Ireland will recover, says Finnish PM

THE ECONOMY will recover and, over time, it will be hard to remember the difficulties faced by the Republic today, the Finnish prime minister said yesterday.

Mari Kiviniemi, who was visiting Dublin for trade talks with Taoiseach Brian Cowen, said Finland recovered well from a comparable banking, economic and confidence collapse in the early 1990s.

“In Finland, we had quite the same feeling in 1990s but gradually the situation improved and after a couple of years it improved even more. And then after some time, it was difficult to remember the hard times,” Ms Kiviniemi said.

She noted that Finland’s banks traded through the most recent financial crisis without any need of State support, a fact Ms Kiviniemi attributes to their problems having been tackled two decades ago.

Finland adopted a range of targeted measures after its banking-led collapse in the 1990s, including the establishment of a “bad bank”, which is seen as the model for the National Asset Management Agency. Unemployment soared to 20 per cent and severe, lasting cuts were felt across Finnish society.

“I think Ireland has taken advantage of our experiences,” said Ms Kiviniemi, who took office earlier this year and was still a student when the Finnish crisis took hold.

She said it seemed “very obvious” that the Republic would manage its way through current difficulties. “I’m impressed by what the Government has done,” said Ms Kiviniemi, while acknowledging that the economic outlook remains uncertain.

“I can’t even tell you what will happen in Finland next year,” she said, noting that while her country’s banks are healthy, the rest of the export-led Finnish economy is susceptible to global difficulties.

She highlighted positive results drawn from Finnish policies on research and development, which see €7 billion being pumped into the area each year, through a mixture of public and private money. Nokia, Finland’s biggest company, flourished under the system, helping to create clusters of ICT investment in the country.