In 2022, only a good half of the value of Finnish exports was transported by sea. The share of sea transport in exports is decreasing all the time, while the share of services is increasing. What will be the need for Finnish sea transport in the future, when the green transition can even make Finland a country with cheap energy?
According to the old saying, Finland is an island. And to confirm that, it is told how more than 90 percent of our exports are carried out by sea. In reality, the value of Finland’s goods exports in 2022 was 87 billion euros and the value of service exports was 32 billion euros – in other words, the share of services was 27 percent. The share of physically transported goods was only 73 percent of the value of our country’s exports.
It is remarkable that only 80 percent of the value of goods exports goes by sea – the rest goes by air or road, for example. In other words, less than 60 percent of our exports are transported by sea (55-58% depending on the statistical source), the rest is service exports and other forms of transport.
The share of services in exports has grown steadily. In 1985, the share of services in the value of exports was only 13 percent, and in 2013 it was already 24.5 percent. Among the services, the most significant are ICT services, business services (e.g. planning and consulting), transport services, tourism, royalties and licenses.
Figure 1. The value of Finnish export transport in 2022 – goods exports by transport mode (Source: Statistics Finland and Customs).
However, from the point of view of our national economy, exports alone are not significant, value addition is more important. That is, the money that is paid to us from abroad for the work done here. The larger the share of the product’s value increases in Finland, the more work and tax revenue it generates for us. VATT already estimated in 2017 that the share of services was more than a third of the domestic value added created by exports. The export of oil products produced the weakest value added.
What makes this matter interesting is the ongoing energy transition, as Finland is rapidly moving more and more to produce carbon-free energy, such as solar, wind and nuclear power. It is estimated that in a couple of years the total capacity of our wind turbines will double and even quintuple by 2030. Around the same time, Finland even becomes a net exporter of energy.
If this happens, the question arises, will the energy-intensive industry of industrialized countries move to Finland, or will energy be transported from here to Europe? From the point of view of our well-being, it would be important that the emerging green industry produces as much added value, work and tax revenue as possible in Finland – and not that energy is exported from us elsewhere. What kind of production would that value addition be, and will sea transport of products increase again in the 2030s?
Statistics Finland, foreign trade in goods and services.
Customs, ULJAS – transport statistics
VAT (2017). 100 years of a small open economy – the development, significance and outlook of Finland’s foreign trade.
The article was previously published in Finnish in the online magazine for maritime professionals navigatormagazine.fi on March 13, 2023.