Finland backs centrist politician to revive economy

Juha Sipilä’s Centre Party wins 21% of vote and is likely to head new coalition government

As a self-made millionaire, Finland’s Juha Sipilä knows a thing or two about success in business. After leading his Centre Party to victory in Sunday’s general election, Mr Sipilä said yesterday he means business in unveiling a plan – and political partners – to revive the Nordic country’s stalled economy.

“I believe that the election results give us a clear mandate to start talks on government formation,” said Mr Sipilä, whose opposition Centre Party won 21 per cent of the vote and is likely to head a new coalition government. “There are several alternatives, so we are not dependent on only one (constellation). No alternative has been excluded.”

After four difficult years Finnish voters ejected the ruling right-left coalition headed by Alexander Stubb, though his liberal National Coalition party finished second with 18 per cent and could yet return to power. Their little-loved Social Democrat (SDP) partners took 16.5 per cent to finish fourth while, in third place, were the right-wing populist Finns party with 17.6 per cent, a slight drop on 2011.

That party and its eurosceptic leader, Timo Soini, were written off in the campaign but bounced back in the final days. As jostling for cabinet positions begins Mr Soini – who served as foreign affairs committee in the outgoing parliament – is keen on power and on the foreign or finance ministries.


Mr Stubb hopes for a key position, too, while Mr Sipilä is likely to reward returning EU commissioner and Centre Party ally Olli Rehn.

Mr Sipilä won the election on an economics platform, vowing to apply his business know-how to an economy that has shrunk three times in succession. He has promised 80,000 new jobs in the next four years and two per cent growth by cutting back on bureaucracy and boosting tax breaks for small business.

His choice of coalition partners will give the first indication of whether to expect a centre-left or centre-right direction.

Today’s initial talks are likely to focus on general policy outlines – in particular how much austerity and stimulus each party favours to plug a €6 billion hole in the budget.

The end of Nokia’s mobile phone business has left a massive gap in Finnish finances, as have long-term structural problems in the steel export and paper-pulp industries.

Mr Sipilä will hold talks with labour and industry leaders and plans to have a programme for government within a month.

No one is expecting dramatic change on EU or foreign policy matters: the new government will maintain Helsinki's hard line on Greece and bailouts, though Mr Soini's participation in government could see a ramping up of bailout-critical rhetoric.

Balancing act

The new Finnish government is likely to maintain a balancing act on


by remaining loyal to the EU line over


while going out of its way not to annoy its large partner to the east.

That said, Mr Sipilä has ruled out Nato membership for now, though showed a readiness to back a more pragmatic Nordic defence alliance. Whether such a co-operation with Denmark, Norway and Sweden will amount to anything much is another matter.

In talks all eyes will be on Mr Sipilä and Mr Soini. On election night they delivered strikingly heartfelt praise of each other, suggesting trust between the two men.

Unusually for Finland both are strictly religious men: Mr Sipilä is a member of a Lutheran revival movement known as Laestadianism. Mr Soini, meanwhile, is a staunch Catholic – one of just 9,000 in Finland – after what he calls an "amazing" encounter with a nun 30 years ago in St Mary's Cathedral, Killarney.

Derek Scally

Derek Scally

Derek Scally is an Irish Times journalist based in Berlin