VATT Data Room: Russian invasion of Ukraine has had only minor economic effects on Finnish firms that used to trade with Russia
The total exports and imports of the Finnish firms that used to trade in goods with Russia decreased almost immediately after the Russian invasion of Ukraine in February 2022, but the overall economic effects of the war on these companies have remained small.
These are the major findings on a newly released VATT Data Room’s report: Russian Invasion of Ukraine: Effect on Finnish Companies Trading with Russia.
The Finnish firms that used to export to Russia have seen their total exports decrease moderately because of the war but their total sales and employment have been unaffected. The firms that used to import from Russia have experienced more difficulties, with both their turnover and total imports declining compared to other importers. Still, they have not needed to downsize their workforce. Despite a collapse in the trade between Finland and Russia, the overall economic effects of the war on Finnish firms that used to trade with the country have been small.
“Russian markets have probably been of a relatively small importance for the Finnish firms, or they have been able to replace trade with Russia by other markets”, says one of the authors of the report, researcher Max Toikka from VATT Data Room:
“The war has mostly affected firms that used to import from Russia – and among them, those that have been highly dependent on trade with Russia. These companies took large business risks, which have now been realized”, says Max Toikka.
The report asserts that state subsidies for Finnish firms engaged in trade with Russia are unnecessary.
“Based on our findings, there is no need to subsidize the firms that used to trade with Russia because the economic effects of the war on them have been only moderate, on average”, says Max Toikka.
This is the first VATT Data Room’s report available in English.
Read the report in full!