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Finland-The Winter War WORLD WAR II, 1939-45

Finland Index

[JPEG]

Finnish machine gunners during the Winter War (1939-40)
Courtesy Embassy of Finland, Washington

Figure 7. Finland, Adjustments to the Frontier, 1940-1944

Source: Based on information from Anthony F. Upton, Finland in Crisis, 1940-41: A Study in Small-Power Politics, London, 1964, 22; and D. G. Kirby, Finland in the Twentieth Century, Minneapolis, 1979, x.

The underlying cause of the Winter War was Soviet concern about Nazi Germany's expansionism. With a population of only 3.5 million, Finland itself was not a threat to the Soviet Union, but its territory, located strategically near Leningrad, could be used as a base by the Germans. The Soviets initiated negotiations with Finland that ran intermittently from the spring of 1938 to the summer of 1939, but nothing was achieved. Finnish assurances that the country would never allow German violations of its neutrality were not accepted by the Soviets, who asked for more concrete guarantees. In particular, the Soviets sought a base on the northern shore of the Gulf of Finland, from which they could block the Gulf of Finland from hostile naval forces. The Finnish government, however, felt that accepting these terms would only lead to further, increasingly unreasonable, demands.

The Nazi-Soviet Non-Aggression Pact of August 1939, by bringing together these former archenemies, revolutionized European politics. The secret protocol of the pact gave the Soviet Union a sphere of influence that included Finland, the Baltic states, and parts of Eastern Europe. When the Germans won a stunningly quick victory over Poland in September 1939, the Soviets hastened to take control in their sphere of influence. In addition to the land taken from Poland in September, the Soviets quickly turned the three Baltic states into quasi-protectorates. Finland followed these events closely; thus, when, on October 5, the Soviets invited Finland to discuss "concrete political questions," the Finns felt that they were next on the Soviets' agenda. Finland's first reaction was to mobilize its field army on October 6, and on October 10 Finland's reservists were called up in what amounted to a general mobilization. The following day the two countries began negotiations that were to last until November 8.

In the negotiations, the main Soviet demand was that the Finns cede small parcels of territory, including a naval base on the Gulf of Finland that the Soviets wanted to help them protect Leningrad. In exchange, the Soviets offered to cede to Finland about 8,800 square kilometers of Karelia along the Finnish border, or about twice the amount of land to be ceded by Finland. Unlike the previous negotiations, these talks were conducted in the public eye, and the Finnish people, like the government, were almost unanimous in rejecting the Soviet proposals. The ostensible reasons for Finland's refusal were to protect its neutral status and to preserve its territorial integrity. In addition, moving the Finnish border on the Karelian Isthmus away from Leningrad would have given the Soviets possession of much of the line of Finnish fortifications, the loss of which would have weakened Finland's defenses. Underlying the hardline Finnish negotiating position were a basic mistrust of the Soviets and a feeling that the Soviet offer was merely a first step in subjugating Finland. In this suspicion of an ulterior motive, the Finns were matched by the Soviets, who believed that Finland would willingly assist Germany in a future war.

The Finnish government appears to have underestimated the Soviet determination to achieve these national security goals. The two main Finnish negotiators, Vainö Tanner and Juho Paasikivi, vainly urged the Finnish government to make more concessions, because they realized that Finland was completely isolated diplomatically and could expect no support from any quarter if events led to war. General Mannerheim also urged conciliating the Soviets, because Finland by itself could not fight the Soviet Union. When he was ignored, he resigned from the Defense Council and as commander-in-chief, saying that he could no longer be responsible for events. Mannerheim withdrew his resignation when war broke out, however, and served ably as the Finnish military leader. Some historians suggest that the war could have been prevented by timely Finnish concessions. It appears that both sides proceeded from a basic mistrust of the other that was compounded by mutual miscalculations and by the willingness to risk war.

The Soviets attacked on November 30, 1939, without a declaration of war. The Soviet preparations for the offensive were not especially thorough, in part because they underestimated the Finnish capabilities for resistance, and in part because they believed that the Finnish workers would welcome the Soviets as liberators. However, almost no Finns supported the Soviet puppet government under the veteran communist Otto Kuusinen. In addition, in one of its last significant acts, the League of Nations expelled the Soviet Union because of its unprovoked aggression against Finland.

The task facing the Finnish armed forces, to obstruct a vastly larger enemy along a boundary of about 1,300 kilometers, appeared impossible. Geography aided the Finns, however, because much of the northern area was a virtually impassable wilderness containing a few, easily-blocked roads, and Finland generally presented difficult terrain on which to conduct offensive operations. Thus the Finns were able to use only light covering forces in the north and to concentrate most troops in the crucial southeastern sector, comprising the Karelian Isthmus and the area north of Lake Ladoga, that protected the isthmus from rear assault. The position on the isthmus was strengthened considerably by the Mannerheim Line. An additional Finnish advantage lay in the Finns' unorthodox military doctrine. They were trained in the use of small, mobile forces to strike at the flanks and the rear of road-bound enemies. By means of the so- call motti tactic (the name is taken from the Finnish word for a cord of firewood), they sought to break invading columns into small segments, which were then destroyed piecemeal. The final advantage of the Finns was their phenomenally high morale; they knew they were fighting for their national survival. Finland's main disadvantage lay in the glaring, fifty-to-one disparity between its population and that of the Soviet Union. The Finnish hope was to hold out until help could arrive from the West, a forlorn hope as events turned out.

Most observers expected an easy Soviet victory. The Soviets simply advanced all along the front with overwhelming forces, apparently intending to occupy all of Finland. Thanks to the foresight the Soviets had shown in previous years by constructing bases and railroads near the Finnish border, they were able to commit much larger forces than the Finns had anticipated. The main Soviet assault on the Mannerheim Line was stopped, though, in December 1939. Farther north along the line, the Finns were able to employ their motti tactics with surprising effectiveness. At the most famous of these engagements, the Battle of Suomussalmi, two Soviet divisions were virtually annihilated. By the end of December 1939, the Finns had dealt the Soviets a series of humiliating defeats. For a few weeks, the popular imagination of the outside world was captured by the exploits of the white-clad Finnish ski troops gliding ghostlike through the dark winter forests, and in general by the brave resistance of the "land of heroes."

The Soviet invasion brought the Finns together as never before. In an act that only a few years before would have been unthinkable, on Christmas Eve in December 1939, middle-class Finns placed lighted candles on the graves of Finnish Red Guards who had died in the civil war. The magnificent courage displayed by Finnish soldiers of all political persuasions during the Winter War of 1939-40 led Mannerheim to declare afterwards that May 16 would no longer be celebrated, but that another day would be chosen to commemorate "those on both sides who gave their lives on behalf of their political convictions during the period of crisis in 1918."

The defeats and the humiliations suffered by the Soviet Union made it even more determined to win the struggle. The military command was reorganized, and it was placed under General S. K. Timoshenko. The Soviets made intensive preparations for a new offensive, assembling masses of tanks, artillery, and first-class troops. On February 1, 1940, the Soviet offensive began, and this time it was confined to the Karelian Isthmus. Soviet tactics were simple: powerful artillery bombardments were followed by repeated frontal assaults, using masses of tanks and infantry. The Finnish defenders were worn down by the continual attacks, the artillery and the aerial bombardments, the cold, and the lack of relief and of replacements. On February 11, 1940, the Soviets achieved a breakthrough in the Mannerheim Line that led to a series of Finnish retreats. By early March, the Finnish army was on the verge of total collapse. Finland was saved only by agreeing quickly to Soviet terms, which were encompassed in the Peace of Moscow, signed on March 13, 1940.

By the terms of the Peace of Moscow, Finland ceded substantial territories: land along the southeastern border approximately to the line drawn by the Peace of Uusikaupunki in 1721, including Finland's second-largest city, Viipuri; the islands in the Gulf of Finland that were the object of the negotiations in 1938-39; land in the Salla sector in northeastern Finland (near the Murmansk Railroad); Finland's share of the Rybachiy Peninsula in the Petsamo area; and the naval base at Hanko on the Gulf of Finland, which was leased for thirty years. The ceded territories contained about one-eighth of Finland's population; virtually all of the inhabitants moved over to Finnish territory, thereby losing their homes and livelihoods (see fig. 7).

Finland's losses in the war were about 25,000 dead, 10,000 permanently disabled, and another 35,000 wounded, out of a population of only 3.5 million. Estimates of Soviet losses vary greatly. A subsequent Soviet leader, Nikita Khrushchev, estimated in his memoirs that the Soviet losses were about one million men. In addition, the Soviets lost much of their military credibility. Foreigners had observed keenly the performance of the Red Army in Finland, with the result that the military capabilities of the Soviet Union were widely discounted. Four months after the conclusion of the Winter War, Adolf Hitler decided to invade the Soviet Union, an event that historians generally consider a turning point of World War II.

It is true that the Red Army had performed badly in Finland, but there had been some extenuating circumstances. The winter of 1939 to 1940 was one of the coldest winters of the century, and the Soviet troops were not trained for action under Arctic conditions. The Soviet officer corps had been decimated by the purges of the 1930s, and the officers were intimidated by the presence of political commissars within their units. There was, especially in the first phase of the fighting, poor coordination of the various arms (infantry, artillery, armor, aircraft), and there were deficiencies in preparation and in intelligence. In the year following the Winter War, the Soviets worked hard at correcting their weaknesses, with the result that in 1941 the Red Army was a much more effective military machine.

Data as of December 1988

For most of Finland's history, the country had lived on the periphery of world events, but for a few weeks during the winter of 1939-40, Finland stood at the center of the world stage. Finland's stand against Soviet aggression aroused the world's admiration. The Winter War, however, proved to be only a curtain- raiser for Finland's growing entanglement in World War II.

The Winter War

[JPEG]

Finnish machine gunners during the Winter War (1939-40)
Courtesy Embassy of Finland, Washington

Figure 7. Finland, Adjustments to the Frontier, 1940-1944

Source: Based on information from Anthony F. Upton, Finland in Crisis, 1940-41: A Study in Small-Power Politics, London, 1964, 22; and D. G. Kirby, Finland in the Twentieth Century, Minneapolis, 1979, x.

The underlying cause of the Winter War was Soviet concern about Nazi Germany's expansionism. With a population of only 3.5 million, Finland itself was not a threat to the Soviet Union, but its territory, located strategically near Leningrad, could be used as a base by the Germans. The Soviets initiated negotiations with Finland that ran intermittently from the spring of 1938 to the summer of 1939, but nothing was achieved. Finnish assurances that the country would never allow German violations of its neutrality were not accepted by the Soviets, who asked for more concrete guarantees. In particular, the Soviets sought a base on the northern shore of the Gulf of Finland, from which they could block the Gulf of Finland from hostile naval forces. The Finnish government, however, felt that accepting these terms would only lead to further, increasingly unreasonable, demands.

The Nazi-Soviet Non-Aggression Pact of August 1939, by bringing together these former archenemies, revolutionized European politics. The secret protocol of the pact gave the Soviet Union a sphere of influence that included Finland, the Baltic states, and parts of Eastern Europe. When the Germans won a stunningly quick victory over Poland in September 1939, the Soviets hastened to take control in their sphere of influence. In addition to the land taken from Poland in September, the Soviets quickly turned the three Baltic states into quasi-protectorates. Finland followed these events closely; thus, when, on October 5, the Soviets invited Finland to discuss "concrete political questions," the Finns felt that they were next on the Soviets' agenda. Finland's first reaction was to mobilize its field army on October 6, and on October 10 Finland's reservists were called up in what amounted to a general mobilization. The following day the two countries began negotiations that were to last until November 8.

In the negotiations, the main Soviet demand was that the Finns cede small parcels of territory, including a naval base on the Gulf of Finland that the Soviets wanted to help them protect Leningrad. In exchange, the Soviets offered to cede to Finland about 8,800 square kilometers of Karelia along the Finnish border, or about twice the amount of land to be ceded by Finland. Unlike the previous negotiations, these talks were conducted in the public eye, and the Finnish people, like the government, were almost unanimous in rejecting the Soviet proposals. The ostensible reasons for Finland's refusal were to protect its neutral status and to preserve its territorial integrity. In addition, moving the Finnish border on the Karelian Isthmus away from Leningrad would have given the Soviets possession of much of the line of Finnish fortifications, the loss of which would have weakened Finland's defenses. Underlying the hardline Finnish negotiating position were a basic mistrust of the Soviets and a feeling that the Soviet offer was merely a first step in subjugating Finland. In this suspicion of an ulterior motive, the Finns were matched by the Soviets, who believed that Finland would willingly assist Germany in a future war.

The Finnish government appears to have underestimated the Soviet determination to achieve these national security goals. The two main Finnish negotiators, Vainö Tanner and Juho Paasikivi, vainly urged the Finnish government to make more concessions, because they realized that Finland was completely isolated diplomatically and could expect no support from any quarter if events led to war. General Mannerheim also urged conciliating the Soviets, because Finland by itself could not fight the Soviet Union. When he was ignored, he resigned from the Defense Council and as commander-in-chief, saying that he could no longer be responsible for events. Mannerheim withdrew his resignation when war broke out, however, and served ably as the Finnish military leader. Some historians suggest that the war could have been prevented by timely Finnish concessions. It appears that both sides proceeded from a basic mistrust of the other that was compounded by mutual miscalculations and by the willingness to risk war.

The Soviets attacked on November 30, 1939, without a declaration of war. The Soviet preparations for the offensive were not especially thorough, in part because they underestimated the Finnish capabilities for resistance, and in part because they believed that the Finnish workers would welcome the Soviets as liberators. However, almost no Finns supported the Soviet puppet government under the veteran communist Otto Kuusinen. In addition, in one of its last significant acts, the League of Nations expelled the Soviet Union because of its unprovoked aggression against Finland.

The task facing the Finnish armed forces, to obstruct a vastly larger enemy along a boundary of about 1,300 kilometers, appeared impossible. Geography aided the Finns, however, because much of the northern area was a virtually impassable wilderness containing a few, easily-blocked roads, and Finland generally presented difficult terrain on which to conduct offensive operations. Thus the Finns were able to use only light covering forces in the north and to concentrate most troops in the crucial southeastern sector, comprising the Karelian Isthmus and the area north of Lake Ladoga, that protected the isthmus from rear assault. The position on the isthmus was strengthened considerably by the Mannerheim Line. An additional Finnish advantage lay in the Finns' unorthodox military doctrine. They were trained in the use of small, mobile forces to strike at the flanks and the rear of road-bound enemies. By means of the so- call motti tactic (the name is taken from the Finnish word for a cord of firewood), they sought to break invading columns into small segments, which were then destroyed piecemeal. The final advantage of the Finns was their phenomenally high morale; they knew they were fighting for their national survival. Finland's main disadvantage lay in the glaring, fifty-to-one disparity between its population and that of the Soviet Union. The Finnish hope was to hold out until help could arrive from the West, a forlorn hope as events turned out.

Most observers expected an easy Soviet victory. The Soviets simply advanced all along the front with overwhelming forces, apparently intending to occupy all of Finland. Thanks to the foresight the Soviets had shown in previous years by constructing bases and railroads near the Finnish border, they were able to commit much larger forces than the Finns had anticipated. The main Soviet assault on the Mannerheim Line was stopped, though, in December 1939. Farther north along the line, the Finns were able to employ their motti tactics with surprising effectiveness. At the most famous of these engagements, the Battle of Suomussalmi, two Soviet divisions were virtually annihilated. By the end of December 1939, the Finns had dealt the Soviets a series of humiliating defeats. For a few weeks, the popular imagination of the outside world was captured by the exploits of the white-clad Finnish ski troops gliding ghostlike through the dark winter forests, and in general by the brave resistance of the "land of heroes."

The Soviet invasion brought the Finns together as never before. In an act that only a few years before would have been unthinkable, on Christmas Eve in December 1939, middle-class Finns placed lighted candles on the graves of Finnish Red Guards who had died in the civil war. The magnificent courage displayed by Finnish soldiers of all political persuasions during the Winter War of 1939-40 led Mannerheim to declare afterwards that May 16 would no longer be celebrated, but that another day would be chosen to commemorate "those on both sides who gave their lives on behalf of their political convictions during the period of crisis in 1918."

The defeats and the humiliations suffered by the Soviet Union made it even more determined to win the struggle. The military command was reorganized, and it was placed under General S. K. Timoshenko. The Soviets made intensive preparations for a new offensive, assembling masses of tanks, artillery, and first-class troops. On February 1, 1940, the Soviet offensive began, and this time it was confined to the Karelian Isthmus. Soviet tactics were simple: powerful artillery bombardments were followed by repeated frontal assaults, using masses of tanks and infantry. The Finnish defenders were worn down by the continual attacks, the artillery and the aerial bombardments, the cold, and the lack of relief and of replacements. On February 11, 1940, the Soviets achieved a breakthrough in the Mannerheim Line that led to a series of Finnish retreats. By early March, the Finnish army was on the verge of total collapse. Finland was saved only by agreeing quickly to Soviet terms, which were encompassed in the Peace of Moscow, signed on March 13, 1940.

By the terms of the Peace of Moscow, Finland ceded substantial territories: land along the southeastern border approximately to the line drawn by the Peace of Uusikaupunki in 1721, including Finland's second-largest city, Viipuri; the islands in the Gulf of Finland that were the object of the negotiations in 1938-39; land in the Salla sector in northeastern Finland (near the Murmansk Railroad); Finland's share of the Rybachiy Peninsula in the Petsamo area; and the naval base at Hanko on the Gulf of Finland, which was leased for thirty years. The ceded territories contained about one-eighth of Finland's population; virtually all of the inhabitants moved over to Finnish territory, thereby losing their homes and livelihoods (see fig. 7).

Finland's losses in the war were about 25,000 dead, 10,000 permanently disabled, and another 35,000 wounded, out of a population of only 3.5 million. Estimates of Soviet losses vary greatly. A subsequent Soviet leader, Nikita Khrushchev, estimated in his memoirs that the Soviet losses were about one million men. In addition, the Soviets lost much of their military credibility. Foreigners had observed keenly the performance of the Red Army in Finland, with the result that the military capabilities of the Soviet Union were widely discounted. Four months after the conclusion of the Winter War, Adolf Hitler decided to invade the Soviet Union, an event that historians generally consider a turning point of World War II.

It is true that the Red Army had performed badly in Finland, but there had been some extenuating circumstances. The winter of 1939 to 1940 was one of the coldest winters of the century, and the Soviet troops were not trained for action under Arctic conditions. The Soviet officer corps had been decimated by the purges of the 1930s, and the officers were intimidated by the presence of political commissars within their units. There was, especially in the first phase of the fighting, poor coordination of the various arms (infantry, artillery, armor, aircraft), and there were deficiencies in preparation and in intelligence. In the year following the Winter War, the Soviets worked hard at correcting their weaknesses, with the result that in 1941 the Red Army was a much more effective military machine.

Data as of December 1988



BackgroundFinland was a province and then a grand duchy under Sweden from the 12th to the 19th centuries, and an autonomous grand duchy of Russia after 1809. It won its complete independence in 1917. During World War II, it was able to successfully defend its freedom and resist invasions by the Soviet Union - albeit with some loss of territory. In the subsequent half century, the Finns made a remarkable transformation from a farm/forest economy to a diversified modern industrial economy; per capita income is now among the highest in Western Europe. A member of the European Union since 1995, Finland was the only Nordic state to join the euro system at its initiation in January 1999.
LocationNorthern Europe, bordering the Baltic Sea, Gulf of Bothnia, and Gulf of Finland, between Sweden and Russia
Area(sq km)total: 338,145 sq km
land: 303,815 sq km
water: 34,330 sq km
Geographic coordinates64 00 N, 26 00 E
Land boundaries(km)total: 2,654 km
border countries: Norway 727 km, Sweden 614 km, Russia 1,313 km

Coastline(km)1,250 km

Climatecold temperate; potentially subarctic but comparatively mild because of moderating influence of the North Atlantic Current, Baltic Sea, and more than 60,000 lakes

Elevation extremes(m)lowest point: Baltic Sea 0 m
highest point: Haltiatunturi 1,328 m
Natural resourcestimber, iron ore, copper, lead, zinc, chromite, nickel, gold, silver, limestone
Land use(%)arable land: 6.54%
permanent crops: 0.02%
other: 93.44% (2005)

Irrigated land(sq km)640 sq km (2003)
Total renewable water resources(cu km)110 cu km (2005)
Freshwater withdrawal (domestic/industrial/agricultural)total: 2.33 cu km/yr (14%/84%/3%)
per capita: 444 cu m/yr (1999)
Natural hazardsNA
Environment - current issuesair pollution from manufacturing and power plants contributing to acid rain; water pollution from industrial wastes, agricultural chemicals; habitat loss threatens wildlife populations
Environment - international agreementsparty to: Air Pollution, Air Pollution-Nitrogen Oxides, Air Pollution-Persistent Organic Pollutants, Air Pollution-Sulfur 85, Air Pollution-Sulfur 94, Air Pollution-Volatile Organic Compounds, Antarctic-Environmental Protocol, Antarctic-Marine Living Resources, Antarctic Treaty, Biodiversity, Climate Change, Climate Change-Kyoto Protocol, Desertification, Endangered Species, Environmental Modification, Hazardous Wastes, Law of the Sea, Marine Dumping, Marine Life Conservation, Ozone Layer Protection, Ship Pollution, Tropical Timber 83, Tropical Timber 94, Wetlands, Whaling
signed, but not ratified: none of the selected agreements
Geography - notelong boundary with Russia; Helsinki is northernmost national capital on European continent; population concentrated on small southwestern coastal plain
Population5,250,275 (July 2009 est.)
Age structure(%)0-14 years: 16.4% (male 438,425/female 422,777)
15-64 years: 66.8% (male 1,773,495/female 1,732,792)
65 years and over: 16.8% (male 357,811/female 524,975) (2009 est.)
Median age(years)total: 42.1 years
male: 40.5 years
female: 43.7 years (2009 est.)
Population growth rate(%)0.098% (2009 est.)
Birth rate(births/1,000 population)10.38 births/1,000 population (2009 est.)
Death rate(deaths/1,000 population)10.07 deaths/1,000 population (July 2009 est.)

Net migration rate(migrant(s)/1,000 population)0.68 migrant(s)/1,000 population (2009 est.)
Urbanization(%)urban population: 63% of total population (2008)
rate of urbanization: 0.8% annual rate of change (2005-10 est.)
Sex ratio(male(s)/female)at birth: 1.04 male(s)/female
under 15 years: 1.04 male(s)/female
15-64 years: 1.02 male(s)/female
65 years and over: 0.68 male(s)/female
total population: 0.96 male(s)/female (2009 est.)
Infant mortality rate(deaths/1,000 live births)total: 3.47 deaths/1,000 live births
male: 3.78 deaths/1,000 live births
female: 3.15 deaths/1,000 live births (2009 est.)

Life expectancy at birth(years)total population: 78.97 years
male: 75.48 years
female: 82.61 years (2009 est.)

Total fertility rate(children born/woman)1.73 children born/woman (2009 est.)
Nationalitynoun: Finn(s)
adjective: Finnish
Ethnic groups(%)Finn 93.4%, Swede 5.6%, Russian 0.5%, Estonian 0.3%, Roma (Gypsy) 0.1%, Sami 0.1% (2006)

Religions(%)Lutheran Church of Finland 82.5%, Orthodox Church 1.1%, other Christian 1.1%, other 0.1%, none 15.1% (2006)
Languages(%)Finnish 91.2% (official), Swedish 5.5% (official), other 3.3% (small Sami- and Russian-speaking minorities) (2007)

Country nameconventional long form: Republic of Finland
conventional short form: Finland
local long form: Suomen tasavalta/Republiken Finland
local short form: Suomi/Finland
Government typerepublic
Capitalname: Helsinki
geographic coordinates: 60 10 N, 24 56 E
time difference: UTC+2 (7 hours ahead of Washington, DC during Standard Time)
daylight saving time: +1hr, begins last Sunday in March; ends last Sunday in October
Administrative divisions6 provinces (laanit, singular - laani); Ahvenanmaan Laani (Aland), Etela-Suomen Laani (Southern Finland), Ita-Suomen Laani (Eastern Finland), Lansi-Suomen Laani (Western Finland), Lapin Laani (Lapland), Oulun Laani
Constitution1-Mar-00

Legal systemcivil law system based on Swedish law; the president may request the Supreme Court to review laws; accepts compulsory ICJ jurisdiction with reservations

Suffrage18 years of age; universal
Executive branchchief of state: President Tarja HALONEN (since 1 March 2000)
head of government: Prime Minister Matti VANHANEN (since 24 June 2003); Deputy Prime Minister Jyrki KATAINEN (since 19 April 2007)
cabinet: Council of State or Valtioneuvosto appointed by the president, responsible to parliament
elections: president elected by popular vote for a six-year term (eligible for a second term); election last held 15 January 2006 (next to be held in January 2012); the president appoints the prime minister and deputy prime minister from the majority party or the majority coalition after parliamentary elections and the parliament must approve the appointment; Prime Minister VANHANEN reelected 17 April 2007
election results: percent of vote - Tarja HALONEN (SDP) 46.3%, Sauli NIINISTO (Kok) 24.1%, Matti VANHANEN (Kesk) 18.6%, Heidi HAUTALA (VIHR) 3.5%; a runoff election between HALONEN and NIINISTO was held 29 January 2006 - HALONEN 51.8%, NIINISTO 48.2%; Matti VANHANEN reelected prime minister; election results 121-71
note: government coalition - Kesk, KOK, VIHR, and SFP
Legislative branchunicameral Parliament or Eduskunta (200 seats; members are elected by popular vote on a proportional basis to serve four-year terms)
elections: last held 18 March 2007 (next to be held March 2011)
election results: percent of vote by party - Kesk 23.1%, Kok 22.3%, SDP 21.4%, VAS 8.8%, VIHR 8.5%, KD 4.9%, SFP 4.5%, True Finns 4.1%, other 3.4%; seats by party - Kesk 51, Kok 50, SDP 45, VAS 17, VIHR 15, SFP 9, KD 7, True Finns 5, other 1

Judicial branchSupreme Court or Korkein Oikeus (judges appointed by the president)

International organization participationADB (nonregional member), AfDB (nonregional member), Arctic Council, Australia Group, BIS, CBSS, CE, CERN, EAPC, EBRD, EIB, EMU, ESA, EU, FAO, G-9, IADB, IAEA, IBRD, ICAO, ICC, ICCt, ICRM, IDA, IEA, IFAD, IFC, IFRCS, IHO, ILO, IMF, IMO, IMSO, Interpol, IOC, IOM, IPU, ISO, ITSO, ITU, ITUC, MIGA, MINURCAT, NC, NEA, NIB, NSG, OAS (observer), OECD, OPCW, OSCE, Paris Club, PCA, PFP, Schengen Convention, UN, UNCTAD, UNESCO, UNHCR, UNIDO, UNMIL, UNMIS, UNMOGIP, UNTSO, UPU, WCO, WEU (observer), WFTU, WHO, WIPO, WMO, WTO, ZC
Flag descriptionwhite with a blue cross extending to the edges of the flag; the vertical part of the cross is shifted to the hoist side in the style of the Dannebrog (Danish flag); the blue represents the thousands of lakes scattered across the country, while the white is for the snow that covers the land in winter

Economy - overviewFinland has a highly industrialized, largely free-market economy with per capita output roughly that of the UK, France, Germany, and Italy. Its key economic sector is manufacturing - principally the wood, metals, engineering, telecommunications, and electronics industries. Trade is important; Finland's ratio of exports to GDP has risen from a quarter to 37% over the past 15 years. Finland excels in high-tech exports such as mobile phones. Except for timber and several minerals, Finland depends on imports of raw materials, energy, and some components for manufactured goods. Because of the climate, agricultural development is limited to maintaining self-sufficiency in basic products. Forestry, an important export earner, provides a secondary occupation for the rural population. Although Finland has been one of the best performing economies within the EU in recent years and its banks and financial markets have avoided the worst of global financial crisis, the world slowdown has hit export growth and domestic demand and will serve as a brake on economic growth in 2009 and 2010. The slowdown of construction, other investment, and exports will cause unemployment to rise. During 2009, unemployment will climb to over 8% of the labor force. Long-term challenges include the need to address a rapidly aging population and decreasing productivity that threaten competitiveness, fiscal sustainability, and economic growth.
GDP (purchasing power parity)$194 billion (2008 est.)
$192.4 billion (2007 est.)
$184.8 billion (2006 est.)
note: data are in 2008 US dollars
GDP (official exchange rate)$271.9 billion (2008 est.)
GDP - real growth rate(%)0.8% (2008 est.)
4.1% (2007 est.)
4.9% (2006 est.)
GDP - per capita (PPP)$37,000 (2008 est.)
$36,700 (2007 est.)
$35,300 (2006 est.)
note: data are in 2008 US dollars
GDP - composition by sector(%)agriculture: 2.8%
industry: 32.4%
services: 64.9% (2008 est.)
Labor force2.703 million (2008 est.)

Labor force - by occupation(%)agriculture and forestry 4.5%, industry 18.3%, construction 7.3%, commerce 16%, finance, insurance, and business services 14.5%, transport and communications 7%, public services 32.4% (2008)
Unemployment rate(%)6.4% (2008 est.)
6.9% (2007 est.)
Population below poverty line(%)NA%
Household income or consumption by percentage share(%)lowest 10%: 3.6%
highest 10%: 24.7% (2007)
Distribution of family income - Gini index29.5 (2007)
25.6 (1991)
Investment (gross fixed)(% of GDP)20.6% of GDP (2008 est.)
Budgetrevenues: $143.8 billion
expenditures: $132.3 billion (2008 est.)
Inflation rate (consumer prices)(%)4.1% (2008 est.)
2.5% (2007 est.)

Stock of money$NA (31December 2008)
$NA (31 December 2007)
note: see entry for the European Union for money supply in the euro area; the European Central Bank (ECB) controls monetary policy for the 16 members of the Economic and Monetary Union (EMU); individual members of the EMU do not control the quantity of money and quasi money circulating within their own borders
Stock of quasi money$NA (31 December 2008)
$NA (31 December 2007)
Stock of domestic credit$241.1 billion (31 December 2008)
$225.4 billion (31 December 2007)
Market value of publicly traded shares$NA (31 December 2008)
$369.2 billion (31 December 2007)
$265.5 billion (31 December 2006)
Public debt(% of GDP)33.7% of GDP (2008 est.)
46.8% of GDP (2004 est.)
Agriculture - productsbarley, wheat, sugar beets, potatoes; dairy cattle; fish
Industriesmetals and metal products, electronics, machinery and scientific instruments, shipbuilding, pulp and paper, foodstuffs, chemicals, textiles, clothing

Industrial production growth rate(%)0.4% (2008 est.)

Current account balance$5.518 billion (2008 est.)
$10.12 billion (2007 est.)
Exports$96.62 billion (2008 est.)
$90.2 billion (2007 est.)

Exports - commodities(%)electrical and optical equipment, machinery, transport equipment, paper and pulp, chemicals, basic metals; timber
Exports - partners(%)Russia 11.6%, Sweden 10%, Germany 10%, US 6.4%, UK 5.5%, Netherlands 5.1% (2008)
Imports$87.51 billion (2008 est.)
$78.22 billion (2007 est.)

Imports - commodities(%)foodstuffs, petroleum and petroleum products, chemicals, transport equipment, iron and steel, machinery, textile yarn and fabrics, grains
Imports - partners(%)Russia 16.3%, Germany 15.7%, Sweden 13.6%, Netherlands 6.3%, China 5.1%, UK 4.2% (2008)

Reserves of foreign exchange and gold$8.346 billion (31 December 2008 est.)
$8.385 billion (31 December 2007 est.)
Debt - external$339.5 billion (31 December 2008)
$314.1 billion (31 December 2007)

Stock of direct foreign investment - at home$84.44 billion (31 December 2008 est.)
$88.69 billion (31 December 2007 est.)
Stock of direct foreign investment - abroad$116 billion (31 December 2008 est.)
$114.2 billion (31 December 2007 est.)
Exchange rateseuros (EUR) per US dollar - 0.6827 (2008 est.), 0.7345 (2007), 0.7964 (2006), 0.8041 (2005), 0.8054 (2004)

Currency (code)euro (EUR)

Telephones - main lines in use1.65 million (2008)
Telephones - mobile cellular6.83 million (2008)
Telephone systemgeneral assessment: modern system with excellent service
domestic: digital fiber-optic fixed-line network and an extensive cellular network provide domestic needs
international: country code - 358; submarine cables provide links to Estonia and Sweden; satellite earth stations - access to Intelsat transmission service via a Swedish satellite earth station, 1 Inmarsat (Atlantic and Indian Ocean regions); note - Finland shares the Inmarsat earth station with the other Nordic countries (Denmark, Iceland, Norway, and Sweden)
Internet country code.fi; note - Aland Islands assigned .ax
Internet users4.383 million (2008)
Airports148 (2009)
Pipelines(km)gas 694 km (2008)
Roadways(km)total: 78,141 km
paved: 50,914 km (includes 700 km of expressways)
unpaved: 27,227 km (2009)

Ports and terminalsHamina, Helsinki, Kokkola, Kotka, Naantali, Pori, Raahe, Rauma, Turku
Military branchesFinnish Defense Forces (FDF): Army, Navy (includes Coastal Defense Forces), Air Force (Suomen Ilmavoimat) (2007)
Military service age and obligation(years of age)18 years of age for male voluntary and compulsory - and female voluntary - national military and nonmilitary service; service obligation 6-12 months; mandatory retirement at age 60 (2008)
Manpower available for military servicemales age 16-49: 1,169,910
females age 16-49: 1,121,187 (2008 est.)
Manpower fit for military servicemales age 16-49: 962,479
females age 16-49: 920,297 (2009 est.)
Manpower reaching militarily significant age annuallymale: 33,784
female: 32,621 (2009 est.)
Military expenditures(% of GDP)2% of GDP (2005 est.)
Disputes - internationalvarious groups in Finland advocate restoration of Karelia and other areas ceded to the Soviet Union, but the Finnish Government asserts no territorial demands

Electricity - production(kWh)77.24 billion kWh (2007 est.)
Electricity - production by source(%)fossil fuel: 39%
hydro: 18.7%
nuclear: 30.4%
other: 11.8% (2001)
Electricity - consumption(kWh)86.9 billion kWh (2008)
Electricity - exports(kWh)3.335 billion kWh (2008 est.)
Electricity - imports(kWh)16.11 billion kWh (2008 est.)
Oil - production(bbl/day)9,789 bbl/day (2008 est.)
Oil - consumption(bbl/day)215,600 bbl/day (2008 est.)
Oil - exports(bbl/day)133,000 bbl/day (2008 est.)
Oil - imports(bbl/day)347,400 bbl/day (2008 est.)
Economic aid - donorODA, $1.023 billion (2007)

Oil - proved reserves(bbl)0 bbl
Natural gas - production(cu m)0 cu m (2008 est.)
Natural gas - consumption(cu m)4.735 billion cu m (2008 est.)
Natural gas - exports(cu m)0 cu m (2008)
Natural gas - proved reserves(cu m)0 cu m (1 January 2009 est.)
HIV/AIDS - adult prevalence rate(%)less than 0.1% (2007 est.)
HIV/AIDS - people living with HIV/AIDS2,400 (2007 est.)
HIV/AIDS - deathsfewer than 100 (2003 est.)
Literacy(%)definition: age 15 and over can read and write
total population: 100%
male: 100%
female: 100% (2000 est.)

School life expectancy (primary to tertiary education)(years)total: 17 years
male: 17 years
female: 18 years (2006)
Education expenditures(% of GDP)6.4% of GDP (2005)



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