Finland

2012 Results



Aid

Aid quality is just as important as aid quantity, so the CDI measures gross aid as a share of GDP 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 well-governed recipients, and penalizes overloading poor governments with many small projects.


Finland’s aid performance

  • Score: 6.6
  • Rank: 8

Strengths

  • Large share of aid to poor and relatively well-governed recipients (selectivity rank: 6)
  • High net aid volume as a share of the economy (0.55%; rank: 7)

Weaknesses

  • Small amount of private charitable giving attributable to tax policy (rank by share of GDP: 19)
  • Moderate share of tied or partially tied aid (9.4%; rank: 12)

Trade

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’s trade performance

  • Score: 5.8
  • Rank: 7

Strengths

  • High level of manufactures imports from poorer countries (10.1% of GDP per capita; rank: 4)
  • Low agricultural subsidies (equivalent to a tariff worth 8.4% of the value of imports; rank: 7)
  • Low tariffs on textiles (6.4% of the value of imports; rank: 3)
  • Low tariffs on apparel (6.4% of the value of imports; rank: 3)

Investment

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’s investment performance

  • Score: 5.1
  • Rank: 15

Strengths

  • Employs foreign tax credits to prevent double taxation of corporate profits earned abroad
  • Active participation and leadership in extractive industries transparency initiatives such as the Extractive Industries Transparency Initiative (EITI) and the Kimberley Process on blood diamonds

Weaknesses

  • Political risk insurance agency does not screen projects for violations of local environmental rights
  • Imposes some restrictions on pension fund investments in emerging markets

Migration

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 home.


Finland’s migration performance

  • Score: 4.4
  • Rank: 17

Strengths

  • No tuition fee for foreign students

Weaknesses

  • Small number of immigrants from developing countries entering Finland (rank by share of population: 17)
  • 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)
  • Bears small share of the burden of refugees during humanitarian crises (rank: 14)

Environment

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’s environment performance

  • Score: 7.4
  • Rank: 3

Strengths

  • Low fossil fuel production per capita (0.0 tons of carbon dioxide equivalent; rank: 1)
  • Low consumption of ozone-depleting chemicals per capita (rank: 1)
  • GDP growth exceeded growth in greenhouse gas (GHG) emissions over the past decade (average annual growth rate/PPP GDP, –4.5%; rank: 3)

Weaknesses

  • High fishing subsidies (rank: 15)
  • Low gas taxes ($0.97 per liter; rank: 14)

Security

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’s security performance

  • Score: 6.6
  • Rank: 5

Strengths

  • Significant financial and personnel contributions to UN peacekeeping operations over last decade (rank by share of GDP: 5)

Weaknesses

  • Has not ratified the Convention on Cluster Munitions (CCM)
  • Significant level of arms exports to poor and undemocratic governments (rank by share of GDP: 12)

Technology

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’s technology performance

  • Score: 5.9
  • Rank: 6

Strengths

  • High government expenditure on R&D (rank by share of GDP: 1)
  • Provides patent exceptions for research purposes

Weaknesses

  • Low tax subsidy rate to businesses for R&D (rank: 21)
  • Significant share of government R&D expenditure on defense (rank by share of GDP: 15)