In the latest report by Oxford Economics, it is highlighted that Finland can achieve long-term economic growth if it successfully meets its emission targets. The consulting company’s analysis shows that transitioning to clean energy could increase Finland’s gross domestic product by 4.5 percent by 2050 compared to a baseline scenario.
The report presents three scenarios from 2024 to 2050, comparing the economic impact of Finland’s green transition. In the climate leader scenario, Finland aims to achieve net zero emissions by 2035. This shift towards clean energy is expected to drive strong growth in the Finnish economy, with green investments supporting innovation, productivity, energy exports, and real incomes.
The report was prepared for Akava Works, a think tank associated with the Employees’ Association Akava. It was based on the latest academic research, interviews with Finnish experts, and modeling. While Finland’s current goal is to achieve carbon neutrality by 2035, additional measures may be required to reach this target as warned by the Ministry of the Environment in the latest annual climate report.
In the most optimistic scenario where Finland successfully achieves net zero emissions by 2035, it would lead to an average annual real GDP growth rate of 0.94 percent. This accelerated growth is attributed to increased investments in green energy production and associated benefits. However, if emissions are reduced at a slower pace, it would result in an average annual real GDP growth rate of 0.80 percent.
The report highlights that Finland’s transition to clean energy is critical for long-term economic growth. By remaining committed to its emission targets and fostering green investments, Finland can leverage its competitive advantages such as natural resources, a strong workforce and a history of climate policy leadership to drive sustainable economic development.
Accordingly, Finland must prioritize its efforts towards meeting its emission targets while also investing in green technologies and infrastructure to support long-term economic growth and prosperity for future generations.
