Finland’s depression is the final indictment of Europe’s monetary union

Finland is sliding deeper into economic depression, a prime exhibit of currency failure and an even more unsettling saga for theoretical defenders of the euro than the crucifixion of Greece.

A full six-and-a-half years into the current global expansion, Finland’s GDP is 6pc below its previous peak. It is suffering a deeper and more protracted slump than the post-Soviet crash of the early 1990s, or the Great Depression of the 1930s. Nobody can accuse Finland of being spendthrift, or undisciplined, or technologically backward, or corrupt, or captive of an entrenched oligarchy, the sort of accusations levelled against the Greco-Latins. The country’s public debt is 62pc of GDP, lower than in Germany. Finland has long been held up as the EMU poster child of austerity, grit, and super-flexibility, the one member of the periphery that supposedly did its homework before joining monetary union and could therefore roll with the punches.

Finland tops the EU in the World Economic Forum’s index of global competitiveness. It comes 1st in the entire world for primary schools, higher education and training, innovation, property rights, intellectual property protection, its legal framework and reliability, anti-monopoly policies, university R&D links, availability of latest technologies, as well as scientists and engineers. Its near-perfect profile demolishes the central claim of the German finance ministry – through its mouthpiece in Brussels – that countries get into bad trouble in EMU only if they drag their feet on reform and spend too much. The country has obviously been hit by a series of asymmetric shocks: the collapse of its hi-tech champion Nokia, the slump in forestry and commodity prices, and the recession in Russia.

The relevant point is that it cannot now defend itself. Finland is trapped by a fixed exchange rate and by the fiscal straightjacket of the Stability Pact, a lawyers’ construct that was never intended for such circumstances. The Pact is being enforced anyway because rules are rules and because leaders in the Teutonic bloc have an idee fixee that moral hazard will run rampant if any country in the EMU core sets a bad example.

Lees deze column van Ambrose Evans-Pritchard verder op The Telegraph

Finnen willen de markka terug

In navolging van Oostenrijk heeft Finland de benodigde handtekeningen weten te bemachtigen om een nationaal referendum te houden. In juli van dit jaar tekenden meer dan 260,000 Oostenrijkers (4,12%) voor de petitie die vraagt om een referendum om uit de EU te stappen. Dat referendum komt er, maar nu ook in Finland.

50000 handtekeningen werden verzameld, wat leidt tot een verplicht debat in het Finse parlement. De petitie werd georganiseerd door de Finse Europarlementariër Paavo Väyrynen, een veteraan binnen de Finse politiek. Hij was eerder presidentskandidaat van de Centrumpartij en heeft gediend als Fins vice-premier en minister van Buitenlandse Zaken.

De handtekeningen worden momenteel gecontroleerd door het Finse Population Register Center, dat het initiatief vervolgens zal doorsturen naar het Parlement. Väyrynen begon vier maanden geleden met het verzamelen van handtekeningen voor de petitie en had na twee maanden al 42.000 handtekeningen binnen. Op een populatie van slechts 5,5 miljoen mensen een aardige score.

Finland was een van de founding members van de Eurozone. De petitie verzoekt het Parlement om een nationaal referendum over de eurozone te organiseren om erachter te komen of het volk het eens is dat Finland tot de Eurozone moet blijven behoren. In 1998 besloten Finse parlementariërs om zich bij de Eurozone te voegen waarmee de markka – de Finse munt sinds 1860 – zou werd vervangen door de euro. Väyrynen betoogt op zijn website dat de Finse economie zwaar te lijden heeft gehad door beslissingen die gemaakt werden in Brussel:

“Member states in distress are being financially supported in a way that violates the EU Treaties. These support mechanisms are being strengthened, and put in place on a permanent basis. The euro area decision making system is being changed in a way that would essentially reduce the economic and state independence of Finland”

Bron: Beurs

Niet een Grexit, maar een Finnxit

A petition to hold a referendum on Finland’s exiting the Eurozone has been signed by more than 27,000 residents, as of Tuesday, after it went live for voting on July 16.

The author of the initiative is Paavo Vayrynen, former foreign minister of Finland, who is currently a member of the Centre Party, the largest parliamentary party in the country.

In his blog, the politician wrote that the Finns should follow the path of the Nordic nations, which did not give up their national currencies upon joining the European Union and thus have the freedom to pursue a more flexible fiscal policy.

According to Vayrynen, the issue of withdrawal from the monetary bloc is not yet on the government’s agenda, However, he recommends that it should be decided through a referendum proceeded by a public debate to weigh up all the pros and cons.

In order to submit the petition for the parliament’s consideration, the initiative must receive at least 50,000 signatures, collected within the term of six months.

The Nordic nations of Denmark and Sweden are EU members but do not use the euro.

Bron: Sputnik

Why it’s time for debt-addled Greece to worry about the Finns

Griekenland kan de borst nat maken op 11 mei. Dan komen de Ministers van de eurozone weer bijeen. De nieuwe minister van Financiën van Finland zal dan ook bekend zijn. Namen van kandidaten doen al de ronde. En die wijzen maar op één ding: het wordt een ijskoude wind uit het noorden.

Prospective finance minister of the Nordic nation will try and squeeze Greece to the edge of default, whoever gets the job.

The eurozone’s coterie of finance ministers is set to get a new face this week as Finland is set to formalise the details of its coalition government. Following elections last month, in which the liberal Centre Party emerged as the largest party, prime minister elect, Juha Sipila is poised to announce who has made it into his cabinet after three weeks of political horse-trading. As one of the single currency’s most ardent champions of austerity, the rest of the eurozone will be watching on with interest.

The candidates in line for the role of finance minister could help determine how far debt-stricken Greece will be pushed in its ill-tempered negotiations. The favourite for the job is Timo Soini, leader of eurosceptic True Finns who first stormed into the limelight at the height of the eurozone’s woes in 2011. Fiercely anti-immigration and a trenchant critic of creditor benevolence to southern countries, Mr Soini was left out of government over his resistance to Finnish involvement in the eurozone’s rescue programme for Portugal four years ago.

This time round, the True Finns – who have been rebranded as just The Finns – came in with nearly 18pc of the vote, and are likely to be brought into from the cold as the second largest party in parliament. Traditionally, the post of finance minister has gone to the leader of the junior coalition partner.

In Mr Soini, a 52-year-old Millwall supporter who counts Nigel Farage among his closest political allies, the euro’s finance chiefs may well find themselves sitting around the table with a maverick who would put Greece’s much-maligned Yanis Varoufakis in the shade.

Lees verder op The Telegraph