice and snow blankets buildings, the city takes on a magical new identity. Turku, Tampere and more

Finland’s capital city, only a two and a half hour flight from London, has a population of 500,000 and is easy to explore on foot or by tram. Set on the sea with many parks and gardens, Helsinki often surprises international visitors in summer with its many sidewalk cafes and outdoor cultural activities. It is a treasure trove of architectural styles and boutiques where shoppers can purchase examples of fine Finnish brands like Iittala and Marimekko. In winter, when Helsinki’s harbour is covered with

Turku (Åbo in Swedish) is Finland’s oldest city and first capital, founded in 1229. It has a medieval cathedral, the historic Old Great Square, Turku Castle in the harbour, and medieval cobblestone streets stretching beside the Aura River in the heart of the city. Visitors can cruise in the archipelago or sail from Turku Harbour across the Baltic to Sweden. Turku has been designated the European City of Culture in 2011 and a wealth of cultural activities are scheduled all year.


Tampere, set between two lakes, offers spectacular views from Pyynikki ridge and the Näsinneula in Särkänniemi Amusement Park. Visitors can stroll along the banks of the Tammerkoski river where old red brick factory buildings have been turned into museums, galleries, restaurants, cinemas, theatre, art and craft stalls, and boutiques. Rauma, a UNESCO World Heritage site, is located in an area of untouched beaches, sand dunes, bridges and lush pastures leading to the sea. Rauma’s wooden town centre dates from the 18th and 19th centuries; the town of Porvoo is also known for its well-preserved wooden architecture.


Coastal areas and archipelago Finns love water and for generations have built lovely wooden houses along lake shores and seasides. In Hanko, visitors can view elegant villas built as retreats by wealthy residents of St. Petersburg. There are over 20,000 islands in the Finnish archipelago, and boat rentals are available by the day, week or longer for those who want to go island hopping. Sites on the islands include Finland’s oldest churches, many dating back to the 12th century, and restaurants serving fabulous crayfish buffets and barbeques.

Lakeland and North Karelia Finland’s lake district in the southeastern part of the country is the largest lake district in Europe. It is a paradise for fishing and water sports, while North Karelia is an ideal base for lovers of winter sports.


A taste of Finnish cuisine

Finnish Lapland in Finland’s far north has its own special character year round. In summer, it offers bicycle trails, white-water rafting, fishing, canoeing and even a chance to pan for gold. In winter, many travellers head to the provincial capital, Rovaniemi, on the Arctic Circle, to visit the real Santa Claus. The town is also home to Arktikum, a museum honouring the region. Husky safaris, snowmobiling, ice fishing, and endless winter sports are all on hand here.

For a true taste of Finnish culture, visitors can sample treats like salmiakki and lörtsy: the former is a salty liquorice candy while the latter is a thin half moon shaped meat pie originally invented in Savonlinna, Finland. Other authentically Finnish dishes include reindeer with lingonberry jelly, fried vendace (fish) from the Savo lakes, wild duck with chanterelle mushrooms, and fresh caught lake crayfish.

Culture tourism

Northern lights in Lapland

Finland is also a culture lover’s paradise. Finnish music, design and technical innovations are world famous and travellers have a chance to get acquainted with them all in concert halls, museums, boutiques and cultural venues in Helsinki and beyond. Around two million music and theatre lovers attend Finland Festivals events each year; events feature jazz, rock, opera and folk, chamber music and blues, theatre and ballet.

Along with snow shoeing, dog sledding, skiing, ice skating, biking, hiking, tennis and much more, sports lovers can try some eccentric new sports like cell phone throwing at the annual World Cell Phone Throwing Championships. Fashion shoppers will seek out top Finnish brands like IVANAhelsinki and Hanna Sarén, Tiia Vanhatapio, Minna Parikka (shoes) and Globe Hope, a collection made of recycled materials. There is truly something for everyone in surprising Finland.




Service Gives Car Hire Leader Its Competitive Edge Hertz Finland is number one in its sector and offers all the top quality services that have made Hertz a global car hire leader worldwide. The company, owned by Volvo, has 71 rental offices all over the country (including eight in Helsinki) and is ready to provide international travellers, locals and corporate clients with a range of vehicles and special rental plans. Hertz’s extensive network is especially important in the Finnish market, given the great distances within the country. People skills also make the difference at Hertz Finland. As CEO Hannu Mikkonen explains, “Our well-educated workforce gives us an advantage. It’s important in our business for our people to have language skills, and we focus on empowerment so that our staff will always be able to make the best decisions for the company and for the client.”

Value for money Prompt response to customers’ needs and a reputation for providing value are other reasons that Hertz is the local leader. Hannu Mikkonen says, “Our customers know that if there is ever a problem with a vehicle, we will come to them and replace the vehicle immediately. In addition, if our customers travel abroad, we can take care of them in other countries, and they can always make reservations in their own language thanks to the global Hertz reservations system. For corporate customers, the Hertz#1 Club Gold offers a number of additional advantages. We give good value for money to all our clients.” Hertz Finland will continue to expand its state-of-theart fleet to respond to growing demand and aims to offer new options such as hybrid and electric cars as well as to continue to adopt the latest technologies. Hertz Finland is also participating in a trial programme to promote car sharing in a system in which customers use a code to access a car only when they need it. Hannu Mikkonen explains, “From Hertz Internation-


Hannu Mikkonen, CEO

al’s point of view, Finland is a good place to test such innovative programmes because this is a very high tech country and Finnish people respond well to new technologies. In addition, owning a car is expensive here and Finnish people are very environmentally conscious. I believe that what Hertz Finland implements will eventually spread to other countries.” Hannu Mikkonen urges international investors and travellers to look into opportunities in Finland and to call on Hertz for their car hire needs.

Hertz Finland Reservations +358 200 11 22 33 Sales and Customer Care +358 20 555 2000

Hotel Isaacs Dublin is a superior 3 star luxury hotel in one of Dublin’s most central locations. Situated beside the IFSC and well served by public transport links, Hotel Isaacs is an excellent base for the business traveller. The Conference Centre Dublin is a short walk from the hotel as is The O2 Arena, Croke Park and the Dublin Docklands business area. There are conference facilities available in the sympathetically restored Georgian wing of Hotel Isaacs and guests can avail of complimentary use of our Business Centre. The hotel is WiFi enabled.

Hotel Isaacs Dublin Store Street - Dublin 1 - Telephone: +353 1 813 4700 - Fax: +353 1 836 5390 -

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