Translation


SPEECH BY PRESIDENT MARTTI AHTISAARI AT A LUNCHEON IN CONJUNCTION WITH A BUSINESS
SEMINAR IN ATHENS ON 15.9.1998

I appreciate the opportunity to address such distinguished representatives of business and industry in Finland and Greece. I hope this seminar will promote cooperation and other interaction between companies in our two countries.

When the work of developing the European Communities began after the second world war, the idea was to ensure the preservation of peace in our continent by closely dovetailing the economies of the European countries. Barriers to economic cooperation began to be dismantled with the aim of promoting economic growth and prosperity as well as political stability. Integration has served both goals well. Recent decades have been a period of uniquely positive economic and political development throughout the European Union.

Integration has brought countries that were earlier more distant from each other in the geographical sense - such as Finland and Greece - into a common framework for economic endeavour. The development of economic ties between EU member states now depends to a growing degree on the activeness and creativity of companies, on finding existing opportunities.

Trade and other economic relations between Finland and Greece have been developing positively. A surplus in Finland’s favour has been characteristic of our visible trade. Last year, the value of Finnish exports to Greece totalled 1.2 billion markkas or 67.8 billion drachmas, whilst our imports from Greece amounted to 400 million markkas or 22.6 billion drachmas.

A factor that substantially compensates for our trade surplus is, however, Greece’s great popularity with Finnish holidaymakers. For today’s Finns, Greece and especially her unique archipelago have become familiar, and for many of them near and dear. Greece has long been the Finns’ most popular holiday country in the Mediterranean region in summer - more than 130,000 of them came here last year. In numbers of visitors over the whole twelve months of the year, only Spain together with the Canary Islands ranks ahead of Greece as the Finns’ most important holiday destination in southern Europe.

As for travel in the other direction, it has been pleasing to note that thousands of Greeks have begun discovering Finland as a place to visit. Especially around Christmas and New Year, trips to exotic, snow-blanketed northern Finland, to Lapland, have been popular. I hope the Greeks will also discover our summertime, cultural Finland. I am certain that we can offer unique art and musical experiences to discerning visitors. I believe that the development of tourism links between our countries will make an effective contribution to strengthening a sense of European affinity among citizens.

Until quite recent years, Finnish exports to Greece consisted overwhelmingly of forest products. Now, however, the structure of our exports is diversifying, especially as high-technology products gain market share. This development corresponds to the overall pattern of our foreign trade, because high-technology articles have increased their share of our total exports to about a fifth. That growth is a result of our major inputs into research and development, which now amount to 2.6 per cent of our gross domestic product. That proportion is still rising and I believe that next year we shall reach about three per cent, which is close to the top of the world league.

We Finns, in turn, come to Greece to buy many of the products that our industry and consumers need, such as minerals, clothes and agricultural produce. On the whole, the structures of the Finnish and Greek economies and industrial sectors are largely complementary, which in my view creates interesting prospects for economic cooperation between us. I believe that the business seminar which has begun today will help to increase awareness of the new opportunities that exist for further developing our economic and trade relations. I would like to encourage Greek and Finnish companies to avail themselves of this unused potential.

Eleven members of the European Union, Finland among them, will enter the third stage of economic and monetary union at the beginning of next year. The European Central Bank will then begin practising a common monetary policy and the exchange rates of the currencies of the countries forming the euro area will be permanently pegged. From the economic perspective, the greatest achievement of European integration to date has undoubtedly been the creation of the Single Market. The euro area must be seen as a natural continuation of the Single Market’s development. The euro area and maintaining its stability are now just as important a basic value as the Single Market.

We in Finland have noted with great interest the determination with which Greece is striving to meet the preconditions for entry into economic and monetary union. The Greek economy has been developing favourably, and we hope that as soon as possible we shall see Greece as one of our partners in the euro area group of countries.

Our countries’ economies are developing positively. Both are growing at faster than the EU average. Economic growth in Finland has remained strong. Our aggregate output is forecast to grow by 5.5 per cent this year and 4 per cent in 1999. The unemployment rate, which has cast a shadow over our economy, is also forecast to fall to 10.5 per cent this year and 9 per cent next year. The Finnish economy’s prospects for next year are good. Our export competitiveness is excellent, household and corporate finances are in good shape, interest rates are low and so is inflation. It is obvious that favourable economic development both in Finland and in Greece improves our companies’ prospects of operating with success in both bilateral and third markets.

Finland is located in the stimulating economic environment that we call the New Northern Europe Business Area. This area comprises both our traditional Nordic trade partners and the new, developing markets of Russia and the Baltic States.

Russia’s economic difficulties are creating uncertainty. The global economy as a whole is likewise undergoing a disturbance in its growth. Yet the crisis in Russia did not come as a surprise. The changeover to a functioning market economy is more difficult there than in most of the other states of the former Soviet Union. Russia must be a more integrated part of the global economy. No one will benefit from isolating her.

All in all, our trade with Russia and the Baltic States has been developing strongly in recent years. Russia is now our fourth-biggest trade partner. Trade with Russia has been especially important for our small and medium enterprises. It is estimated that more than 2,000 Finnish companies are engaged in trade with our eastern neighbour. In trade with the Baltic States, Estonia has quite a central position and in fact Finland is that country’s most important foreign economic cooperation partner.

The Finnish business and industrial sectors have extensive experience of trade and other economic cooperation with Russia, a fact of significance in the present situation. The European Union is Russia’s main trade partner and, on the other hand, Russia will continue to be an important economic partner for Europe thanks to her vast energy and other natural resources. In this challenging environment, Finland offers Greek companies interesting options when they are considering operations or locating in this region - not just in Finland, but in northern Europe generally.

I wish the seminar participants the very best of success in your important work to cherish and further develop economic and trade relations between Finland and Greece. I propose that we raise our glasses in a toast to the good fortune and success of the Hellenic Republic, the excellent relations between Finland and Greece and to your health.