BOFIT Viikkokatsaus / BOFIT Weekly 2018/09

The value of goods exports rose by 15 % last year to 3.4 billion euros. Strongest growth was in the machinery & equipment category, with the value of exports rising by over 25 % y-o-y. Otherwise, export development varied. From core export product groups e.g. foodstuffs grew by 5 %, while exports of chemical products and metals contracted slightly. Russia's share of Finnish goods exports was still below 6 %.

Until last year, the value of goods exports to Russia declined four years in a row and hit bottom in 2016 with the value of exports less than half of the 2008 peak. At that time, however, nearly 40 % of exports consisted of re-exports, i.e. goods not made in Finland. For example, re-exports of passenger cars and mobile phones have nearly ceased. In recent years, re-exports have comprised about a quarter of Finland's exports to Russia, consisting mainly of pharmaceuticals and products in the machinery & equipment category.

Finland's services exports to Russia also revived last year, driven in part by services related to tourism. Overnight stays by Russian travellers in Finland increased by 16 % last year. In January-September, Finland's total service exports to Russia increased by 20 % y-o-y. Growth in goods and services exports should continue this year on recovering Russian demand, but the rate of growth is likely lower than last year.

The value of Finnish goods imports from Russia grew by a third last year to 8.2 billion euros. The rapid growth mainly reflects higher oil prices and one-time supplies of gas pipes. Russia accounted for 13 % of Finland's goods imports.

Finnish goods trade with Russia

Source: Finnish Customs.