By Kati Pohjanpalo
Dec. 8 (Bloomberg) -- Finland’s economy grew at the slowest pace in three and a half years in the third quarter, less than forecast by economists, as exports declined and growth in consumer spending stalled.
Gross domestic product grew 0.1 percent from the previous three months, when it expanded a revised 0.5 percent, Statistics Finland said on its Web site today. The median estimate of six economists in a Bloomberg survey was for growth of 0.2 percent. Annual economic growth slowed to 1.3 percent from a revised 2.5 percent.
“I was shocked,” said Pasi Sorjonen, chief economist at the ETLA research institute in Helsinki, who had forecast growth of 0.4 percent. “The numbers were much worse than I thought.”
Consumer spending, which has helped Finland’s economy to weather the impact of the U.S.-led financial crisis, stalled in the third quarter, declining 0.1 percent from the previous three months. Exports slid 3.4 percent in the same period as a recession in the euro region and the U.S. undermined demand.
Growth and demand are slowing in Finland’s main export partners. The drop in the price of crude oil to $43 a barrel from a record $145 in July is crimping expansion in Russia, the world’s largest exporter of energy, while Germany and Sweden both entered a recession in the second quarter.
Economic growth in the Nordic nation, which is part of the euro region, will slow to 2.5 percent this year and 0.5 percent next year from 4.5 percent in 2007, according to estimates by the Finance Ministry.
“Maybe in these conditions it is an optimistic analysis,” Finland’s Prime Minister Matti Vanhanen said on Dec. 4. “We are not immune to what happens in our main trading area.”
To contact the reporter on this story: Kati Pohjanpalo in Helsinki at kpohjanpalo@bloomberg.net
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