Finland’s economic contraction continued in October, signaling the country’s recession may have extended into the fourth quarter.
Gross domestic product adjusted for the number of working days shrank an annual 0.7 percent in October, after a revised 1.6 percent drop the month before, Helsinki-based Statistics Finland said on its website.
The economy, which relies on exports for a third of its output, sank into a recession in the second quarter, hurt by a contraction in the euro area. Manufacturing and construction shrank an annual 1 percent in October, while service output remained unchanged from a year ago, the statistics office said.
“We need more jobs and faster economic growth,” Finance Minister Jutta Urpilainen said, according to an e-mailed copy of a speech given to her Social Democratic Party today. “Export industries have a significant role in the Finnish economy.”
Finnish exports to the European Union fell an annual 10 percent in November. The drop was led by a decline in sales of electronics, iron and steel, the latest data by Finnish Customs showed Jan. 7.
Manufacturers, including engineering company Metso Oyj and papermaker UPM-Kymmene Oyj, are moving production closer to their customers in emerging markets in response to a global shift in demand. UPM’s Raflatac label-making unit is investing in China and Vietnam, and has opened distribution terminals in Mexico City and Buenos Aires in the past year.
Metso plans to expand its biomass business in China and India as growing urban populations drive up energy demand, while European governments cut back support for clean power, Martin Ridderheim, vice president of Helsinki-based Metso’s power business, said on Nov. 8.
“Our industry has been challenged by a quiet tsunami over a longer period,” Urpilainen said. “60,000 industrial jobs have disappeared in the past four years. We must ensure our export industries remain competitive.”