Finland’s debt burden likely to grow by 2 bln euros in 2014

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Finland, one of the best credit keepers so far in the eurozone, will probably have its debt burden grow by 2 billion euros ($2.6 billion) in 2014, the state budget proposal showed on Wednesday.

According to theproposal completed by the Finnish finance ministry, the state budget for 2014 will be 53.9 billion euros, slightly less than that of 2013; the financial deficit will stand at 6.6 billion euros,down by 0.4 billion euros compared with 2013.

In addition, the central government's state debt will grow from 96 billion euros in 2013 to 98 billion euros in 2014, the Finnish Broadcasting Company YLE reported.

The proposal will be formally published on Thursday, before it will be discussed by the cabinet at the end of August. It will be submitted to the parliament in mid-September for final approval.

Public deficit seemed to be one of the major concerns of Finance Minister Jutta Urpilainen, who believed the country is facing three major challenges, namely the general economic downturn, exceptional structural transformations affecting industry, as well as public sector deficits.

Key measures have been taken to improve productivity and employment, underlined Urpilainen.

Opposition leaders did not reject the budget proposal, but insisted that more concrete measures should have been taken to rescue the country from economic recession.

Kimmo Tiilikainen, chairman of the Centre Party's parliamentary group, said that he would like to see more steps to improve employment and encourage business growth.

Meanwhile, Timo Soini, chairman of the Finns Party, threw doubt on the traditional model. He called for means to decrease labor costs for small companies and to encourage students to complete their degrees faster.

Finland's debt to GDP ratio was 53 percent in 2012, well under the EU threshold of 60 percent. Therefore, the rating agency Fitch Ratings affirmed in May that Finland kept its AAA credit rating.

Due to downward economic trend, however, some Finnish researchers warned that the present excellent credit rating may deteriorate sharply in a couple of years, if the increasing public debt can not be restrained. (1 euro = 1.33 US dollars)

Anthony-Claret Ifeanyi Onwutalobi

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Anthony-Claret Ifeanyi Onwutalobi

Anthony-Claret is a software Engineer, entrepreneur and the founder of Codewit INC. Mr. Claret publishes and manages the content on Codewit Word News website and associated websites. He's a writer, IT Expert, great administrator, technology enthusiast, social media lover and all around digital guy.
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