Finland is proud of its role as a pioneer in the various fields of modern technology. Research projects are supported in order to encourage development of internationally competitive products, production processes or services. The National Technology Agency (Tekes) provides grants and risk loans to such projects. The amount of support is dependent on the nature of the project and the size of the enterprise involved.

Even for major enterprises engaging in projects in metropolitan areas, state support can cover a considerable proportion of the costs for wages and salaries, raw materials, machinery, subcontracting, travel and patents. When smaller enterprises are involved, support may exceed 50% of the costs.

In view of the eminently high level of vocational education in Finland, qualified employees for research and development are usually available. The good investment climate in Finland is supplemented by existing ‘know-how clusters’. This is the case, for example, in the sectors of communication technologies, medical diagnosis technology, and the wood-processing industry. Therefore, product development in Finland may be a good solution for many foreign enterprises.

The objective of other incentives for investments is to promote small and medium-sized enterprises (defined as those having fewer than 250 employees and a turnover not exceeding €40 million) and/or structural adjustment areas. If the primary goal of a foreign enterprise intending to invest in Finland is market development, the first investment must usually be made in one of the economically strong conurbations where the market is situated. In such areas, government or regional aid is available only in exceptional cases. The most interesting programme among the incentives available for investments in conurbations, namely the incentives for investment in research and development, has been described above.

Besides market development, there are further reasons to invest in Finland. These are partly sector-specific and partly of a general character:

Investment in material assets is the focal point for business aid in structural adjustment areas. The grants are usually calculated as a certain percentage of the total investments made in material assets. Where foreign enterprises qualify for government grants and make large investments in material assets, considerable grants are available even though the effect on the labour market is small. This point is of interest to enterprises operating in economic sectors which have a great need for fixed assets.

For internationalisation (export promotion), government grants are available even for investments other than in material assets. However, no internationalisation aid is available to the foreign investor. Foreign enterprises can obtain such aid only in the exceptional case that a Finnish subsidiary is used to further develop markets such as Sweden, Russia or the Baltic countries.

Further information is available from various Finnish organisations. We would be pleased to arrange for you to get in touch with them.