Finland Times

 

Danske Bank chief economist Pasi Kuoppamäki. Photo – Lehtikuva.

Senior bank economists of the country have expressed optimism about the possibility of levelling the state debt by 2018.

 

The success will, however, depend on economic growth and the strength of the country’s exports.

 

The government during the mini-government negotiations agreed to respect the spending-limit decisions reached during the March budget framework talks together with the decision to level off the state debt in the period up to 2018.

 

Pasi Kuoppamäki, chief economist at Danske Bank believes the assumption is possible, if the predicted economic growth is achieved. The economist, however, pointed out that the decision to limit further indebtedness gives little room for manoeuvrability in the coming years with regard to economic policy.

 

OP-Pohjola Group chief economist Reijo Heiskanen. Photo – Lehtikuva.

Kuoppamäki also welcomed the 1.1 billion euro stimulus package taken by the government to create growth and jobs.

 

He believes the package will promote employment and improve purchasing power.

 

However, Kuoppamäki emphasised that economic growth will first and foremost depend on the country’s exports.

 

Reijo Heiskanen, chief economist of another bank, Osuuspankki, said a lot has to happen before 2018 for the state debt to level off. According to Heiskanen, it is clear that the next government will make its own decision and so it is difficult to comment on such far-reaching issues.

 

Heiskanen pointed out that going ahead with the structural reform programme is essential for economic recovery.

 

Nordea's chief economist, Aki Kangasharju. Photo – Lehtikuva.

Finland’s leading bank Nordea’s chief economist, Aki Kangasharju believes that everything depends on the country’s export strength and competitiveness.

 

Kangasharju regards the forecast realistic, if structural and labour market reform measures are completed.

 

On the stimulus package, Kangasharju hailed the idea of a small package which he regards suitable for 4-5 years. In his view, it is ideal that the stimulus package focuses on economic revival rather than long-term restructuring.

 

All the chief economists, however, concur that the tax relief would have minimum impact on the economy.