IBM and EY have published their latest reports. They both are strengthening previous surveys: Finland offers an excellent business environment for industries that require skilled labor and are based on high-value jobs.
Finland and Helsinki leading the Nordics
According to the recent EY Attractiveness Survey, Finland attracted again most foreign investments in the Nordics. Finland has kept the leading position now for seven years in a row. The most attractive industries in Finland were ICT, Health and consulting services. “The strength of Finland is versatility among other things. Finland has been able to attract investment to several sectors”, the CEO of EY Finland Mikko Äijälä comments on the press release of EY.
When the survey compared Nordic cities, Helsinki was clearly number one with its’ 95 investment projects. For instance Stockholm had 33 and Copenhagen 32 projects last year. Also Espoo (17) and Vantaa (11) attracted significant amount of projects. So the whole Greater Helsinki had total number of 123 investment projects last year. Few of the assets in Greater Helsinki, according to Mikko Äijälä, are the start-up friendliness and atmosphere that supports innovation. These create an attractive business environment for many foreign companies.
Talent as one of the keys for R&D investments
IBM Global Location Trends report presents and analyzes the latest developments in corporate location selection around the world. Finland and Greater Helsinki were in the TOP 5 destinations when the survey compared the average project value based on the value of jobs. This supports other surveys and reports that Greater Helsinki is very competitive globally when it comes to the high-value industries.
One sector where Helsinki outperforms year after year is ICT and tech and no wonder. According to an external survey ordered by Helsinki Business Hub and Business Finland, Finland has significant skills resources across all technical skills areas. Only Greater Helsinki has 83 000 IT professional and when commuters are added, the number of experts rises to 152 000. The survey also points out that Finland stands out with interdisciplinary skills. A high percentage of the workforce has other technical skills experience too. In addition to ICT, Finland has a significant talent pool in engineering, health tech, cleantech, and financial services.
The political and economic uncertainty affected the investments
The Global Location Trends report and EY Attractiveness Survey both collect also general trends related to investments. According to the Global Location Trend report, foreign investment activity continued to decline in 2018. The report revealed that the number of projects decreased by 3 percent and the expected job creation decreased by 9 %. Partly the reason, according to the report, is the uncertainty surrounding, potential trade wars and regional or local disruptive events such as Brexit. But the report also reminded that the investments have followed a period of growth with a peak in 2016. The lower levels of investment in 2018 may also be partly due to saturation.
EY Survey had similar observations, that the economic and political uncertainty was visible in the investments. Their survey dived into different continents too. FDI into Europe declined in 2018, although Europe was doing quite well compared to other regions. According to EY survey, Western Europe is considered more attractive than at any point in the last ten years as a place to establish operations.
Differences between regions
IBM Report revealed that US was still the top location for FDI even the decline was visible also there. China’s investments were increasing still. China went ahead of Japan for the first time and was the main Asian outward investor.
The effect of Brexit was visible in the investments and the UK was losing market share from the previous years. This meant the London lost its’ first place as Paris attracted the most investment projects, according to the IBM report. Although EY pointed out that also Paris was losing its shine. According to EY competition between European cities for investment has never been more equal, or intense. Global companies are looking for locations where businesses, policymakers, universities, and the financial community have created effective business ecosystems.