Bloomberg the Company & Products

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Magazine

The Nokia Economy


Policymakers these days trek to Finland from all corners of the globe. The question is always the same: How did Finland, land of pulp and paper, become a tech powerhouse, home to a global champion like Nokia?

Rewind to the early 1980s. That's when Finns, worried that the economy was too dependent on the USSR, set up the National Technology Agency to finance cutting-edge industries. Research spending rose from 1.1% of gross domestic product in 1982 to 3.4% in 2002.

The economic effects were dramatic. In the late 1990s, growth topped 5% a year, productivity boomed, and unemployment was halved. Massive telecom technology investments transformed old economy conglomerate Nokia Corp. (NOK) into the world's No. 1 maker of mobile handsets, accounting for more than 20% of Finland's $54 billion annual exports.

Call it the Nokia economy. The company's $3.5 billion annual spending on R&D, together with supplier contracts and outsourcing, has helped nurture hundreds of startups, including successful software maker Digia Inc. "The entire university system has been fine-tuned to serve the needs of technology companies," says founder Pekka Sivonen. Digia is hiring dozens of software experts. It's just a growth dividend from Finland's investment in R&D. By Gail Edmondson in Frankfurt


LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus