HELSINKI, March 11 (Xinhua) --The Bank of Finland on Friday revised down its predictions for the country's economic growth this year to between 0.5 percent and 2 percent, citing the impact of the Ukrainian crisis.
The economic effects "will depend essentially on both the duration and the extent of the conflict," Bank of Finland Governor Olli Rehn said in a press release. Europe and Finland are compelled to "reshape their economies and intensify economic and security policy cooperation," he said.
If the repercussions are limited to 2022, a 2 percent gross domestic product (GDP) growth could be realistic. However, if the export markets weaken further and energy and raw material prices remain high, Finland's GDP growth could be as little as 0.5 percent in 2022-2023.
"Finding replacements for the loss of the Russia market takes time," the bank said. "In both scenarios, inflation in Finland is expected to rise this year to between 4 percent and 5 percent."
Last December, the Bank of Finland projected 2.6 percent GDP growth for the country in 2022, 1.5 percent growth in 2023 and 1.3 percent in 2024.
On Friday, Finland's OP Financial Group estimated the country's GDP growth at 2 percent this year and 1 percent in 2023. Both figures are 0.7 percentage points below the group's January projections. The OP Financial Group expects inflation in Finland to reach 4.4 percent this year.
The inflation rates projected by both the Bank of Finland and the OP Financial Group are the highest in Finland since 1990. ■