Sustained efforts needed to turn Finland’s public debt ratio around : assessment of public finances 2024

Abstract

The state of the public finances in Finland remains challenging. The economy’s persistently weak productivity growth and the repeated economic shocks have together eroded the tax base, and expenditure growth has exceeded growth in revenue. Public debt relative to gross domestic product (GDP) has grown over the past decade to reach record highs. Turning the debt ratio onto a declining path will require sustained fiscal consolidation measures for some time to come. The EU’s new fiscal rules provide a framework for reducing government debt ratios.