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Finnish economic growth outlook lags behind in eurozone: central bank

Xinhua, December 10, 2015 Adjust font size:

Finland's central bank said on Thursday that the Finnish economic outlook for growth still remains gloomy, and the growth rate will be minus 0.1 percent this year, 0.7 percent in 2016 and 1.0 percent in 2017.

The Bank of Finland said the economic growth in Finland is clearly lagging behind other countries in the eurozone, due to the sluggish growth of the world trade and the uncompetitive domestic labor costs.

The bank downgraded the forecasts from the previous outlook made in June, which was 0.2 percent this year, 1.2 percent in 2016 and 1.3 percent in 2017.

The problems in the Finnish economy have turned out to be perennial since 2008. Recovery is gradually getting underway, but in 2016 Finland will be one of the most weakly growing economies in the euro area, said the bank.

"The outlook for the Finnish economy is burdened by industrial restructuring, weakened cost-competitiveness and a contracting working-age population," explained Erkki Liikanen, governor of the Bank of Finland.

He added that turning this trend around requires determined solutions to improve the cost-competitiveness.

Finland's public finance still remains fragile. The general government debt will exceed 68 percent of GDP (gross domestic product), and in 2017 it will be more than twice the level of 2008, according to the bank.

Structural reforms are needed to achieve economic growth and strengthen the sustainability of the public finances, emphasized the bank. Enditem