Ministry for Foreign Affairs warns about hard Brexit

The Ministry for Foreign Affairs of Finland has warned the Finnish business life of a hard Brexit. Terhi Bunders, a Brexit contact person at the Ministry, says that they aim to raise awareness of all alternatives.

Jussi Mustonen of Confederation of Finnish Industries EK points out that the impact of soft Brexit on Finland’s gross domestic product is approximately 0.1-0.2% while in a hard Brexit, the GDP could be cut by 0.3%. According to Mr Mustonen, it would not make Finland fall, but it is awkward and harmful to Finland’s economy.

Juha Kilponen of the Bank of Finland adds that even if there were major problems with trade after Brexit, it would not be a blow to Finland, because only 5% of Finnish export goes to the UK. If uncertainty over the Brexit agreement persists, it could cause problems if it affected the financial markets. An uncontrolled Brexit would also weaken Finland’s growth outlook.

In Finland, particularly the forest industry is worried about Brexit. The industry fears that tariffs will significantly rise from the current zero. However, based on the most recent information, paper, cardboard and pulp would avoid tariffs even if there was no deal on Brexit.

The uncertainty over Brexit is however already affecting some businesses, such as the health technology sector. For example Planmeca, which has noticed a decline in demand, is following the Brexit negotiations with concern.

Media:  Ilkka , YLE Uutiset
Date: 2.10.2018
Journalist: –
Main source: Terhi Bunders, Jussi Mustonen, Juha Kilponen

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