Keynote speech by H. E. Mr Martti Ahtisaari,

President of the Republic of Finland

Bangkok, January 24, 1995

Excellencies

Ladies and Gentlemen

I am pleased to have the opportunity to address this distinguished audience of leaders of Thai business and industry.

We Finns have learned during our history how important it is to maintain good and friendly relations with our neighbours. However, it is equally important to have close friends outside one's immediate vicinity, too. Thailand is one of Finland's oldest friends. The Kingdom of Siam recognized Finnish independence 75 years ago, the second non-European country after the United States to do so.

The first Finnish envoy to Tokyo, Professor Ramstedt, was also accredited to Bangkok from 1919 onwards. He was a well-known scientist who specialized in oriental languages, and was also renowned for his diplomatic skills. In the 1920s, however, he was criticized by the already influential pulp and paper industry for not taking a keen interest in export promotion.

Our relations with Thailand have always been most cordial. I am happy to say that there are not, and there have never been, any problems between our two countries. Our political and economic aspirations aim in the same direction. We are strong supporters of the United Nations and we are committed to the principles of free trade.

Over the years, relations between our countries have developed well and cooperation has spread to many fields. The main emphasis for quite some time now has been on commercial and economic activities.

During recent years, Thailand has become one of Finland's most important trading partners in Asia. In 1993, Thailand was the second largest market for Finnish exports in Asia, immediately after Japan. Though our exports fell to half last year, we are confident that our bilateral trade will continue to expand in the future.

I believe that Finland has plenty of advanced technology well suited to the vast infrastructure projects going on in Southeast Asia. Finland is very competitive, and even a world leader, precisely in the sectors where demand is now strongest, namely in telecommunications, energy, forestry, environmental technology and shipbuilding. High-technology or technology-intensive products play a major role in our exports here. This is not strange: R&D-intensiveness and export-orientation are among the key characteristics of many of our enterprises.

For obvious reasons, forestry is the field of industry in which the Finns do not need to introduce themselves anywhere in the world. The cooperation between Finland and Thailand in the forestry sector is solidly rooted. When your former Prime Minister Prem Tinsulanonda visited Finland in 1988, it was agreed that Finland would provide technical assistance with the preparations of a forestry sector 'Master Plan'.

I am pleased to announce in this context that the Finnish industry is willing to support the education of all levels in the field of forestry and forest industry, including new scholarships for younger Thai industrial leaders. The idea od the scholarships is to give an opportunity to get acquainted with advanced Finnish technologies and related business in Finland.

Ladies and Gentlemen:

Finland became a member of the European Union at the beginning of this year. It was our greatest political decision since the Second World War. We Finns are a thoroughly European nation. For centuries, we have interacted with both West and East. Our democracy, legal system and culture are anchored in the Nordic tradition. Our economic system has always been based on a market economy, private ownership and the entrepreneurial spirit. Against this background, it was only natural that Finland wanted to join the main European organization representing the same values.

Joining the EU was essential for our export industry and for our economy in general. Finland's most important trade partners and main markets have always been in Western Europe. As much as 60% of our exports go to the single European market. But at the same time - bearing in mind its dominant sectors - our industry will operate globally. Asia, and especially the most dynamic region Southeast Asia, is therefore of utmost importance for Finland and for Europe in general.

Thailand has always served as a first springboard for Finnish companies in penetrating markets in Asia. Now, particularly, Thailand is seen as a gateway to the opening markets of Indochina.

Economic development in Southeast and East Asia has been impressive in recent years. It is obvious that these regions are evolving into economic powers comparable in every respect with Europe and North America. Eventually, they will be fully capable of bypassing them in terms of the dynamism and overall size of the economy. Some observers feel that this will take place sooner rather than later.

We Finns find this vision of the future a most promising one for the world economy as a whole. Finland is a strong proponent of an open multilateral trading system. We worked actively for the success of the recently concluded GATT round, and resisted manoeuvres that could in one way or the other undermine progress towards free trade. We must, however, recognize that we will be dealing with complicated issues within the framework of the WTO. For instance, we certainly support efforts to improve labour standards and standards of environmental protection, but we remain firmly opposed to attempts to turn these efforts into protectionism of one sort or another.

Parallel with developments in the GATT/UR, we have been following with keen interest the plans and recent initiatives in the field of regional economic cooperation and integration in Asia. In particular, we welcome the liberal spirit in which they are being envisaged and implemented: instead of creating barriers, they seem to aim at facilitating market access. Thus they effectively complement the GATT and the WTO, a development that I believe will be in the interests of us all.

Ladies and Gentlemen

As you might be aware, Finland experienced a very severe economic recession in recent few years, but recovery is now under way. The GDP growth estimates for this year are already between 5 and 6%. Our import demand is also expanding briskly.

I am convinced that the accession of Finland to the European Union improves the prospects for sound and dynamic development of the Finnish economy. As a member of the Union, Finland commits itself to the common economic and monetary goals of the EU, a fact which will make our economic policy more credible. The lucrativeness of Finland as a base for economic activity will increase now that we are an integral part of the most important common market in the world. These factors will lead to lower interest rates and strengthen the Finnish currency, which will in turn accelerate both domestic and foreign investment.

The very substantial changes that have taken place in recent years in the geoeconomic and geopolitical location of Finland have created new business opportunities for overseas companies there. Our membership of the European Union means that, through Finland, foreign companies now have unlimited access to a huge single market of nearly 400 million people. The new 'Northern Europe', which comprises not only the Nordic countries but also the western parts of Russia and the Baltic republics offers huge future potential to foreign businesses and businessmen. The overall population of the area is about 70 million.

Europe and Asia, and in particular the European Union and the ASEAN region, have developed an interdependence of great value also on a global scale. This enhances security, development, the economy and human rights. As a new member of the EU, Finland encourages intensified cooperation with Asia. The EU's new Asian strategy provides a good basis for developing a more balanced partnership which also takes into account and respects differences between national cultures and traditions. In many respects, this dialogue and the wide-ranging cooperation between the EU and ASEAN can be regarded as an essential driving force in strengthening ties with Asia.

Ladies and Gentlemen,

As to the future outlook, there is, in my view, still much more potential on both sides which should be tapped. Therefore, I am especially glad that so many Finnish companies are represented in my delegation. These companies are already familiar with the existing business potential here, but I hope that this seminar will yield new ideas and provide opportunities for personal contacts at the highest corporate level, and thus give a new boost to cooperation between the industries of our two countries.