Finnish Finance Minister Matti Vanhanen of the Centre Party has warned that the country's economy is presently confronted with “dangerously high” risks that may be further exacerbated by a second wave of the coronavirus.
According to Matti Vanhanen, the first wave of COVID-19 and measures to slow down the spread of the virus have created a deficit worth almost €20 billion ($23.5 billion) for Finland.
“If a second wave takes place, it’ll also require countermeasures. We’re now better prepared, so hopefully we won'tt have to shut down the domestic market as completely, but it would surely have a significant impact on our economy”, Vanhanen told the tabloid daily Iltalehti.
He warned that the crisis would have far-reaching consequences if exports fail to bounce back in the near future. For instance, Finnish exports to Germany and Russia plummeted to about half of their usual levels in May.
Furthermore, he emphasised that the coronavirus hasn't been brought under control in key economies of the world, such as the US, which remains the worst-hit nation with nearly 4.5 million cases and over 150,000 fatalities, and stressed that an investment slowdown is looming for Finland.
According to recent figures from Statistics Finland, the unemployment rate was 6.7 percent in June, meaning there were 47,000 more people unemployed than at the same time last year. Various economic forecasts have boded a 2020 GDP fall for the Finnish economy of up to 8 percent.
Recently credit rating agency Moody’s encouraged Finland to make haste with fiscal adjustment and employment measures in re-affirming its AA1 rating and stable outlook for the country, warning it would otherwise consider negative rating action.
Financial expert and former Director General of the Finance Ministry Peter Nyberg previously cautioned that Finland has fallen behind in relation to other Nordic countries.
“I would think that the notion of Finland being close to Germany is outdated”, Nyberg told national broadcaster Yle. “In my opinion, Finland is Northern Europe's sick economy, we are, so to speak, Northern Europe's own Southern Europe”.
While relatively mildly hit by the coronavirus with some 7,400 cases and 329 deaths, Finland saw a protracted lockdown, during which the entire capital area was cordoned off.
