According to the October Business Tendency Survey of the Confederation of Finnish Industries, Finnish companies remained in a very weak stage of the business cycle, although some positive signs were apparent.

Output was still at a low level and there were reductions in personnel in all sectors. Nevertheless, there was no further decline in the number of orders and stockpiles of finished goods had already dropped below the normal level.

Forecasts suggest that the Finnish economy will bottom out for the rest of this year and at the beginning of 2010. Although the market situation is in fact expected to stabilise gradually, there are no expectations of a rapid recovery and return to growth.

Outlooks vary somewhat between sectors. In the forest and chemical industry and in information and communication services the weak market situation is expected to improve somewhat. The technology industry is predicting a weak economy far into next year. In construction, the worst part of the recession seems to be over, although owing to seasonal factors the coming months will remain bleak.

The manufacturing industry business outlook balance indicator for October was -6. The corresponding indicator for July was -8. Hence the weak stage of the cycle is expected to continue into the first half of next year. In October a turn for the better was expected by 12% of the respondents while 18% believed that conditions would deteriorate further.

In October, the business outlook balance indicator for construction was -32 (-35 in July). Improvement in the coming months was forecast by 10% of the companies. A continued downturn was expected by 42% of the respondents.

The outlook for service companies in October was -5 (-23 in July). An improved outlook was now expected by 13% of the responding companies and a further decline by 18%.

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Electricity consumption will grow again after the recession

The consumption of electricity in Finland will continue to grow, albeit somewhat slower than has been previously forecast. According to the latest estimate by EK, the demand for electricity will increase by the year 2030 by approximately 20 percent from the situation preceding the recession and around one third from current consumption.

Electricity consumption will increase fastest in the service sectors and transportation. Demand for electricity will also grow within industry despite structural changes.

The latest information is included in a report that has just been completed by Finnish Energy Industries together with the Confederation of Finnish Industries EK. The report forecasts the demand for electricity in Finland in 2030.

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