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Published: 18 June 2020

Gross domestic product grew by 1.1 per cent in 2019

According to Statistics Finland's updated preliminary data, the volume of GDP grew by 1.1 per cent in 2019. The initial preliminary data released in March put the rate of growth at 1.0 per cent. Gross domestic product, or the value added created in the production of goods and services, amounted to EUR 241 billion.

Annual change in the volume of gross domestic product, per cent

In 2018, the volume of Finland's gross domestic product grew by 1.5 per cent (1.6 per cent in the previous calculation round). Minor updates have also been made to the data for 2016 and 2017 and the data released for 2016 are now final when the supply and use tables are completed.

As concerns enterprise data for 2019, there is now more uncertainty than usual in the preliminary data in the summer. The coverage of the annual data was not normal as some enterprises had obtained more time to deliver the data related to the corona crisis. This uncertainty particularly concerns the cost structure of enterprises. The data will be revised in the early part of next year, when the final annual data for enterprises will be available. Normally, around one-third of enterprises' figures are still based on quarterly data in the preliminary data in the summer. Because of these reasons, the publication accuracy of database tables for 2019 is less detailed than the final one.

Supply

Value added at current prices increased by 3.2 per cent

Value added is calculated as the difference between output and intermediate consumption. Of these items output at current prices grew by 3.7 per cent to EUR 453 billion in 2019. The volume of output grew by 2.3 per cent and the price of output increased by 1.4 per cent. The current priced value of intermediate consumption increased by 4.2 per cent to EUR 245 billion. The volume of intermediate consumption went up by 3.1 per cent.

The value of gross domestic product calculated from value added, taxes on products and subsidies was EUR 241 billion. Value added grew by 3.2 per cent to EUR 208 billion. The current priced value of taxes on products grew by 1.4 per cent and amounted to EUR 33 billion. The relatively small increase in the accrual of taxes on products is explained by the decrease in the accrual of taxes belonging to the category “other taxes on products than VAT and import taxes”. In lowering the accrual of these other taxes on products, the most significant factors were energy taxes, motor car and motorcycle taxes, and profits from gambling activities. Revenues from value added tax without municipalities' VAT returns grew by 2.4 per cent.

The 2.8 per cent increase in current priced imports boosted total supply. The value of goods imports fell by 0.7 per cent but service imports grew by 10.2 per cent. Import prices increased by 0.4 per cent and the volume of imports grew by 2.4 per cent.

Value added in the non-financial corporations sector grew by 3.8 per cent in 2019

The value of non-financial corporations’ output grew by 4.0 per cent in 2019. Intermediate consumption grew by 4.1 per cent. The growth in value added was roughly as fast as in 2018, even though the growth in output was lower than in the previous year. This was affected by that non-financial corporations' expenses grew faster than their income in 2018.

The volume of financial intermediation and insurance fell as expenses grew faster than income

In 2019, the current priced value added of the financial and insurance corporations sector decreased by 5.5 per cent. The volume of value added fell by 8.6 per cent, because intermediate consumption grew clearly faster than output in the financial and insurance corporations sector. In the industry of financing, the fall in value added was partly due to international enterprise reorganisations.

Demand

Growth in service exports raised total exports

The value of exports, EUR 96 billion, grew by 7.2 per cent in 2019. Prices of export products went down by 0.3 per cent and the volume of exports increased by 7.5 per cent. Total exports were pushed up by the 15.8 per cent growth in the volume of service exports.

The value of exports of goods rose by 3.0 per cent and the volume of exports grew by 3.9 per cent. Goods exports rose due to orders of ships delivered abroad in 2019. For other demand items the delivery of ships abroad was visible as a reduction in inventories.

Level of other building construction investments was raised for 2017 to 2019

The current priced value of investments grew by two per cent to EUR 57.5 billion in 2019. The volume of investments fell by one per cent. The volume of other building construction investments grew by four per cent. Investments in residential buildings, machinery and intellectual property products decreased from 2018.

The levels of investments were revised for the years 2016 to 2019. The largest changes concerned other building construction investments. The level of other building construction investments is raised in connection with the base year revision of the volume index of newbuilding.

Households’ savings ratio turned positive

Households’ adjusted disposable income grew in real terms, that is, adjusted for price changes by 1.6 per cent in 2019. Adjusted disposable income also includes social transfers in kind, which can be interpreted as welfare services offered to households. These services are the individual educational, health and social services that general government and organisations produce for households.

Households’ final consumption expenditure increased by 1.8 per cent and households’ savings amounted to good EUR 0.7 billion (EUR -0.4 billion in 2018). The savings ratio was 0.6 per cent.

Growth rate of the wages and salaries sum and employed persons slowed down in 2019

The growth rate of the wages and salaries sum of the whole economy and employed persons slowed down in 2019. In 2019, the wages and salaries sum of the whole economy grew by 3.2 per cent compared to the previous year (4.6 per cent in 2018). The number of employed persons, in turn, grew by 1.6 per cent (2.5 per cent in 2018). The number of hours worked grew slightly slower than the number of employed persons, by 1.2 per cent (2.3 per cent in 2018).

Local government deficit increased

The financial position, or net lending, of general government showed a deficit of EUR 2.3 billion. In the previous year, the deficit was EUR 2.0 billion. The deficit amounted to 1.0 per cent relative to GDP.

The deficit of central government was EUR 2.8 billion, while one year before it was EUR 2.9 billion. According to revised data, the deficit of local government (municipalities and joint municipal authorities, etc.) grew to EUR 2.8 billion. The growth in local government deficit was caused by an increase in government consumption expenditure and investments.

The surplus of employment pension schemes was EUR 2.7 billion, while one year before the corresponding figure was EUR 2.3 billion. The amount of pensions paid by employment pension schemes continued to grow but the collected employment pension contributions also increased. The surplus does not include holding gains in assets. Other social security funds showed a surplus of EUR 0.6 billion.

Source: National Accounts 2019, second preliminary data. Statistics Finland

Inquiries: Tapio Kuusisto 029 551 3318, Jarkko Kaunisto 029 551 3551, kansantalous@stat.fi

Director in charge: Jan Nokkala

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Appendix tables

• Appendix table 1. Gross domestic product (GDP) 1975-2019* (18.6.2020)
• Appendix table 2. Revision of annual volume change, % (18.6.2020)

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Updated 18.6.2020