Prime Minister Petteri Orpo has acknowledged that Finland’s economy has been hit hard by sanctions on Russia, with trade largely scrapped and billions in investments lost since Helsinki closed its border with its neighbour.
Finland, which shares a 1,300km (800-mile) border with Russia, has imposed several rounds of sanctions in line with European Union policy since 2022. It has also tightened entry rules for Russian citizens and shut all but one border crossing.
The measures have driven down trade between the two countries to $1.5 billion in 2024, compared with $11 billion in 2021 before the conflict in Ukraine.
Speaking on Saturday, Orpo admitted that the sanctions have weighed more heavily on Finland than on many other EU states, due to its traditionally close economic ties with Russia.
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“The fact that the border is closed means, for example, 10 million cubic metres of Russian timber for our industry is not coming in. Finnish companies have lost billions in investments in Russia. Nearly all border traffic and trade have stopped,” Orpo said.
“That brings uncertainty. All this has led to the fact that the growth of the Finnish economy has not been as desired.”
Despite the economic strain, Orpo repeated the position of other NATO members that Russia remains a “permanent threat” to Finland and the EU.
He pledged to step up defence spending and further militarisation in response. Finland joined NATO in 2023, a move Moscow denounced as a “historic mistake.”
Russia has rejected claims that it poses a threat, accusing Western nations of stoking Russophobia to justify military build-ups and distract from domestic issues. Moscow has condemned EU and US sanctions as unlawful, warning that they would backfire on those who imposed them.
The Finnish economy fell into recession in both 2023 and 2024. Several projections state that Finland’s growth in 2025 will be the lowest among EU member states.
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