Finland is the Most Attractive Country in the EU for FDI

Finland tops the ranking of the most attractive EU countries for foreign direct investment.

Finland has ranked first in knowledge and innovation capacity from a recent study commissioned by the European Commission. The outcome illustrates efficient and strong collaboration among Finnish industries, research institutes, university centers of innovation and government delivering disruptive technologies and innovative design.

Finland has the most appealing political, regulatory and legal environment for foreign direct investment (FDI).  The report’s analysis point to this factor as crucial for decreasing the risks and costs of establishing and running a business in a country.

Finland was also noted as one EU country which has improved the most its cost competitiveness position due to an increase in its relative wage competitiveness combined with reductions in corporate tax rates.  It ranks highest in this factor in Scandinavia and significantly higher than Germany, Netherlands and Switzerland.

These results point to the reasons that many Fortune 500 companies see Finland as a new product innovation platform.

Recently, IBM and the Finnish Funding Agency for Technology and Innovation Tekes announced a strategic partnership to develop personalized medicine through its first Nordic Healthcare Competence Center, and the first National Imaging Center of Excellence outside the United States in Finland.

“The results reflect the fact that international companies enjoy a high return on investment in Finland. We have one of the lowest corporate tax rates – only 20 percent – in Europe and our workforce is highly educated and speaks fluent English. Setting up a business in Finland is quick and easy,” says Antti Aumo, Head of Invest in Finland at Finpro.

The FDI Attractiveness Scoreboard, used in the report, measured the relative FDI attractiveness of 44 countries by 18 key indicators in 2014 and 2009.

“In the construction of the index, we have focused on FDI drivers that policy makers can influence in the short to medium term and that can be integrated into their investment policies and strategies,” the report says.

The study was prepared by the Danish economic consultancy Copenhagen Economics for the European Commission’s Directorate-General for Internal Market, Industry, Entrepreneurship and SMEs.