BOFIT Viikkokatsaus / BOFIT Weekly Review 2021/39

The value of goods and services exported from Finland to Russia rose by 11 % y-o-y in the first half of this year. In the second quarter, exports exceeded pre-pandemic levels, even after falling last year to historical lows. The recovery has been led by goods exports and particularly machinery & equipment exports have grown briskly supported by Russian investment demand. The favourable trend for goods exports continued also in July. In contrast, services exports have barely improved from the Covid Recession trough. Travel restrictions hit service exports particularly hard as both Finland and Russia imposed them to deal with the covid situation. In pre-pandemic years, tourism services accounted for about half of Finland’s services exports to Russia. Last year, the share fell to about a third. Russia accounted for 5 % of Finland’s total exports of goods and services in the first half of 2021.

The value of goods and services imported to Finland from Russia was up by 18 % y-o-y in in the first half of the year, but was still well below previous peak figures in 2019. The value of imports has been boosted largely by a strong rise in commodity prices, while the import volumes of many goods have recovered slowly. The world price of crude oil, Finland’s single most important import item from Russia, was in the first half of 2021 already close to the levels seen in the first half of 2019. The volume of Finland’s imports of crude oil from Russia, however, were down by nearly half in comparison in the first half of 2019. The drop apparently reflects reduced demand as Russia continues to account for nearly 90 % of Finland’s crude oil imports. Russia provided 8 % of Finland’s total imports of goods and services in the first half of this year.

Finnish goods exports to Russia have recovered well this year, while services exports have shown only slight improvement


Sources: Statistics Finland and BOFIT.

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