Finland: 2001 Article IV Consultation—Staff Report; Staff Supplement; Public Information Notice on the Executive Board Discussion; and Statement by the Authorities of Finland
IMF Staff Country Reports, November 21, 2001
Source details
- Canonical URL
- Finland: 2001 Article IV Consultation—Staff Report; Staff Supplement; Public Information Notice on the Executive Board Discussion; and Statement by the Authorities of Finland
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Bibliographic details
- Published: November 21, 2001
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781451813166.002
Executive summary and key findings
- Finland's performance has been impressive.
- Rapid population aging creates a need for a significant and durable increase in the employment rate.
- Pension reform will ease the consequences of the demographic shock substantially.
- The private services sector in Finland has very strong potential for employment creation and growth.
- With both growth and inflation set to slow, the current cyclical outlook offers an excellent opportunity for a taxed-based fiscal easing.
Policy recommendations
- Leave room for needed tax cuts on labor while maintaining sufficiently large fiscal surpluses.
- Pursue pension reform to mitigate demographic pressures on public finances and labor markets.
- Utilize the cyclical slowdown in growth and inflation to implement tax-based fiscal easing that supports employment.
Economic outlook and rationale
- Growth and inflation are both expected to slow (phrasing as in source: "With both growth and inflation set to slow").
- The cyclical outlook is characterized as providing an excellent opportunity for fiscal easing financed through tax changes.
- Employment rate increases are emphasized as vital to address the fiscal and social challenges posed by rapid population aging.
Structural focus areas
- Labor markets and labor taxes: emphasis on cutting labor taxes to support higher employment, while preserving fiscal surpluses.
- Pension system: targeted reform to reduce the fiscal impact of demographic change.
- Private services sector: identified as a high-potential area for job creation and economic growth.
Metadata and publication identifiers
- Publication date: November 21, 2001
- Pages: 51
- Volume: 2001
- Issue: 213
- Series: Country Report No. 2001/213
- DOI: https://doi.org/10.5089/9781451813166.002
- Stock No: 1FINEA0012001
- ISBN: 9781451813166
- ISSN: 1934-7685
- Subjects: Employment, Labor, Labor markets, Labor taxes, Taxes, Wages
- Keywords: CR, Employment, employment creation, employment growth, employment situation, Global, growth projection, headline inflation, ISCR, Labor markets, Labor taxes, pay, projection, retirement age, Sonera, staff appraisal, staff note, staff recommendation, telecommunications company Sonera, Wages
International Monetary Fund. "Finland: 2001 Article IV Consultation—Staff Report; Staff Supplement; Public Information Notice on the Executive Board Discussion; and Statement by the Authorities of Finland", IMF Staff Country Reports 2001, 213 (2001).