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Finland's Investment in Science: A Strategy for Economic Flexibility

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BNN Correspondents
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Finland's Investment in Science: A Strategy for Economic Flexibility

Finland, a Nordic nation known for its icy landscapes and Northern Lights, has recently garnered global recognition for a more cerebral achievement: its substantial investment in science. This commitment has not only enhanced the quality of jobs and the flexibility of its economy, but also added value to its exports. Despite the ephemeral nature of electoral cycles, Finnish governments, irrespective of their political hues, have consistently prioritized science, a decision that has seen public and private research and development (R&D) spending swell to almost 3% of the country's GDP. This is nearly double the percentage in countries like Italy and Spain.

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The Underlying Strategy

The Minister of Science in the new conservative government led by Petteri Orpo, Sari Multala, explains the rationale behind this substantial investment. In her view, the primary objective is to bolster productivity. She believes that the knowledge derived from scientific research should be utilized by companies to innovate in tandem with universities. The minister acknowledges that Finland has had to confront significant economic growth challenges, particularly its rapidly aging population, second only to Italy in Europe. This demographic hurdle has necessitated swift action to invest in science and education to stimulate the economy and enhance productivity.

Learning from the Finnish Model

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Even though Italy and Spain share similar demographic circumstances with Finland, they have not responded with the same level of investment in R&D. Multala posits that the short-term benefits of science and education also serve as a signal to companies about the government's commitment, thus instilling them with the confidence to invest in R&D. The Finnish approach amalgamates humility and resilience in the face of adversity, traits encapsulated by the Finnish word 'susi'.

Nokia: A Testament to the Power of R&D

The success story of Nokia, the Finnish telecommunications powerhouse, serves as a shining example of the benefits of a robust R&D ecosystem. Nokia's dominance in the mobile phone industry significantly bolstered Finland's exports until the advent of smartphone technology from global giants Google and Apple. Although Nokia experienced setbacks with the rise of smartphones, it continues to operate in the telecommunications sector, focusing on network infrastructure and development. The Finnish government aims to reconstruct the R&D system to promote greater collaboration between enterprises and universities, with a target of achieving a combined R&D investment of 4% of GDP by 2030.

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