London, 18 0ctober, 1995

May I use this opportunity to thank the Confederation of British Industries for offering us an excellent opportunity to discuss topics of mutual interest at this Council meeting of the CBI.

Great Britain has traditionally been one of the Big Three of our trading partners. Last year both our exports and imports from Great Britain grew by two-digit figures reflecting the growth of our total trade.

Britain has been the main market for our paper industries for decades. Traditionally good relations with British paper buyers and publishers have certainly made the success story of Finnish paper here possible.

We are, more than many other industrial countries, dependent on renewable natural resources. The forests are an elementary part of our economy and culture. Therefore we take good care of our forests and we are proud of the ecological way in which our "green gold" resource is managed and its biodiversity preserved. The use of modern technology is recognised as a prerequisite for saving our forest resources also for the future.

Metal and engineering is, however, the largest industrial sector in our economy. Over the years this industry has built up strong areas of technological know-how, or clusters, within which a large number of our top companies operate. They include the forest products sector, energy, mining and metallurgy, telecommunications and shipbuilding. The electronics industry is currently the fastest-growing manufacturing sector in Finland. Industrial automation, transportation, telecommunications, consumer electronics and health care are the main sub-areas in the manufacture of systems and equipment.

Forest products, engineering, and the high-tech sector are the three "flagships" of Finnish export industries. They have been of crucial importance in the recovery of our economy from the serious recession at the beginning of this decade. Rapid advances in our industrial know-how is reflected in our exports of high-tech products, which currently exceed corresponding imports. Over half of our industrial output is exported. The competitiveness of our industries is reflected in the substantial surplus which our trade account shows.

The economic recovery has coincided with our membership of the EU. Membership has changed our traditional environment in international economic relations in many ways. Belonging to the EU has brought new international dimensions to our economic policy. Membership has opened up good opportunities, but it has also set new demands for us. One of these opportunities is the Economic and Monetary Union, which has now proceeded to the second stage. For us EMU is expected to bring more stability to financial markets. To achieve that stability, it is important that we stick to the criteria agreed for the third stage. Our aim is to join the first group of countries entering the third stage of EMU.

The first months of our membership of the Union have passed smoothly and according to our expectations. From the very beginning what we hoped for from membership was rather realistic. We were not over-optimistic but satisfied ourselves that the decision to join the EU would be the right one and beneficial for us. This short period has shown that most of us still believe so. As a small member country, we have also understood that it is necessary to choose priorities in the work of the Union and promote them together with other members.

In this process we have often realized how similar our views are to those of Britain. It is in our common interest to promote and work for further liberalization of world trade. In many issues - not only in the EU but also globally - we both aim for a world with fewer trade barriers, regulations and with lower tariffs. It also lies in our common interest to promote the efficient use of EU resources and funds.

We both have many similar ideas concerning the future of Europe. There will be a very good opportunity to discuss them at the Intergovernmental Conference next year. I am confident that values like openness, dynamism and the diversity of Europe will be important items on the agenda for both of us.

The British people with whom I have recently had discussions have shown great interest in further enlargement of the Union. Our accession has further increased the EU's involvement and interest in the Baltic Sea Region and Northwestern Russia, which are our neighbouring areas.

Through Europe and Association Agreements the Baltic states have been brought into the accession strategy of the Union. We strongly support this development as it gives the Baltic states a position with regard to future enlargement similar to that of the other associated countries in Cenral Europe.

The character of our relations with Russia has undergone a considerable change in the last five years, but our interests remain, in essence unchanged. We believe that the integration of Russia into international cooperation is the best way to increase stability and prosperity in Europe and to narrow the wide gap that economic disparities create. We fully support the strengthening of relations between the EU and Russia. The PCA will provide a good framework for wider cooperation with Russia. The Russia strategy of the EU should provide guidelines on how the Union can jointly respond to the vast challenges of Russia.

Finland can offer an excellent position as a business centre in Northern Europe, an operations base for international companies serving markets in neighbouring areas. Many companies have already discovered our position and the assets Finland can offer. We welcome British companies and partners to study Finland as a base for their operations between the Baltic area, Northwestern Russia and the Nort Atlantic.

Over the last 50 years Europe and America have established an enduring relationship. It began during the Second World War and in the postwar period has faced many challenges. The Transatlantic relationship has brought security and stability to the nations in the area. There seems to be an increasing willingness to share these values within a wider Europe. We welcome discussion on strengthening the transatlantic relationship. Europe, once again facing new challenges, needs this discourse.

We believe that a North America/Europe Free trade area can be a possible goal for this cooperation in the future, but we still need some time for that development. In the shorter term we can see more pragmatic steps in this relationship, such as facilitating the operations of global companies.

Mr Chairman

We welcome new European stimuli for our economy. As our contribution, we are willing to bring our knowledge and experiences of our own region. This gives even further opportunities to expand the excellent economic and trade ties between Finland and Great Britain. I wish the Confederation of British Industries and its members every success in their endeavours.