Ideas to Action:

Independent research for global prosperity

Finland

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2006 Results

Aid

What it measures

Aid quality is just as important as aid quantity, so the CDI measures gross aid as a share of GNI adjusted for various quality factors: it subtracts debt service, penalizes “tied” aid that makes recipients spend aid only on donor goods and services, rewards aid to poor but relatively uncorrupt recipients, and penalizes overloading poor governments with many small projects.

Finland Overall
  • Score: 3.9
  • Rank: 10
Finland Strengths
  • High net aid volume as a share of the economy (0.40%; rank: 7)
Finland Weaknesses
  • Small amount of private charitable giving attributable to tax policy (rank by share of GNI: 18)
  • Large share of tied or partially tied aid (14%; rank: 13)



Trade

What it measures

International trade has been a force for economic development for centuries. The CDI measures trade barriers in rich countries against exports from developing countries.

Finland Overall
  • Score: 6.1
  • Rank: 6
Finland Strengths
  • Low barriers against textiles (rank: 3)
  • Low barriers against apparel (rank: 3)
Finland Weaknesses
  • High protection of agricultural commodities (rank: 14)



Investment

What it measures

Rich-country investment in poorer countries can transfer technologies, upgrade management and create jobs. The CDI includes a checklist of policies that support healthy investment in developing countries.

Finland Overall
  • Score: 6.2
  • Rank: 11
Finland Strengths
  • Participates in the Extractive Industries Transparency Initiative (EITI) and the Kimberley Initiative on blood diamonds
  • Provides official support for design of securities regulations and institutions in developing countries
Finland Weaknesses
  • Does not screen projects for social impacts through national political risk agency
  • High bar for tax-sparing arrangements to prevent double taxation of corporate profits earned abroad
  • Imposes restrictions on pension fund investments in emerging markets



Migration

What it measures

The movement of people from poor to rich countries provides unskilled immigrants with jobs, income and knowledge. This increases the flow of money sent home by migrants abroad and the transfer of skills when the migrants return.

Finland Overall
  • Score: 2.7
  • Rank: 15
Finland Strengths
  • No tution fee for foreign students
Finland Weaknesses
  • Only a small increase during the 1990s in the number of unskilled immigrants from developing countries living in Finland (rank by share of population: 15)
  • Small number of immigrants from developing countries entering Finland in 2004 (rank by share of population: 20)
  • Bears small share of the burden of refugees during humanitarian crises (rank: 14)



Environment

What it measures

Rich countries use a disproportionate amount of scarce resources, and poor countries are most vulnerable to global warming and ecological deterioration, so the CDI measures the impact of policies on the global climate, fisheries and biodiversity.

Finland Overall
  • Score: 6.7
  • Rank: 5
Finland Strengths
  • Few imports of endangered species (rank: 3)
  • Large decline in greenhouse gas emissions rate in 1994–2004 (average annual growth rate/PPP GDP, –2.6%; rank: 6)
  • High gas taxes (rank: 8)
Finland Weaknesses
  • High greenhouse gas emissions rate per capita (16.5 tons of carbon dioxide equivalent; rank: 16)



Security

What it measures

Since security is a prerequisite for development, the CDI rewards contributions to internationally sanctioned peacekeeping operations and forcible humanitarian interventions, rewards military protection of global sea lanes, and penalizes arms exports to poor and undemocratic governments.

Finland Overall
  • Score: 6.3
  • Rank: 5
Finland Strengths
  • Significant financial and personnel contributions to internationally sanctioned peacekeeping and humanitarian interventions (overall contribution rank over last 10 years by share of GDP: 6)
  • Few arms exports to poor and undemocratic governments
Finland Weaknesses
  • No protection of global sea lanes



Technology

What it measures

Rich countries contribute to development through the creation and dissemination of new technologies. The CDI captures this by measuring government support for R&D and penalizing strong intellectual property rights regimes that limit the dissemination of new technologies to poor countries.

Finland Overall

  • Score: 6.3
  • Rank: 3
Finland Strengths
  • High government expenditure on R&D (rank by share of GDP: 1)
  • Low share of government R&D expenditure on defense (1.6%; rank: 9)
Finland Weaknesses
  • Low tax subsidy rate to businesses for R&D (-1%; rank: 17)