– Nokia’s crash forced Finland to consider a hard truth it had been ignoring: The economy’s traditional mainstay, the paper industry, is being killed by the very same tech innovation that fed the national economy in the 2000s. Unemployment is at 7 percent now, much lower than during the 1990s crisis, but it’s growing and, with the end of the tech boom, it’s hard to say where new jobs will appear. “It remains uncertain whether other sectors can consistently compensate for the output loss in Finland’s wood and paper industry and its electronics industry,” S&P wrote, explaining the downgrade. –
– Finland’s lesson for Europe is that growth is all about competitiveness. Big, diversified economies need more than one miracle like Nokia to thrive. And that takes a flexible labor market, a free economic environment and, yes, some government investment in infrastructure, research and development. It makes little sense to pin all hopes on monetary stimulus, as the French government appears to be doing in the face of its own looming S&P downgrade. –
Prime Minister Stubb, at least, gets the message – does yours??? …˝He calls the downgrade a “wake-up call” and says Finland needs to speed up structural reforms.˝
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