History of Finland - Recent History

Recent History

The GDP growth rate has since been one of the highest of OECD countries and Finland has topped many indicators of national performance.

Until 1991, President Mauno Koivisto and two of the three major parties, Center Party and the Social Democrats opposed the idea of European Union membership and preferred entering into the European Economic Area treaty. However, after Sweden had submitted its membership application in 1991 and the Soviet Union was dissolved at the end of the year, Finland submitted its own application to the EC in March 1992. The accession process was marked by heavy public debate, where the differences of opinion did not follow party lines. Officially, all three major parties were supporting the Union membership, but members of all parties participated in the campaign against the membership. Before the parliamentary decision to join the EU, a consultative referendum was held on April 16, 1994 in which 56.9% of the votes were in favour of joining. The process of accession was completed on January 1, 1995, when Finland joined the European Union along with Austria and Sweden. Leading Finland into the EU is held as the main achievement of the Centrist-Conservative government of Esko Aho then in power.

In the economic policy, the EU membership forced large changes. While politicians were previously involved in setting interest rates, the central bank was given an inflation-targeting mandate until Finland joined the eurozone. During Prime Minister Paavo Lipponen's two successive governments 1995–2003, several large state companies were privatized fully or partially. Matti Vanhanen's two cabinets followed suit until autumn 2008, when the state became a major shareholder in the Finnish telecom company Elisa with the intention to secure the Finnish ownership of a strategically important industry.

In addition to fast integration with the European Union, safety against Russian leverage has been increased by building fully NATO-compatible military. 1000 troops (a high per-capita amount) are simultaneously committed in NATO and UN operations. Finland has also opposed energy projects that increase dependency on Russian imports. At the same time, Finland remains one of the last non-NATO members in Europe and there seems to be not enough support for full membership unless Sweden joins first.

The population is aging with the birth rate at 10.42 births/1,000 population or fertility rate at 1.8. With median age at 41.6 years Finland is one of the oldest countries.