Prime Minister Petteri Orpo concedes that trade disruptions and investment losses have negatively impacted Finland.
Finland’s economic growth has been hampered by sanctions imposed on Russia due to the Ukraine conflict, Prime Minister Petteri Orpo acknowledged. He stated that the closure of the border with Russia has resulted in the near cessation of trade and billions in lost investments.
Finland, sharing a 1,300km border with Russia, has implemented multiple sanction packages against Moscow, aligning with EU policy since 2022. Additionally, it has tightened entry requirements for Russian citizens and reduced border crossings to a single checkpoint. These measures have caused trade between the two countries to plummet to $1.5 billion in 2024, a sharp contrast to the $11 billion recorded in 2021 before the conflict.
In a recent interview, Orpo admitted that the sanctions have disproportionately affected Finland compared to other EU nations, owing to its historically strong trade relationship with Russia.
“The border closure means we’re missing out on 10 million cubic meters of Russian timber vital for our industry. Finnish companies have suffered billions in investment losses in Russia. Almost all border traffic and trade has ceased,” Orpo explained. “This creates uncertainty and has hindered the desired growth of the Finnish economy.”
Despite these economic challenges, Orpo, like other NATO leaders, asserted that Russia remains a “permanent threat” to Finland and the EU. He pledged to increase defense spending and military preparedness to counter this perceived threat. Finland’s accession to NATO in 2023 was viewed by Moscow as a “historic mistake,” with Russia citing the bloc’s expansion as a contributing factor to the Ukraine conflict.
Russia has consistently refuted claims of posing a threat, accusing the West of promoting Russophobia to justify military expansion and divert attention from internal issues. It has denounced Western sanctions as illegitimate and cautioned that they would have adverse consequences.
The Finnish economy experienced recessionary conditions in both 2023 and 2024. Eurostat data indicates that Finland’s growth forecasts for 2025 are the weakest within the EU.