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Economic Developments



Economic growth in Finland has been faster than anticipated, and statistical revisions have also led to an upward adjustment in estimates for growth and productivity for 2024 and 2025. GDP is projected to grow by 1.6% in 2026, 1.8% in 2027, and 1.5% in 2028. While households remain cautious in their spending, strengthening purchasing power and improved confidence are expected to accelerate consumption growth, particularly next year. Defense procurement, data center projects, and the energy transition are boosting investment; however, residential construction remains weak, with a recovery not expected until next year. Employment will continue to decline this year, with growth projected to begin only from 2027 onwards. The unemployment rate will exceed 10% this year.

The general government deficit stood at 3.8% of GDP in 2025. Although an improving economic climate is boosting public sector revenues, strong expenditure growth is pushing the general government deficit to 4.2% of GDP this year. While an economic upturn is increasing indirect tax revenues, the currently subdued employment trend is tempering the growth of income tax receipts and slowing the decline in unemployment-related expenditures. Reductions in earned income taxation that took effect at the beginning of the year—along with a planned reduction in the corporate income tax rate next year—will slow the growth of tax revenues this year. Between 2027 and 2030, the deficit is projected to be approximately 4.5 percent of GDP. The debt-to-GDP ratio is estimated to rise to 90 percent this year, and by 2030, debt is expected to reach nearly 98 percent of GDP.

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