每日英語跟讀 Ep.922: Finland Has Faith In the Euro
Finland is, in many ways, the anti-Greece.
Like Greece, it is geographically far from the core Western European powers of Britain, France and Germany. And like Greece, it uses the euro currency. But unlike Greece, it is a model of sound governance and responsible use of debt.
Yet Finland’s economy is also not doing so great, with an 11.8 percent unemployment rate and with contracting gross domestic product in the last three years.
A number of American commentators have looked at Finland’s current economic troubles as a clear sign that what ails the eurozone is far deeper than profligate spending by the Greeks. Paul Krugman has made that case at The New York Times, Tim Worstall at Forbes and Matt O’Brien at The Washington Post.
Alexander Stubb, the Finnish finance minister, thinks they’re wrong. I brought this up with him recently in Espoo, the Helsinki suburb where he lives. His vigorously defense what the euro has done for Finland, and his comments help explain why elite opinion about the euro is so different on the two sides of the Atlantic.
There are three main causes of Finland’s economic weakness. Nokia has gone from the world’s largest mobile phone maker to an afterthought, costing thousands of Finnish jobs and many more when its supply network is counted. Demand for paper, another major export, has fallen. And the economy of neighboring Russia, with which Finland has deep trade ties, has collapsed because of plummeting oil prices and Western sanctions.
Because Finland has used the euro since its inception, the value of its currency cannot adjust in ways that would cushion the overall Finnish economy from those shocks. If Finland still had its old currency, the markka, it would have fallen in value on international markets. Suddenly other Finnish industries would have had a huge cost advantage over, say, German competitors, and they would have grown and created the jobs to help make up for those lost because of Nokia and the paper industry and Russian trade.
“Rubbish,” Mr. Stubb said. To evaluate the euro, you can’t just look at what he calls a current “rough patch” for the Finnish economy. You have to look at a longer time horizon. In his telling, the integration with Western Europe – of which the euro currency is a crucial element – deepened trade and diplomatic relations, making Finland both more powerful on the world stage and its industries better connected to the rest of the global economy. That made its people richer.
“In the early 1990s in the middle of a Finnish banking crisis and economic depression, we were a top 30 country in the world in per capita G.D.P.,” he said. “Then we opened up; we became members of the E.U. Now we’re always up there in G.D.P. per capita or whatever other measure you look at with Sweden, Denmark, Australia and Canada.”
As to whether the ability to devalue its currency would help deal with the current economic downturn, Mr. Stubb is similarly skeptical.
“Devaluation is a little like doping in sports,” he said. “It gives you perhaps a short-term boost, but in the long run, it’s not beneficial. Just like anyone else, we need structural reform, structural adjustment; we need to increase our competitiveness, and a little bit of luck.”
Source article: https://paper.udn.com/udnpaper/POH0067/283515/web/