Case Study – FINLAND
Programming for the Green Economy
Introduction 1. Equal prospects for wellbeing
Finland has a 2. A participatory society for all
population of 5.4 3. Work in a sustainable way
million, of which 30% 4. Sustainable society and local communities
live in rural areas, and 5. A carbon-neutral society
an area of 390 903 6. A resource-wise economy
km2, of which 86% is 7. Lifestyles respectful of the carrying capacity of
forest and only 7.6% is nature
farmland – Finland has 8. Decision-making respectful of nature
the most northerly
agricultural land in the Progress will be monitored and reviewed with the use of
EU. 39 national sustainable development indicators
About 42% of all enterprises operating in Finland are identified in 2014. The idea is that the indicators will be
located in rural areas, and in 2010 about 93% of revised and updated as needed for the follow-up to
enterprises were defined as ‘micro sized’, employing Agenda 2030 and thus will also complement the global
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fewer than 10 people. sustainable development indicators .
The forest sector is a major contributor to the rural
The Finland RDP 2014-20
economy and accounts for 20% of all Finland’s exports.
More than three-quarters of the home-grown wood Finland does not use forestry measures within its
processed by the forest industry comes from privately RDP. The objectives for the agriculture sector
owned forests. Traditionally farms have also had forests, include diversification of agriculture-related
which provide important additional income often used businesses, promoting food chain organisation
to finance farm investments. Family farms, as well as (including processing and marketing of agricultural
other private forest owners, also make an important products), and improving animal welfare. The RDP
contribution to the Finnish economy through forest measure supporting farming in areas with natural
management, and forests are an important source of constraints accounts for €3.7 billion or 45% of the
biomass for energy. It is expected that innovations in the RDP planned public expenditure, which will be
bio economy field will boost sustainable development, topped up by additional national financing worth
employment and competitiveness in the rural areas.in almost €2 billion. New types of enterprise will be
the rural areas. promoted in sparsely populated areas and more
local, neighbourhood-oriented action will be
encouraged.
Policy Framework and background
The agri-environment-climate measure is allocated
In April 2016 the Finnish National Commission on 19% of the RDP planned public expenditure, with
Sustainable Development published a strategic two main objectives:
framework The Finland We Want by 2050 – Society’s
• to maintain and develop valuable open, arable
Commitment to Sustainable Development which1
landscape and natural meadows and pastures,
identifies eight objectives for sustainable development:
used for food production, renewable energy, or
simply managed to maintain their open
character;
• to reduce the harmful environmental impacts of
1
http://kestavakehitys.fi/documents/2167391/2186383/FINAL+Kestävän+kehityksen+yht agricultural activities on the soil, surface and
eiskuntasitoumus+20+4+2016_eng-GBs_Final+-
+kielenhuolto_EN_rev+%282%29.pdf/e057e638-507e-464c-a3dd-d3f0826f8950
ground water and air by promoting the use of
2 http://www.sd-
environmentally-friendly practices.
network.eu/?k=country%20profiles&s=single%20country%20profile&country=Finland
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Programming for the Green Economy
More than 81% of agricultural land is expected to The report points out that policy coherence is needed in
come under management contracts to improve order to provide consistent regulation and guidance, and
water management. that promoting the green economy requires extensive
cooperation between different stakeholders and policy
The RDP aims to raise awareness of environmental sectors. It goes on to recommend that systematic
issues as well as energy and resource efficiency, and ecosystem services assessments should become an
to increase the share of renewable energy, and to integral part of ‘greener’ decision and policy making
make more efficient and sustainable use of manure. within different economic sectors in the future.
The graphics illustrate the EU priorities, measures
and budget allocations of the Finland RDP 2014-20. Water quality is one example where a coherent cross-
sectoral approach could provide economic benefits and
Table 1: Budget allocation per RDP Priority
improve ecosystem services. Pollution from agricultural
fertilizer run-off and effluent from waste water treatment
works is a significant problem in Finland, for both inland
waters and the rivers draining into the Baltic. The diagram
below illustrates how a coherent approach to
sustainability across different economic sectors could
improve water quality in Finland (the contribution of
mussel farming to water quality is that mussels remove
excess nitrogen and phosphates from the nutrient-rich
water, and in doing so grow bigger).
Source: RDP Summaries, ENRD, 2016
Table 2: Budget allocation per RDP Measure
Million EUR
Source: Jäppinen, J.-P. & Heliölä, J. (eds.), 2015.
Source: RDP Summaries, ENRD, 2016
Co-operating for Sustainable Management
at a local level
Finnish agriculture is still based mainly on relatively small
The potential for efficient use of natural family farms, with an average size of 36 hectares.
resources to provide ecosystem services Productivity is limited by the natural constraints of a short
growing season, long cold winters and poor soils, and
A report published in 2015 by the Finnish Ministry of
average yields of arable farms are low by European
Environment highlights that ecosystem services are an
standards.
integral part of several economic sectors relevant to green
economy in Finland. These include the forest sector, Livestock have a limited pasturing season and the costs of
water, tourism, agriculture and food, game and fisheries, winter housing are high with the need for heating and
and renewable energy. Ecosystem services are also insulation, plus storage of winter feed.
perceived as an integral part of growing green economy Fragmentation of agricultural land parcels by the
sectors such as the textile industry, life and health style numerous lakes and forests causes extra costs and makes
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businesses, cosmetics and pharmaceuticals . it difficult to increase farm size and profitability.
3 Jäppinen, J.-P. & Heliölä, J. (eds.) 2015: Towards a sustainable and genuinely green
economy. The value and social significance of ecosystem services in Finland (TEEB for
Finland). Synthesis and roadmap. The Finnish Environment 1en/2015. The Finnish
Ministry of Environment, Helsinki. 144 p.
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http://www.ieep.eu/assets/1670/Jappinen_Heliola_eds_2015_TEEB_Finland.pdf
Programming for the Green Economy
Most family farms are already involved in forestry as well Agricultural land accounts for only 7.6% of the
as farming, and diversified farming is becoming more territory and is almost entirely under arable
popular. More than 30 per cent of farms have other crops, with livestock housed for much of the
gainful activities in addition to agriculture. year. Family farms typically have both agricultural
The green economy offers opportunities for farms to land and forest, and 30% have other sources of
create new kinds of jobs and businesses in the rural areas. income too.
For example, supplying local customers with energy Nearly half the RDP budget (plus additional
produced from wood-fuel, and providing tourism services national financing) is used to support farming in
in rural areas close to cities or ski resorts. Cooperation is areas affected by natural constraints; other RDP
traditionally strong in the rural areas of Finland and measures are targeted at local action in sparsely
networks among local entrepreneurs can be of mutual populated rural areas.
benefit to different businesses, for example between a
food producer and a tourism provider. Finland has a vision of how its society will be fully
committed to sustainable development by 2050,
The diagram below illustrates how different types of rural
and progress towards achieving the eight
businesses and services might interact in a thriving rural
sustainable development objectives will be
areas, but it shows also the difficulties posed by
measured regularly.
fragmented land parcels and ownerships (the white lines).
There are opportunities to move towards a
sustainable green economy through coherent,
cross-sectoral polices for the improvement of
Key Points ecosystem services, for example in water quality
The natural constraints of climate and soils in the Cooperation is a long-standing tradition in rural
far north of Europe shape the rural economy of areas and there are opportunities for new links
Finland, in which forestry plays a major part. between different types of rural businesses
Most rural businesses are small, employing less within a locality, but also considerable
than 10 people. challenges, not least that of fragmented farm
holdings and land ownership.
Challenges when many landowners and stakeholders:
Tools and carrots needed for cooperation!
Graphics: Kuke Oy
