Lintilä: Food prices may double in Finland due to Russia’s war in Ukraine

“If people currently spend 11 percent of their or income on food, it will rise to more than 20 percent,” he predicted.

While a doubling of consumer prices is possible, it is not the most likely consequence of the Csaba Jansik, senior researcher at the Natural Resources Center (Luke). He recalled that are difficult to predict because they are made up of a large number of components.

“[Doubling] is the worst case scenario. We will not see such big increases if everything goes well and we get a regular harvest in Finland. ”

The Bank of Finland has published weaker economic forecast due to the protracted war, which predicts the economy to grow at a rate of 0.5–2.0 per cent in 2022. Inflation is expected to rise to 4–5 per cent in both scenarios, mainly due to rising and commodity prices.

Lintilä told that the government does not intend to financially support that withdraw from Russia in protest of the war . He recalled that Russia has been perceived by many companies as a risky and lucrative market, and sometimes the risks simply materialize.

The government and business advocacy groups provide advice to companies entering the market on what to do in an uncertain situation.

“According to publicly available information, Finnish companies have three options: they can either continue their business, sell their operations to Russian partners or go bankrupt,” he summed up.

Finnish companies leaving Russia are Fazer, Hesburger, Paulig and Valio.

Western countries have also announced their intention to get rid of their energy and raw material dependence on Russia.

Lintilä considered that the government should make a “depot stop” in its climate goals to ensure security of energy supply in Finland. He personally reconsidered the future increase in the distribution obligation for renewable fuels by fuel distributors as it would affect diesel and petrol prices. In the short term, peat is also needed for heat production to compensate for the decline in wood chips imported from Russia.

Security of supply alone, he said, justifies financial support for the logistics and transport sector amid high fuel prices.

“We have to keep the wheels turning,” he explained.

Lintilä has previously stated that he cannot anticipate a scenario in which a building permit will be granted for the project of , a minority-owned consortium of the Russian state-owned Rosatom. About two thirds of the project is owned by Finnish companies and municipalities.

The owners are likely to bear the costs of the doomed project, Lintilä replied.

Lintilä reminded the broadcaster earlier last week that the project consortium may carry out some construction on the basis of a decision in principle issued by the government.

– They are currently building the factory floor. They can build a floor, but whether they can have equipment on the floor depends on another permit. And I don’t think there are any conditions for it to get permission, he does comments At YLE A-studio on Tuesday 8.3.

Aleksi Teivainen – HT

Source: The Nordic Page

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