VII. INVESTMENT CLIMATE GOVERNMENT ATTITUDE TOWARD FOREIGN PRIVATE INVESTMENT Openness to Foreign Investment The Finnish government maintains a favorable attitude toward direct foreign investment in Finnish business. In the past two years, Finland has moved from an investment regime which discouraged foreign ownership to one which has removed nearly all obstacles to foreign ownership. Foreign investment in Finnish companies has increased dramatically. Description of the Basic Laws In December 1992, the Finnish Parliament enacted a law, Decree No. 1612/92), removing most restrictions on foreign acquisition of shares in Finnish companies and Finnish real estate; the new law entered into effect January 1, 1993. In addition, Finland is required by the European Economic Area (EEA) agreement to bring its investment legislation into conformity with EC law by 1996 at the latest. However, new legislation will have made most of the mandated changes at the beginning of 1993. As a general rule, most Finnish trade legislation changed as part of the implementation of the EEA agreement at the beginning of 1994 so that Finnish citizenship requirements will be changed to "a person with domicile in the EEA". Decree No. 1612/92 repealed the so-called Restriction Act (the Law on the Right of Foreigners and Certain Foreign Entities to Possess and Govern Fixed Property and Shares, implemented in Decree No. 219/39) passed in 1939. Until January 1, 1993, the Restriction Act and separate foreign exchange legislation had governed investment by foreigners in Finland. Although a number of amendments had been made to the Restriction Act over the years (the most important in 1982 and 1987), the main contents of the Act have remained unchanged until now. Foreign exchange controls had been progressively dismantled in recent years, so that in practice the Restriction Act had been the key instrument regulating foreign investment in Finland. Under the new legislation, foreign owners can no longer be discriminated on the basis of companies' articles of association, nor can any limitations be imposed on their voting rights at shareholders' meetings. One of the results of the abolition of the Restricting Act is the elimination of "foreigners clauses," removing the distinction between "restricted" shares that only a Finn can buy and "free" shares open to purchase by everyone. This new legislation makes no distinction between citizens of the EEA countries (the EU and EFTA) and those of other countries. Further, foreigners will also be able to purchase real estate in Finland, including forest land, with no restrictions. The sole exception is the purchase of vacation homes by foreigners, which will continue to be regulated by local authorities. (See Section A6) However, for the time being, the Ministry of Trade and Industry retains limited control of corporate acquisitions. Under this system, large companies (with a turnover exceeding FIM 1 billion -- $180 million -- and with more than 1,000 employees) are required to inform the Ministry of any transactions involving the transfer of more than a third of their voting rights to foreign owners. The Ministry can refuse to approve any such transaction if it is deemed to endanger Finland's national interests, generally considered to mean security issues, such as fuel and power. In practice, it is not likely that this veto will ever be exercised, and in any case it will remain in effect only during the transition period allowed under the EEA agreement, i.e. until the end of 1995. Banking and Insurance In connection with the rescission of the Restriction Act, foreign ownership of banks and insurance companies was also liberalized. Foreign ownership of Finnish banks is covered by a separate law, the Act on the Right of Foreigners to Own Shares in a Finnish Credit Institution and to Carry on Banking Activity in Finland, implemented in Decree 687/79. While voluntary insurance can be obtained from foreign insurance companies, mandatory labor pension insurance and, until an agreement between Finland and the EU is concluded, mandatory workers' compensation must be obtained through Finnish insurance companies. Legislation liberalizing foreign investment in the Finnish financial sector was submitted to Parliament as part of a larger package of legislation anticipating the EEA agreement, and went into effect on the first of January 1993. The removal of restrictions on foreign investment in banking and insurance parallels liberalization in other sectors: all restricted shares have been converted into free shares. While there is no formal monitoring of foreign investments as is the case with large non- financial companies, "qualitative control" for all large investments, domestic and foreign, will remain in effect. This system involves government monitoring of all large share purchases in financial institutions to ensure that the purchaser is a "safe and stable entity" having sufficient capital and whose management is seen to be reliable. Under the new law, foreign investors are permitted 100 percent ownership in all sectors, except those restricted for national security purposes, and are treated the same as domestic investors in similar situations. In connection with the EEA agreement, most restrictions on insurance marketing have been removed as well, although for certain types of insurance, including medical malpractice and motor vehicle insurance, a company will have to maintain an office in Finland in order to market the insurance. For insurance involving labor pensions or personal injury, a license from the government will be required. As of July 1, 1994 Finnish insurance legislation will be the same as that of the EU, except for that governing labor pensions. In addition, Finland and the EU are working toward an agreement on statutory workers' compensation. Finland is seeking permission to treat the labor pension system in the same manner (mandatory labor pensions are handled by branches of private insurance companies under the Finnish system). The latest amendments to Finnish financial institution laws became effective on the first of January 1994, comprising a law on financing institutions (code 1607/93) and a law on the operations of foreign banks and financing institutions operating in Finland (code 1608/93). These two new laws bring the Finnish legislation in line with that of the EEA. Under these regulations, there is a requirement that the key personnel maintain a residence in the EEA. Investment Screening Mechanism With the recent change in legislation, most foreign companies which make Finnish acquisitions no longer need to apply for licenses, but only need to register their status with the MTI as Finnish firms do. The one exception is covered below and concerns the largest Finnish firms. Under the new legislation, the main restriction on foreign investment is an interim screening mechanism for a three-year transition period ending in 1995. The screening procedure for defense industries will, however, be permanent. The government will monitor procedures for acquisitions involving a third or more of the stock of large Finnish companies. Just over 100 companies having 1000 or more employees or an annual turnover or year end assets of at least FIM one billion ($180 million) will be affected by this provision. Foreign firms will need to apply to the MTI for confirmation of such acquisitions involving these large firms. The law states that potential investments involving these companies must be monitored to ensure that "essential national interests" are not jeopardized. This term is defined as safeguarding national defense or preventing serious economic, social, or environmental difficulties, or securing the general order, safety, and health. While the new monitoring criteria appear broad, the MTI, which administers the screening program, has stated publicly that investments in Finnish companies involving foreigners would be prevented "only in very extreme circumstances." To date, no proposed turnovers have been blocked. The screening provisions affect only the transfer of shares of existing companies to foreign ownership, not the establishment of new companies. Sectoral and Geographical Restrictions The new law places some restrictions on the purchase of real estate used for leisure or recreation. This provision, designed to monitor purchases of vacation homes, mandates that permission for a foreigner to buy real estate can be denied by local authorities if it jeopardizes the domestic population's chances to purchase a vacation home. Likewise, permission could be denied if the use of this property for a leisure home could hamper environmental protection or use of the property for general recreational activities. Applications would be screened by provincial governments. The definition of "foreigner" for this purpose is "a person who has not lived five successive years in Finland at any time, or a person not intending to live in Finland for at least one year at the time of purchase". The single geographical restriction on investment concerns the Aland Islands, which have a special historical status and extensive autonomy. International agreements dating as far back as 1921 limit property ownership and the right to conduct business to only those individuals permanently residing on the islands. Establishment of or interest in a number of businesses (eg. banking, insurance, public media, some transportation, etc.) require a license from the appropriate Ministry; licensing depends on fiscal soundness, not the nationality of the applicant. National limitations will be abolished as part of the EEA in the communication sector, and there will be no distinctions made among Finnish, EEA, or third country citizens in the granting of licenses, provided that the managing director (in the case of print media, the editor-in-chief) be domiciled in Finland, or that the company have a branch office in Finland. Investment Incentives There are no specific incentives available for direct foreign investment, although all companies registered in Finland have equal access to government assistance under special development programs. Upon application, the Ministry of Trade and Industry, together with the Regional Development Fund (KERA), a state- controlled credit institution, may provide assistance and subsidies to an enterprise established in a region designated as a developing area or which is expanding its operations into such an area. These firms receive tax relief in the form of accelerated depreciation allowances, additional investment tax credits, and exemption from the real estate stamp tax. Start-up subsidies, transportation subsidies, investment loans, marketing promotion, and management training are also provided by KERA. The European Surveillance Authority (ESA), a body established with the implementation of the EEA, has the responsibility to ensure that all subsidies are in conformance with EU strictures. Finland is obligated to inform the ESA of all available subsidies and report any new subsidies. The ESA will decide on whether or not to allow these subsidies, and will check that they do not distort competition. Transportation subsidies may still be allowed as part of Finland's EU agriculture package. The Finnish government provides aid and loans for the development of technology, new products, and production methods to improve the international competitiveness of Finnish products and to diversify the industrial structure. The government may also finance research projects and provide grants to meet a portion of export promotion costs. Other incentives designed to smooth out business cycle fluctuations include tax-free transfers of capital for future capital investments, temporary reductions in employer social security contributions and turnover taxes on machinery and equipment investment, and various interest subsidies. In the past, Finnish officials have encouraged investment in regions designated as "developing" to increase employment and diversify the economy, but due to the recession, all of Finland is eligible. Investment in the area around Helsinki has now been included in government incentive programs as well. For the purpose of assigning regional subsidies, Finland is divided into three areas, while it is divided into ten areas for structural investment subsidies. Helsinki is eligible for certain "developing area subsidies" such as interest subsidies for investments or export promotion subsidies. Export and Import Policies Finland maintains no discriminatory export or import policies aimed at forcing investment. As a small country heavily dependent on foreign trade, Finland is by necessity oriented towards free trade. Finland is a member of EFTA, participates actively in the GATT, and has applied to join the EC. About two- thirds of Finnish trade is with EEA countries. The average tariff for items subject to import duties is nine percent. The overall incidence of duties on all imports is approximately 1.2 percent. About 90 percent of Finnish imports enter duty-free. The only significant Finnish direct export subsidies are for agricultural products, including grain, meat, butter, cheese, and eggs as well as for some processed agricultural products. Finland is a member of the GATT Subsidies Code. Finland's non-tariff barriers mostly apply to agricultural imports, and consist mainly of quantitative restrictions to support high-cost domestic agriculture. The system of agricultural support is currently being modified to resemble the EU's system of variable levies and will change further still if Finland joins the EU. If and when Finland joins the EU, Finland will adopt EU customs tariffs. There will be transition periods for some products for which Finnish tariffs are higher and requests for tariff suspensions in several cases where the Finnish tariffs are lower or at the zero level. Finland currently has excise taxes on ten product categories but may reduce the scope of these taxes in line with EU practice. Investment Promotion In connection with the investment liberalization legislation, the Finnish Foreign Trade Association, a business group receiving government support, has established an "Invest in Finland Bureau." The bureau's purpose is to provide potential investors with detailed information on the business environment in Finland and to promote Finland as a business "gateway" to Russia and the Baltic countries. The address of the Foreign Trade Association is: Arkadiankatu 2 P.O. Box 908 00100 Helsinki, Finland Tel: 358-0-695-9230 Fax: 358-0-694-0028 Telex: 121696 Trade SF Conversion and Transfer Policies In October 1991, the Bank of Finland dropped all controls regarding foreign loans, thus completing the abolition of exchange controls in Finland. There are no restrictions on transferring investment capital or profits abroad in freely convertible currencies at a legal market rate. There is no limit on dividend distributions, as long as they correspond to a company's official earnings records. If a foreign company ceases operations, all assets may be repatriated without restriction. The Bank of Finland compiles the country's balance of payments data. To that end, the Bank collects data on all payments between Finnish residents and nonresidents and conducts surveys covering the major financial institutions, businesses, and securities brokering firms. The information the Bank collects includes: reports on foreign payments (foreign exchange reporting, use of payment accounts held abroad, etc.) and surveys (foreign claims and liabilities of enterprises, financial institutions, municipalities, and the central government; foreign direct investment in Finland, etc.) Expropriation and Compensation Private property rights are well protected in Finland. There have been no cases of expropriation or nationalization since the Second World War. Dispute Settlement In 1969, Finland became a member of the International Center for the Settlement of Investment Disputes (ICSID). There is no record of any significant investment dispute in the last three decades. Performance Requirements There are no performance requirements or commitments imposed on foreign investment in Finland. However, there are some residency requirements and "mail box" companies are not allowed (see section A1 - Description of Basic Law). In the case of a non- resident owner of a Finnish company, one-half of the key personnel must reside in the EEA, or a special permit must be obtained from the MTI. Right to Private Ownership and Establishment In most fields of business activity there are no bars to participation by foreign companies or individuals. However, foreigners may not engage in business in fields related to national security and defense, as well as in private security services and road construction (seen as related to national defense). Other closed sectors are the broadcast media, the print media, cable TV and real estate brokerage. Outside of these restrictions, private entities may freely establish, acquire and dispose of interests in business enterprises. (See section A1). Competitive equality is the official standard applied to private enterprises in competition with public enterprises. Private companies do not face discrimination. There are no obstacles for foreigners to participate in the privatization of state enterprises except when the state enterprises concern national security. The full or partial privatization of several state- owned companies had been scheduled to begin in 1992 but was postponed until 1993, ostensibly because Finland's deep recession and the companies' poor performance made them unattractive investment opportunities. Privatization of several large state- owned firms has started, albeit slowly. The EU accession treaty as negotiated allows Finland to have a five-year transition period on eliminating restrictions on property acquisition. Some restrictions may remain for the protection of natural resources. Protection of Property Rights The Finnish legal system protects property rights, including intellectual property, and Finland adheres to numerous international agreements concerning intellectual property. The one major exception to effective protection, discussed below, will cease to exist in 1995. Finnish laws concerning intellectual property rights are the Patent Law (code 550/67), the Law on Utility Models (800/91), the Trademark Law (7/64), the Registered Designs Act (221/71), the Law on Exclusive Rights to Integrated Circuit Layout Design (32/91) and the Copyright Act (404/61). Finland is a member of the following agreements: the Paris Convention of March 1883 for the Protection of Industrial Property, the Patent Cooperation Treaty of June 1970, the Budapest Treaty of April 1977 on Patent Procedure for Microorganisms, the Strasbourg Agreement of March 1971 on International Patent Classification, the Nice Agreement of June 1957 on the International Classification of Goods and Services for the Purposes of the Registration of Trademarks, the Locarno Agreement of October 1968 on the International Classification for Industrial Designs, the Berne Convention of September 1886 for the Protection of Literary and Artistic Works, the Rome Convention of October 1961 for the Protection of Performers, Record Producers and Broadcasting Organizations and the Geneva Convention of October 1971 for the Protection of Record Producers Against Unauthorized Duplication. Finland had earlier refused to recognize product patents for pharmaceuticals, in favor of process patents. After lengthy discussions with the United States Government, Finland agreed in 1987 to adopt product patents for pharmaceuticals effective at the beginning of 1995. Computer programs, which once received inadequate legal protection, have been covered by the Copyright Act since January 1991. The Finnish Copyright Act, which also grants protection to authors, performing artists, record producers, broadcasting organizations and catalog producers, is currently being amended to correspond to EU directives which will be adopted as part of the EEA agreement. The Copyright Act provides for sanctions ranging from fines to imprisonment for up to two years. Search and seizure are authorized in the case of criminal piracy, as is the forfeiture of financial gains. Information on copying and copyright infringement are dealt with by the Copyright Information and Anti-Piracy Center, established in 1979. This body is made up of copyright associations and owner rights associations, including the Motion Picture Association of America. The trademark law is currently being amended to put protection on a sliding scale so that the better known the product or its characteristic feature, the wider its protection. The use of a trademark is not a prerequisite for its registration in Finland. However, registration of a trademark can be forfeited if the trademark is not used for five years without a valid reason. Trade secrets are protected by the Law on Inappropriate Business Behavior, which enjoins corporate espionage. Semiconductor chip layout design is protected by the Law on the Exclusive Right for Integrated Circuit Layout Design (32/91) and its implementing decree (946/91). Through the EEA Agreement, Finland must modify its legal system to comply with EU directives. Regulatory System: Laws and Procedures European integration in general and the European Economic Area in particular have provided Finland with the impetus to update its competition policy, culminating in the Act on Restriction on Competition, which came into force on the first of September 1992. This law bring Finland largely into line with EU practice on competition policy, making it more difficult for companies to collude on prices and market share. Seldom-applied criminal sanctions have been replaced with civil penalties as high as four million finnmarks ($725,000) or as much as ten percent of a company's turnover. The principal remaining difference with EU legislation is that Finland does not screen proposed large mergers and acquisitions before the fact, but Finnish authorities will act to break up such arrangements if it is determined that the new entity is restricting competition. Finnish tax, labor, health and safety, and related laws and policies are largely neutral towards the efficient mobilization and allocation of investment. Taxation of capital is being standardized in part to further this goal. Finnish legislation does not normally influence the regional distribution of investments except when specifically designed to do so, such as through regional incentive programs. Efficient Capital Markets and Portfolio Investment Finnish policies have been designed to facilitate the free flow of financial resources. Credit is available on market terms and foreign investors are able to get credit on the local market on an equal footing with Finnish investors. Although Finland does not have as wide a variety of credit instruments as the United States, the private sector has access to all that are available. The legal, regulatory and accounting systems are transparent and are consistent with international norms. The Finnish regulatory system presents no obstacles to portfolio investment; recent changes in capital taxation have encouraged portfolio investment and reduced corporate borrowing on capital markets. The estimated total assets of the five largest banks in Finland is FIM 533.2 billion ($98.7 billion) as reported in December 1993. Political Violence There have been no instances of political violence since the struggle for independence in 1918. BILATERAL INVESTMENT AGREEMENTS Finland has concluded bilateral investment agreements with the following countries: Bulgaria, China, the Czech Republic, Egypt, Estonia, Hungary, Latvia, Lithuania, Malaysia, Poland, Romania, Russia, Sri Lanka, and Uzbekistan. OPIC AND OTHER INVESTMENT INSURANCE PROGRAMS In August 1992, OPIC and the Finnish Fund for Industrial Cooperation (Finnfund) signed a Principles of Cooperation Agreement. The two organizations agreed to share information concerning opportunities for private investment, exchange knowledge of techniques for the encouragement and sustenance of investment, including approaches to risk mitigation and management, and encourage cooperative enterprises among their nationals to finance private investment in developing economies. The former Soviet Union and Eastern Europe are particular points of emphasis. Finland has been a member of the Multilateral Investment Guarantee Agency (MIGA) since 1988. LABOR Finland has a highly educated and skilled work force. Historically, unemployment has been low and some skills have been in short supply due to low turnover. However, with unemployment at almost 20 percent in mid-1994, labor availability is not now a problem, although there is a slight shortage of highly skilled technical workers in the shipbuilding and telecommunication industries. High labor costs have been ameliorated by a large currency depreciation since November 1991, making Finnish labor relatively less expensive than was the case during the eighties. Indirect labor costs remain high at about 84 percent of direct costs in manufacturing, slightly lower in services. The cost of Finnish labor has led much of Finnish industry to use labor- saving high technology. Labor relations in Finland have been conducted within the framework of a highly centralized system of national negotiations on wages and working conditions for the past several decades. This traditional system has come under increasing strain, however, and no centralized agreements were conducted in 1993. Labor relations are generally harmonious. About 80 percent of the work force is organized; nonunion employers must pay minimum union scale. Work rules can be flexible and unions often insist they be observed strictly. The average work week is 38 hours. Finland adheres to most ILO conventions; enforcement of worker rights is generally effective. FOREIGN-TRADE ZONES/FREE PORTS Finland's only free port is Hanko, located at the southernmost tip of the country. Hanko harbor is the only consistently ice- free port in Finland, and has a railway-ferry link with Travemunde in Germany. In addition, there are several free storage areas in other locations: Espoo, Helsinki, Joensuu, Kemi, Kotka, Kuopio, Lahti, Lappeenranta, Loviisa, Naantali, Oulu, Pori, Rauma, Tampere, Turku, Vaasa, Vantaa, and Virolahti. The free storage areas are usually run by municipal corporations. The free storage areas are available to all companies, both domestic and foreign-owned. Warehousing, assembly and manufacturing are allowed in these areas, with government permission obtained through the Board of Customs. CAPITAL OUTFLOW POLICY No policies exist governing the export of capital and outward direct investment. Holders of capital, Finnish and foreign, can move funds at will. Finnfund, the Finnish counterpart of OPIC, provides insurance and financing for investment in developing countries. FOREIGN DIRECT INVESTMENT STATISTICS Source: Bank of Finland statistics Average exchange rates: 1990 1 USD = 3.831 FIM 1991 1 USD = 4.053 FIM 1992 1 USD = 4.484 FIM 1993 1 USD = 5.719 FIM The Finnish GDP was FIM 475.674 billion ($106.083 billion) in 1992, and FIM 471.443 billion ($82.435 billion) in 1993. The stock of foreign direct investment in Finland in 1992 was FIM 19.260 billion, accounting for 4.0 per cent of GDP, and in 1993 was FIM 22.650 billion, accounting for 4.8 per cent. In 1992 foreign direct investment inflows (FIM 1.777 billion) were 0.3 per cent of GDP and in 1993 were around 0.7 per cent (estimated inflows were FIM 3.390 billion). FOREIGN DIRECT INVESTMENT STATISTICS STOCK OF FOREIGN DIRECT INVESTMENT IN FINLAND BY REGION OF DESTINATION, 1991 AND 1992 (FIM BILLION) Region of Direct Investor 1991 1992 ------------------------- ---- ---- EFTA 9.045 9.422 EU 4.409 4.816 North America 2.323 3.356 Other 1.666 1.666 ------ ------ -- TOTAL 17.443 19.260 STOCK OF FOREIGN DIRECT INVESTMENT IN FINLAND BY INDUSTRY SECTOR DESTINATION, 1991 AND 1992 (FIM BILLION) Sector 1991 1992 ------ ---- ---- Manufacturing 7.793 10.137 Metal & Engineering (4.619) (6.381) Chemical (1.018) (1.122) Other (2.156) (2.634) Trade 6.758 6.382 Finance and Insurance 0.539 0.792 Other 2.353 1.949 ------ ------ -- TOTAL 17.443 19.260 Stock of foreign direct investment in Finland at the end of 1993 is estimated at FIM 22.650 billion. STOCK OF FINNISH DIRECT INVESTMENT ABROAD BY REGION OF DESTINATION, 1989 AND 1990 (FIM BILLION) Region 1991 1992 ------ ---- ---- EC 25.919 29.199 EFTA 11.237 13.169 North America 9.515 11.232 Other 4.095 4.761 Not Classified (1) 2.794 3.298 ------ ------ -- TOTAL 53.560 61.659 (1) Households' real estate and dwellings investments. STOCK OF FINNISH DIRECT INVESTMENT ABROAD BY INDUSTRY SECTOR DESTINATION, 1991-1992 (FIM BILLION) Sector 1991 1992 ------ ---- ---- Manufacturing 41.230 48.259 Forest (6.577) (5.970) Chemical (10.216) (10.531) Metal & Engineering (17.228) (22.137) Other (7.209) (9.621) Trade 0.968 0.807 Finance and Insurance 6.681 7.962 Other 1.887 1.333 Households' Investments in Real Estate and Dwellings 2.794 3.298 ------ ------ -- TOTAL 53.560 61.659 Stock of Finnish direct investment abroad at the end of 1993 is estimated at FIM 72.818 billion. NET FOREIGN DIRECT INVESTMENT INFLOW TO FINLAND BY COUNTRY OF ORIGIN, 1990-1993 (FIM MILLION) Country 1990 1991 1992(1) 1993(1) ------- ---- ---- ---- ---- Norway 73 442 162 155 Sweden 2350 -1326 380 1266 Switzerland 245 12 213 39 -- TOTAL EFTA 2668 -872 755 1460 Belgium 59 1 39 -12 Denmark 67 171 50 140 France 76 -56 42 137 Germany 60 142 197 449 Ireland 0 0 0 60 Italy 1 10 14 -4 Luxembourg 2 0 -15 59 Netherlands 458 218 522 163 United Kingdom 23 284 17 654 -- TOTAL EU 746 770 866 1646 United States 243 -33 755 1057 Canada 0 0 67 40 -- TOTAL N. AMERICA 243 -33 822 1097 Developing Countries 19 2 1 3 Other Countries 7 54 89 -66 ---- ---- ---- ---- -- TOTAL 3683 -79 2533 4140 Reinvested Earnings -673 -918 -756 -750 ---- ---- ---- ---- -- GRAND TOTAL 3010 -997 1777 3390 (1) Preliminary information. NET FOREIGN DIRECT INVESTMENT INFLOWS IN FINLAND BY INDUSTRY SECTOR DESTINATION, 1990-1993 (FIM MILLION) Sector 1990 1991 1992(1) 1993(1) ------ ---- ---- ---- ---- Manufacturing 847 -152 1770 1586 Metals (189) (-527) (1199) (436) Chemicals (265) (73) (227) (130) Other (393) (302) (344) (1020) Trade 609 398 373 842 Finance & Insurance 126 -622 255 98 Other 2101 297 135 1614 ---- ---- ---- ---- -- TOTAL 3683 -79 2533 4140 Reinvested Earnings -673 -918 -756 -750 ---- ---- ---- ---- -- GRAND TOTAL 3010 -997 1777 3390 (1) Preliminary information. NET FINNISH DIRECT INVESTMENT OUTFLOWS BY COUNTRY OF DESTINATION, 1990-1993 (FIM MILLION) Country 1990 1991 1992(1) 1993(1) ------- ---- ---- ---- ---- Austria 6 7 0 20 Norway 1014 587 -272 244 Sweden 2532 703 966 1566 Switzerland 17 72 586 381 -- TOTAL EFTA 3572 1369 1280 2211 Belgium 397 804 960 4178 Denmark 162 70 -128 46 France 1442 678 1046 679 Germany 401 406 740 3388 Greece 13 0 2 0 Ireland 146 246 55 107 Italy 106 391 315 371 Luxembourg 162 -46 126 -57 Netherlands 1935 355 -50 596 Portugal 116 272 117 490 Spain 373 311 652 822 United Kingdom 1405 794 894 1241 -- TOTAL EU 6658 4281 4729 11861 Canada 121 261 -63 -680 United States 1747 1197 453 1774 -- TOTAL N. AMERICA 1868 1458 390 1094 Developing Countries 1058 284 386 563 Other 582 215 568 477 Households' Investments in Real Estate and Dwellings 510 551 218 19 ---- ---- ---- ---- -- TOTAL 14248 8158 7571 16225 Reinvested Earnings -1777 -3918 -5750 -5750 ----- ----- ----- ----- -- GRAND TOTAL 12471 4240 1821 10475 (1) Preliminary Information NET FINNISH DIRECT INVESTMENT OUTFLOWS BY INDUSTRY SECTOR DESTINATION, 1990-1993 (FIM MILLION) Sector 1990 1991 1992(1) 1993(1) ----- ---- ---- ---- ---- Manufacturing 6079 3561 5403 12485 Forest (1918) (708) (1392) (1373) Metal (2405) (954) (3473) (4897) Chemical (1002) (1187) (144) (4924) Other (754) (712) (394) (1291) Trade 931 1087 262 212 Finance & Insurance 1877 -870 510 450 Other 4851 3829 1178 3059 Households' Investment in Real Estate and Dwellings 510 551 218 19 ----- ---- ---- ----- -- TOTAL 14248 8158 7571 16225 Reinvested Earnings -1777 -3918 -5750 -5750 ----- ---- ---- ----- -- GRAND TOTAL 12471 4240 1821 10475 MAJOR FOREIGN INVESTORS MAJOR FOREIGN COMPANIES OPERATING IN FINLAND IN 1993 BY TURNOVER Name of the Company, Gross Invest- Country of Origin, Turnover ment in 1991 Sector of Operations (FIM mil) (FIM mil) Personnel -------------------- --------- ------------- --------- ABB Stromberg 5,580 439 7,788 Sweden/Switzerland Electronics Shell 2.691 145 748 Netherlands Oil Retail Suomen Petrooli 1,959 22 200 Russia Oil Trade Kvaerner Masa-Yards 2,757 432 3,937 Norway Shipbuilding Esso 1,588 47 384 U.S.A. Oil Retail Scansped Group 1,449 21 1,419 Sweden Transportation Teboil 4,000 88 354 Russia Oil Retail ICL Data 3,628 42 2,482 United Kingdom Computers and Data Processing Volvo-Auto 1,337 33 499 Sweden Automobile Sales Name of the Company, Gross Invest- Country of Origin, Turnover ment in 1991 Sector of Operations (FIM mil) (FIM mil) Personnel -------------------- --------- ------------- --------- Unilever 1,429 33 1,331 United Kingdom/Netherlands Diversified IBM 1,103 71 671 U.S.A. Computers and Data Processing Urals Finland 1,333 0 7 Russia Wholesale In addition the following U.S.-owned companies run a business in Finland: Digital, Computers and Data Processing Ford, Automobile Sales Nokian Paperi, U.S.A./Netherlands, Paper Hewlett-Packard, Computers and Data Processing Dow Suomi, Chemicals Unisys, Computers and Data Processing Mobil Oil, Lubricants Suomen 3M, Wholesale Product Sales Reader's Digest, Publishing Liikemainonta McCann, Advertising Kodak, Wholesale Product Sales Otis, Elevators Suomen General Motors, Automobile Sales Honeywell, Steering Technology Compaq Computer, Computers and Data Processing Waste Management Finland, Services Procter & Gamble Finland, Wholesale Food Products Genencor International, Chemicals Planar International, Electronics Ref.: Talouselama Magazine 21/1994, "The 500 Major Companies Operating in Finland."