Finland ended 2018 with a deficit of 1.6 billion

Finland's general government deficit was 0.7 per cent relative to gross domestic product (GDP) in 2018, according to the revised preliminary data reported by Statistics Finland to the European Union's statistical office (Eurostat).

The deficit rate achieved by Finland last year is was clearly below the reference value of the EU Stability and Growth Pact, which is 3 per cent relative to GDP.

General government EDP debt, or consolidated gross debt, was 58.9 per cent relative to GDP, also below the EU reference value of 60 per cent.

Source: Statistics Finland.

In 2018, general government deficit, or net borrowing according to national accounts, was 1.6 billion euros. The financial position of general government improved by 0.3 billion euros from the previous year.

"Significant" growth in tax revenue

The central government's financial position improved most, by 1.3 billion euros compared with 2017, and it was particularly due to the significant growth in tax revenue, explains Statistics Finland. However, the central government remained clearly in deficit, its deficit being 2.7 billion euros in 2018.

The local government sector’s deficit, or net borrowing was 1.9 billion euros in 2018, which is 1.5 billion euros more than one year earlier.

Social security funds are divided into employment pension schemes and other social security funds. The sector’s surplus was 3.1 billion euros in 2018, or 0.4 billion euros more than in the previous year.

Compared to the preliminary data released in mid-March, the deficit of general government was revised to 207 million euros higher. Of general government subsectors, the biggest updates concerned employment pension schemes where surplus decreased compared to March by 115 million euros to 2,372 million euros.

Source: Statistics Finland.

Consolidated general government gross debt (EDP debt) amounted to 137.5 billion euros at the end of 2018. The debt grew by 0.3 billion euros in 2018. Central government debt decreased by 1.2 billion euros and local government debt grew by 0.9 billion euros.

The debt of social security funds decreased by 0.6 billion euros. The decrease in consolidated items between general government by 1.2 per cent contributed to the debt of the entire general government sector growing by said 0.3 billion euros in 2018.

The EDP debt describes general government’s debt to the other sectors of the economy and to the rest of the world, and its development is influenced by changes in both the unconsolidated gross debt and the internal general government debt.

Compared with the preliminary data published in March, the ratio of debt to GDP remained the same.

Eurostat will publish preliminary data on Members States on 23 April 2019.