Foreign companies in Finland grow faster than Finnish-owned companies

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Foreign-owned companies set up in Finland tend to see more growth in personnel and turnover than domestic companies do. A recent study shows that growth in personnel at least during the first years of operation was 13 to 15 percentage points higher than Finnish-owned enterprises.
      Growth in turnover is an average 10 - 12 percentage points higher. However, there is great variation.
     
A study on the impact of foreign ownership, conducted by the Research Institute of the Finnish Economy (ETLA), reveals that growth is rapid primarily in newly-established enterprises.
      In companies that have been sold by a Finnish owner to foreign ownership, increases in the number of personnel are similar to those of other companies, but growth in turnover is more rapid than in companies whose ownership arrangements are unchanged. However, the difference disappears if they are compared with companies shifting from one Finnish owner to another.
      ETLA researcher Jyrki Ali-Yrkkö says that the study does not support the view that companies would be more eager to close down operations in Finland than in other countries.
      ETLA studied the impact of foreign ownership at the request of the Invest in Finland Bureau (IIF), which is dedicated to attracting international investment to this country.
     
For its study, ETLA examined 760 companies that were set up in Finland in 2001-2003. ETLA followed up on the companies through 2005. Sixty per cent of the firms in question were existing companies that were bought in Finland, and the rest were newly-established.
      Companies set up by foreign owners focused heavily on services - mainly commerce, but they also included services for business. Only a few were involved in industrial production.
      ETLA attributes the faster growth of foreign-owned companies to the fact that international companies tend to have greater financial resources than private Finnish owners.


Previously in HS International Edition:
  Invest in Finland (IIF)

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