In the economic environment overshadowed by the COVID19 pandemic and the war in Ukraine, the Finnish government’s decision to invest in research and development (R&D) also brings confidence in the future among startup entrepreneurs. “This was also the case during the recession of the 1990s, when we were able to gather the results of the decisions through, among other things, the rise of Nokia,” says Riikka PakarinenCEO of the Finnish startup community.
In international comparison, however, Finland is still far from the top. In relation to GDP, Finland’s investment in research and development is only eleven among OECD countries. For example, levels in Denmark (3.1% / GDP) and Sweden (3.4%) are clearly higher than in Finland (2.8%). For example, South Korea is one of the leading countries in terms of R&D investment, accounting for almost 5% of GDP. – We must also be open-minded to more distant, more technologically advanced countries, Pakarinen says.
R&D funding for the regions
In the budget framework negotiations, the Government decided on additional support from the Academy of Finland, increased strategic research funding, as well as regional R&D funding and an R&D tax incentive for companies as completely new tools. “It is important that companies have incentives to increase product development,” says CEO Pakarinen. “The emergence of new businesses and innovations is vital to our country’s economy.” Exports from start-ups have grown rapidly and currently total EUR 3 billion a year. At the current growth rate, Finnish start-ups are the size of the Finnish forest industry – by 2030. “This will only happen if development is supported. The additional budget allocation for R&D is a step in the right direction, but future governments must continue on this path. Including the private sector, Finland’s R&D investment should be raised to 4% of GDP in the coming election periods, ”says Pakarinen. These decisions also make Finland more attractive in the eyes of foreign investments and experts.
Crises open up opportunities
Due to the green transition and supply chain disruptions, Finland is now preparing for e.g. rapid changes in the country’s energy supply. This opens up new opportunities not only for green energy production but also for other innovations in all industries. “There are already numerous growth and startup companies in Finland that are developing new solutions for energy production and the transition to green,” he recalls. Youssef Zad, economist in the Finnish startup community. “Supporting the research and development of these companies will help solve global challenges. In addition, it will create jobs and wealth.”
Source: The Finnish Startup Community
Source: The Nordic Page