Would Finland be better off without euro?

New Year’s Day is always special, but for Finland in 2002, the day was very, very special. In the afternoon, I walked across Esplanade Park in Helsinki heading to a restaurant and stopped by on an ATM to withdraw money.

The cash machine did not give me Finnish marks, as it would have done the day before, but pumped out euro notes.

My home country had a new currency. I was holding my first euros in my hands.

euro markka

Euro had come into existence virtually on January 1, 1999, and now, two years later, notes and coins started to circulate. Eleven EU countries took part in common currency’s first phase, and Finland was one of them – alone in Northern Europe.

I was an undergraduate student and did not have much on my bank account but I was thrilled about the euro. I no longer needed to exchange money when travelling to Central Europe. I bemoaned euro hadn’t been there already year before when I spent an exchange semester in a journalism school in Brussels.

I thought my Swedish and Danish friends were so unlucky not to be part of the joy. Their countrymen had rejected euro membership in referendums and they still had their boring crones.

I considered very carefully how much Finnish marks I would save for the future as a reminder of the “old times”. People said that some day marks could be considered rare items of collection. Would I want to give marks to my children some day?

The dual circulation period lasted two months, and at the end of February 2002, I put some mark notes and coins to an envelope. Shops no longer accepted them. I solemnly thought they were for the future generations.


I couldn’t have guessed that just 15 years later there would be serious talks about getting marks back as our currency, as soon as possible.

No one is celebrating euro anymore. It is now the common currency in 19 out of 28 EU countries and used by nearly 340 million people every day – and it has become a synonym of a crisis.

In 2015, Finland’s economy is in recession nearly for the fourth consecutive year, and many blame euro.

The former Minister of Foreign Affairs, Paavo Väyrynen, is one of the loudest critics. Last summer the stubborn old statesman started collecting signatures for a petition to get Finland’s departure of euro membership before the Finnish parliament.

I have no idea where my envelope of old Finnish marks has gotten. Should I start looking for it?

Could I possibly use them one day?


Paavo Väyrynen, at present a member of the European parliament, says that with the petition he is doing what is necessary. With its own currency, Finland could reign its own monetary policy and devalue.

Finns remember what devaluation means, as it solved the country’s most severe peacetime crisis in 1993. Economy overheated largely due to a change in the banking laws in 1986.

Eventually Finland let mark float and adjustment mechanisms worked. More competitive exchange rates enabled the country sell its products at a cheaper price.

Väyrynen was elected into Finnish parliament for the first time in 1970, and he’s served in eight cabinet of ministers of Finland. He’s now got over 50,000 signatures on the petition which means Finnish parliament might to have a look at the issue. Väyrynen wants the parliament to debate whether the country should exit eurozone and to enact a law that would make “Fixit” – Finland’s euro exit – possible.

In his opinion, the elite of the country cannot admit they made a mistake.

”Elite does not want this topic even to be discussed,” Väyrynen wrote me.

I asked him why did he decide to collect signatures – and what are his party colleagues thinking of it. Väyrynen’s party Keskusta – The Center – is Finland’s prime minister party at the very moment, and Prime Minister Juha Sipilä is not criticizing euro at all – on the contrary.

Väyrynen answered me saying he is sure his petition will proceed into the parliament and as he no longer has official status in Finland he feels the petition is justified as a method of exercise of power.

Väyrynen has objected euro and Finland entering the eurozone from the beginning. His party was eurosceptic but as soon as it won the election last spring, the ones in power have committed themselves to the common currency. The official stand is that euro brings “stability”.

Väyrynen says that half of his party does not believe in that but the others remain silent.


On December 10, 2015, the governor of the Bank of Finland, Erkki Liikanen, held a press conference about the economic situation of Finland. I watched it online (here: http://cloud.magneetto.com/suomenpankki/2015_1210_liikanen/angular). It was a very monotonous talk for which Liikanen had given a very dry and long title. The translation into English would be something like: “About economics, monetary policy and financial stability in Finland. Ten year’s economic development 2007-2017 from five different perspectives.”

I was anyway curious to find out what Liikanen’s five perspectives were, as other experts seemed to have just one viewpoint. The economy of Finland is miserable, no matter where you look at it.

In the third quarter of this year, Finland’s economy contracted by 0.6 percent. Odds are that this year will end up being the country’s fourth consecutive year of recession.

There are – for now – some nice numbers and qualifications related to Finnish economy: rating AAA- of sovereign debt. Quite moderate 62 percent government debt-to-GDP ratio. Ranking among the top ten most competitive economies in the world by the World Economic Forum.

But these don’t seem to help (and the last one, in my opinion, has to be a miscalculation).

Finland’s debt-to-GDP ratio is now nine percent bigger than in 2007. The Bank of Finland estimates it to grow from present 62 percent to 68 percent by 2017.

Between 2008 and 2014 Finnish exports shrunk by 12 percent.

This is why country’s Prime Minister Sipilä’s goal is to bring about internal devaluation as quickly as possible. The former businessman has been in power since the spring 2015 and has shaken the Finnish political culture. He is ruling like a CEO, not like a negotiator. He is determined to get the labor costs down in spite of the trade unions’ strong objection.

He believes in austerity, as does the governor of the Bank of Finland Erkki Liikanen.


In the press conference Liikanen offered five familiar explanations to Finland’s state, no fresh viewpoints.

Finland’s overall production is in a downturn because both productivity and the amount of workers are decreasing.

The age structure of Finland is a disaster. According to the Bank of Finland’s estimate, in 2017, there will be 200,000 more pensioners, 50,000 more unemployed, 5,000 more under 15-year-olds and 50,000 less workers than in 2007.

In the third quarter of 2015, the value of exports was 19 percent smaller than in the second quarter of 2008, which was the best economic quarter of 2000s in Finland. ”No other developed country has seen this big decline in exports during these years,” Liikanen said and reminded us that Finland’s eastern neighbor Russia, the main export market, is in a ”deteriorating economic state”.

Bank of Finland estimates that between 2007 and 2017 the debt to GDP ratio will raise from 53 percent to 68 percent. The same time the deficit in the whole eurozone is about to decrease by two percent in the average.

Because pensioners and unemployed now bring more costs, the government of Finland has less to spend on other areas. In 2007, money spent on pensions was 29 percent of country’s budget. In 2017, it will be 32 percent.


”Actions are necessary,” Liikanen said in the end, not surprisingly.

Necessary actions, according to Liikanen, include improving cost competitiveness and restructuring the pension system and social security system. People should a have more active work years in their lives, he continued.

”Electronic and forest industry are highly cost competitive areas of business.”

Electronic industry have suffered from Nokia’s collapse. It used to be the biggest employer of Finland and played a major role in exports. Forest industry is still the basis of Finland’s exports. But:

”Salaries have risen more than in the eurozone on average, and at the same time, Finnish companies’ ability to pay salaries have gotten worse. Companies must be able to offer their products overseas with competitive prices,” Liikanen said in his laconic style.

He added that Finland needs less regulation and more competition. He undoubtedly meant that trade unions have too much much power. Finland is ranked 103rd out of 144 countries for labor flexibility in 2015 by the World Economic Forum.

”When there are new entrepreneurs, there is more competition and thus more innovations,” Liikanen said.


As the Governor of the Bank of Finland Liikanen is also a member of the Governing Council of the European Central Bank and a Governor of the International Monetary Fund for Finland.

He has strong ties to European Union’s institutions. In 1990, he became the first Finnish ambassador to the European Union and in 1994 he became the first Finnish Member of the European Commission. He was Commissioner for Budget, Personnel and Administration.

I wouldn’t expect him to critisize euro. But I would have expected him to talk more about ECB:s monetary policy.

All he said was: ”Monetary policy is already supporting the recovery of national economics but as the interest rates are low, we must take care that negative side effects do not occur. So macroeconomical stability policy is needed.”

Liikanen pointed out that statistics show that Finland has used more mechanisms of finance policy than any other country in eurozone to help its’ economy to recover.

He rejected stimulation by saying:” Because Finland’s problems lie in exports, stimulation is not an answer. The biggest losses are in the industry, whereas the service sector has grown. This is why raising the internal demand by stimulus is not a solution. However, public investments that are likely to accelerate private investments are to be implemented.”

Finland’s largest sector of the economy is services at 65.7 percent. Manufacturing and refining together make up 31.4 percent. Primary production is 2.9 percent.


Journalist Simon Nixon sounded just like the Finnish government on November 25, 2015, when he wrote on Wall Street Journal that “Finland’s Problem Isn’t the Euro”.

”It is easy to exaggerate the role devaluation played in the British and Swedish recoveries”, Nixon wrote.

Sweden has cut its public spending from over 60 percent of GDP in the mid-1990s to just over 50 percent now. Finland’s public spending is at present 59 percent of GDP.

Finland’s working-age population economically active is five percentage points below that in Sweden — “a serious problem for a country whose workforce is already shrinking as a result of having the worst demographic profile in the EU,” Nixon compared.

He reminded his readers that ”two of the fastest-growing economies in the EU now are Ireland and Spain, both of which are in the eurozone.”

And that Finland has benefited from unprecedentedly low funding costs since the start of the euro crisis. ”That reflects Finland’s high levels of fiscal credibility, based on its low debt and deficits and its commitment to complying with the eurozone’s fiscal rules.”

Helena Yli-Renko, Assistant Professor of Clinical Entrepreneurship at University of California, also emphasizes the positive effects euro has had. Common currency has helped Finnish companies to grow global, she said to me. ”Common currency has been a way of simplifying processes.”


Opinions about euro are many and mixed so I asked even more of them.

Unto Hämäläinen is eminent political commentator in Finland and senior editor of the leading newspaper Helsingin Sanomat. He pointed out that, first of all, Paavo Väyrynen has revenge going on with his petition.

Väyrynen is bitter of not getting minister’s post after this year’s elections, after which he decided to stay in The European Parliament and get back at the party’s leader, Prime Minister Sipilä. Väyrynen is an attention seeker, Hämäläinen said.

Hämäläinen in convinced that Fixit won’t happen and is not even discussed about because the two parties that were originally against euro are now the two ruling parties of Finland. In Finnish parliament, there is no party that would support Fixit.

Another journalist, prominent economic writer Paavo J. Teittinen says that he believes Finland would be better off without euro. He himself supports Fixit, but he does not believe mark will ever come back. In Teittinen’s opinion, it’s ridiculous that Finnish politicians blame other countries for not following the euro regulations because the biggest problem in euro is the regulations themselves. Currency it’s not planned well at all.

Euro was just a mission of peace in Europe.

It allowed Finland to position itself in the core of Europe and away from the unpredictable Russia.

Ove the years the ones who have been against euro are the ”foolish conservatives” or the ”provincialists”. The populist right-wing party Perussuomalaiset had the departure of euro in their agenda – until they became a governing party.

Many others are just unrationally attached to euro.



Teittinen hopes that the possibility of the exit would anyway be studied thoroughly and discussed seriously.

We do not want to be in a situation where we face more troubles and ask ourselves silently if they are due to a malfunctioning currency.

I agree.

I will not climb to the attic to look for my envelope full of Finnish marks. Not yet.


Sources also: The Wall Street Journal

Bank of Finland

Helsingin Sanomat

The World Economic Forum.

Sauna business, hot business

vanha sauna

Many people in the U.S. can say one word of Finnish without knowing it. They can say sauna. Some of them – I believe – even have some kind of an image what sauna is.

Some few have experienced it.
Sauna is an old Finnish word, and it is ancient old tradition in Finland. The word refers to the old way of bathing in this cold country, and it refers to the bathing house – a steam room that is heated up of with a special kind of stove, kiuas.
Ages ago saunas were considered sacred places in Finland. Women gave birth to their children in saunas – as they were not only sacred but also clean and warm places even in the midst of cold winter. There are many superstitions and old rituals related to bathing in sauna.
Still today, saunas are so important to Finns that nearly every apartment building in the country includes a common sauna for its habitants. In addition to that, quite many people have a tiny sauna in their apartment.
Houses are sure to have a sauna room – it would be considered odd if a new house built in Finland did not include a sauna.
In the cities, saunas have electric heating systems but in the countryside and in the leasure homes along the country’s 200,000 lakes, they are still heated up with logs burning in traditional stoves.
For decades, there has been two big sauna equipment producers and stove makers in Finland. These companies are called Harvia and Narvi.
Their owners were, and still are, among the richest people in Finland.



Photo: Harvia sauna

On Wednesday, December 3rd, the main headline in all the news sites of the U.S. was the mass shooting that happened in San Bernandino, California.
The most read story of the site of the main daily newspaper of Finland, Helsingin Sanomat, was about saunas. It was a column of the paper’s correspondent in Britain who wrote about her friend who wanted to have a Finnish sauna in her in her backyard in London.
“Ordering a sauna from Finland was not possible – why don’t Finns want to make money?” This was the headline of her story (roughly translated).
The text itself told that a Finnish-British family who tried to buy a Finnish sauna from Finland to London didn’t even receive an answer to their requests for offers from the Finnish sauna and stove makers.
Instead, a German sauna maker – with no roots in Finnish sauna tradition – answered immediately and finally built the family a Finnish style sauna with an electric heater.


Finnish readers were very upset about the story. Not only did it tell that foreigners were selling our tradition but it also told that Finns cannot make money abroad – even in the case when it should be really simple. The country’s economic situation is very worrying. Unemployment is in rise. Trade is slowing down.
And Finns let Germans sell the products that should be our national pride!
I wasn’t surprised to read this sauna story.
In Los Angeles, I met a Finnish film maker who told me what happened when he wanted to build a sauna to his backyard in Hollywood. He is a wanna-be carpenter and did all the wood work himself. He had his sauna in a garden shed, and finally only the heating system was missing. He wanted to buy a Finnish stove. He couln’t get one.
He bought a Swedish electric stove.
What a shame.


So what are the Finnish sauna makers doing? I decided to find out.
Money, is the first answer.
The sauna company Harvia’s profit margin has been between 20 to 25 percent every year since 2010. The company started in year 1950 as a small local stove maker and grew until the first years of new millennium.
The owners – a family with name Harvia – then reported that is was the as big as it can get in Finland. The family sold the company to an international investment company, and the company started to grow again.
Its’ net revenue was €40 million in 2010, and €44 million in 2014.

Narvi, the other main sauna brand, is not doing that well. It is a company with good financial standing and high gearing ratio – but for how long?
Last year its net revenue was €6,7 million. The net revenue reduced from the previous year 18 percent. At the same time Narvi made a loss of €282,000, and in 2013 the loss was even bigger: €1,9 million.
In its’ website, Narvi boasts about being “currently the only large producer of sauna heaters in the market, whose entire product range is designed and manufactured exclusively in Finland”.


Keeping the production exclusively in Finland is obviously not that good idea.
Harvia, the profit-making sauna maker, has opened factories in China, Russia and Estonia. They have a sales office in Hong Kong.
The CEO of Harvia told a reporter of Helsingin Sanomat this year, that Asians do not yet ask for a Finnish sauna built in their homes. But Harvia is doing business with hotels. If a hotel wants to have five stars, it needs to have a sauna.

Harvia may have a good reason to ignore one or two Finnish expats wanting to buy a Finnish sauna. Harvia is busy in Asia.
But the sauna maker Narvi, who wants to keep its production in Finland… What on earth keeps it from selling its’ products abroad?

Sleep is worth millions


To perform well, many college students work from morning till evening and even during the night. Many become sleep deprived. And what happens when a hard-working student is sleep deprived for a long time? He or she starts losing the ability to learn. In the end the student just works hard but perfoms poorly.

Psychology professor James Maas worked nearly 50 years in the University of Cornell and founded a class that became the most popular course of the school. There he taught the students to sleep.

Over the years, Maas had more than 65,000 students in his sleep class. Many of them were asked to wear sleep-monitoring headbands during the class so that they would see what happens in their sleep-deprived brains.

“Literally nothing,” Maas says in AP’s article published in Herald-Tribune 2012.

”Confronting students with such photos, along with hard data on how sleep undermines academic performance, is the most effective way to change behavior,” Maas continues in the article.


In work places there are no professors or sleep courses to tell the adults that they should take care of their sleep.

Or there wasn’t, until recently.

Earlier, the mentality was that a worker has to do the job well – no matter if he or she should spend the whole night thinking about and preparing for it. But now companies have started to take an interest in workers’ rest, for the same reason as professor Maas did it at Cornell University.

The workers perform better if they sleep well.

Corporations like Google and Goldman Sachs have told that they now provide their workers with sleep consultancy and other help.

In the end, it’s not about the amount of sleep or the quality of work performances, it’s about money.

There are proofs that people who sleep well are more productive.


University of Harvard conducted a study in 2011 and 2012 to find out how insomnia affects work performance and how much sleep deprivation costs to companies and national economics.

How did they do this?

Researchers of Health Care Policy at Harvard Medical School gathered a national sample of 7,428 employed, over 18-year-old health plan subscribers. These people were interviewed over the phone.

They all filled WHO’s ”Health and Work Performance Questionnaire” and ”Brief Insomnia Questionnaire”.

Those who suffered from a broadly defined insomnia – 23 percent of the interviewees – were differentiated of normal sleepers.

Then associations between insomnia and health and work performance scores were compared.

Result: Insomnia did not cause absence at work but it was significantly associated with lost work performance when present at work.

The researchers counted the amount of lost work performance at individual level in one year time. They estimated that insomniacs lose 7,8 work days because of the poor ability to work due to sleeplessness.

In dollars this was in average $2,280 at individual level and $63.2 billion when generalized to the total US workforce.


Academics are still cautious to say if insomnia treatment programs at work places have desired outcomes.

This hasn’t stopped consultations firms from selling sleep programs and meditating courses to the companies. Offering people relaxation is a huge business.

But then again, as long as employer pays the sleeping consultancy, the employee is likely to benefit.


The National Sleep Foundation of America reminds us that getting less than seven hours of sleep per day is also associated with increased morbidity and mortality.

The foundation tells that because of sleep deprivation, 14 percent of U.S. adults have difficulties in taking care of simple everyday tasks like taking care of their financial affairs.

Sleep is valuable in many ways.




Other sources:



Big markets, small wines


Making wine is California looks like an easy and enjoyable business. The owners of the small Sonoma winery called Rebel Coast Winery drive a yellow van, party on the beach and drink their own wine out of plastic cups. At least that is what they do in the pictures they post on social media and on their website.
The founder of Marketta Winery in Napa is a middle-aged Finnish lady, and her website offers a glimpse to the owner’s rustic and elegant home where she matures and blends her wines wearing a cotton apron. With an endearing smile at her face, she invites customers to come over.

Easy and enjoyable images are well calculated attempts to stand out as winemakers.
The number of wineries in California doubled in past ten years. In 2005, there were 2,275 of them. Now, the number is 4,400.
More wine brands mean more enjoy for wine lovers, but for the winery owners, it means more competition.

In statistics, Californian winemaking is blossoming.
From 1994 through 2014, the volume of the total wine production of the U.S. went up from 35.2 million gallons to 116.9 million gallons. The same time revenues to wineries went up from $196 million to $1,494 million.
This has brought wealth mainly to California, as 90 percent of the U.S wine is made in the sunny and mountainous west coast state.
From the year 2005, the U.S. wine exports have grown as much as 122 percent in value. Exports to Asia have doubled. Although China’s ongoing austerity campaign has a negative impact on sales, the emerging Asian markets are still very promising. The wine industry lobbied strongly for the Trans-Pacific Trade Agreement and expects it to enforce the exports to Asia further.
Japanese buy less Californian bulk wine but more premium California wine.
And the Americans themselves show more and more interest in wine – and in the quality of wine.
“The premium wine segment – $10 and above – is strong and with excellent prospects for continued growth over the next few years,” estimated wine industry consultant Jon Fredrikson of Gomberg, Fredrikson & Associates in his report of year 2014.
The U.S. is now number four in wine production and number two in wine consumption in the world. In consumption, the U.S. seems to be bypassing France – the world’s biggest wine producer and consumer – any time soon.
In per capita consumption, the U.S. is, however, still only 23rd in the world, while France is the second, after tiny Luxembourg. This means it should be possible to sell much more wine to the Americans than what wineries are now selling.
That’s good news for aspiring wine makers. Now wonder the number of Californian wineries doubled in ten years.


“In California, you have to to market aggressively,” says Marketta Fourmeaux, the owner of Marketta Winery.
She worked for French wine industry for decades before moving to California and knows the differences between the old and new world of wine. In France, you need to have prestigious history. In California, you have to make your brand known.
The sales of alcohol beverages are strictly regulated, and if a Californian winemaker wants to sell her wine outside the state, she needs a distributor. In that case, she needs to make an impression on distributors.
Fourmeaux did not feel comfortable in marketing her wines to the professionals.
Earlier her wine was sold to her home country Finland, but the weakening Euro along with trade barriers made the trade all the time less profitable.
”Cheap dollar helped the exports for many years”, says Fourmeaux.
She withdrew from the interstate and international markets and decided to keep the volume of her production very small. She now matures and blends only about 100 cases per season and sells her wine straight through her website.
She is testing and marketing – mouth to mouth and on her website – a new service related to wine. Groups can book an event at her home to taste wines, blend their own wine and design the etiquette.
As a board member of Wine Institute and as a president of Alliance Francaises in Napa, Fourmeaux has excellent networks in California. Good connections are a big advantage when bringing a new product into the market.

The prohibition law of the 1920s and 1930s had a long lasting and depressing effect on the wine culture of the United States. It swept away many old vineyards, and quality grapevines were replaced by lower-quality vines that grew thicker-skinned grapes. These thick-skinned grapes were suitable for gigantic industrial wineries.
Even today, seventy-five percent of Californian wine is produced in the Central Valley where bulk, box and jug wine producers like Gallo, Franzia and Bronco Wine Company operate.
But with the revival of premium wine production and all the new entrepreneurs, the majority of wineries of California are again family-owned businesses, reports Wine Institute, the largest advocacy and public policy association for California wine.

The “family” behind Rebel Coast Winery are three friends – aged 26, 27 and 30 – who studied winemaking together.
They wanted to get rid of the last effect of the prohibition law and make wine associated with “laughing, loving and friendship”, as one of the founders, Kate Seiberlich, puts it.
“We started out in 2012 and decided to target our wines to millennials”, she explains.
They put up the winery with the help of investors. After three years, they earn “as much as interns earn”, says Seiberlich, but they are determined to grow.
“Every single dollar is dumbed back to the company.”
They now produce up to 18 000 cases of wine per year in their Sonoma winery and sell and market it from their office in Palos Verdes.
They expect growth of 300 percent next year thanks to change in their supply chain. They have a new deal with a distributor, who presents their wines in 25 U.S. states and in Canada.
The Rebel Coast winemakers market their wines themselves in social media – they have accounts in Instragram, Twitter and Facebook – and they do a lot grass root and querilla marketing.
“We have to be mean with every penny so we have found our own ways of advertising.”
They have 17 people promoting their wines mostly without formal contracts. They are friends and friends of friends who appreciate wine.
The owners’ personas are key element in advertising. They appear in the promotional photos and videos, and they also attend parties and events in distinctive outfits. The two guys of the company, Chip Forsythe and Doug Burkett, have huge mustache – which are also pictured in their bottles.
“We want to draw natural attention. Our wines are expressions of myself and my business partners.”

As a joke, they started to put their cell phone numbers on the corks of their wines so that people could call and give feedback. This became a permanent practice.
Seiberlich says that wine distributors are “notorious of being slimy and greedy”, but they managed to make a deal with one “who has extremely good reputation” and only quality wines in his portfolio. “He appreciated three kids who started their own company.”

The Rebel Coast Winery has managed to sell their wines, but not quite to those who they thought.
Instead of millennials, women aged 25 to 45 are eager to buy Rebel Coast’s wines.
“There are lot’s of moms. Kind of soccer moms,” says Seiberlich.
These moms have money in their pocket to buy medium price wines. Seiberlich is happy.
“We sell to people who are young at heart. We offer them wild and even inappropriate experience in a form of quality wine. We say that ‘let’s not take it so seriously’.”


Sources: The Wine Institute, statista.com, Alcohol and Tobacco Tax and Trade Bureau, Wine America, GFA Wine

Four ways diplomacy is helping Finnish exports

Finland is a Northern European country with five million habitants. I’m one the five million. Until recently I have known shamefully little about my home country’s trade.

I knew that Sweden – our neighbor on the western side – is our biggest export destination, and that Europe’s economic giant Germany is a significant market as well.

But I wouldn’t have guessed that this year the U.S. bypassed Russia as the third biggest destination of Finnish exports.

Though it shouldn’t be a surprise.

Finland’s trade with Russia has stalled because of president Putin’s repellent expansion politics and the economic sanctions that EU has passed on Russia.


Finland – a small EU country and member in Eurozone –no longer has means to control its own economy with its’ own monetary policy as it no longer has its’ own currency. Many Finns now consider joining the monetary union was an unfortunate decision.

At the moment there is, however, one slight cause of happiness with weakening Euro, and that is the interest American buyers are showing towards Finnish products.

The overall exports of Finland have decreased at an annualized rate of six percent during last five years. During the first six months of year 2015, Finland’s exports to the U.S grew eight percent from the previous year. The markets of all the main export goods – electronics, machinery, ships and boats, paper and paperboard, refined petroleum products, and telecommunications equipment and parts – expanded, and the total value of Finland’s trade to the U.S is now €1.9 billion.


One man in Los Angeles is particularly happy and proud of the brightened prospects of Finnish products’ sales over the Atlantic. He is the consul general of Finland Juha Markkanen.

Markkanen has been in LA for three years focusing on helping Finnish companies to find buyers, investors and co-operations in the country.

He acts along Finnish governments (and previous governments) strategy. In 2011 the government of Finland created a project called Team Finland. Its’ goal is to bring together Finnish diplomats and government bodies with businesses and organizations to accelerate especially Finnish small and medium size companies’ exports. The whole staff of consulate of Finland in Los Angeles has reshaped its priorities since: they are here less for the foreign policy (that is done in Washington and more and more on EU level) and more for economic networking.

Processing passport and visa applications and issues are, of course, still an essential function of the consulate – but that, too, can be seen as clearing paths for the economic co-operation, says consul general Markkanen.

What else a diplomat does in order to accelerate trade?

Markkanen is a precise man and gives numbered answers.

Four ways how diplomacy is helping Finnish businesses to export.


One. The diplomat shares information. Markkanen and his consulate know all the details of legislation and agreements concerning the trade between Finland, EU, Eurozone and the U.S. The consulate helps business people with their concerns with trade tariffs and possible barriers. Equally important is to advice people how to approach the market. For that, Markkanen has created “ten commandments”: 1. Networking is key. 2. Visit the US early, often, and before you have a final product. 3. Ask questions, lots of them, and then ask more. 4. Local presence is crucial. 5. Work with local players. 6. Pick the best partner, never the first. 7. Be swift (24-hour-rule). 8. Be patient and think long-term (follow up). 9. Do the sales/marketing in the US way. 10. Give the market what it wants, not what you think it wants!


Two.  The diplomat offers connections. Consul general Juha Markkanen shows the folder where he has collected all the business cards he has got during his years in LA. There are hundreds of them. Consulates mission is to find networks and to connect Finnish professionals with Californian counterparts.


Three. The diplomat makes visits and organizes them for others. Markkanen points out lines of Finnish business that he thinks have nowadays particular potential in California: 1. Clean tech. 2. Health and wellness. 3. ICT. 4. Creative industries.

He wants entrepreneurs from those branches to know the hubs in California -LA / Silicon Beach, San Francisco / Silicon Valley and San Diego – and otherway round.

He visits these hubs and lobbies for Finnish innovations. When the consul general asks for an appointment with, companies and organizations usually find time for an appointment.

The Finnish consulate recently organized stage time for pitching for five Finnish clean tech companies in a big clean tech conference in LA.


Four. The diplomat uses his residence. The residence of consul general is a beautiful, big house. The foreign ministry of Finland does not buy or rent these kinds of beautiful big houses for its’ diplomats just because diplomats should have a nice home abroad. Juha Markkanen hosts numerous events in his residence where he brings together Finns and Americans. He may allow Finnish business delegations to organize meetings or conferences in his residence. He invites and receives Finnish groups over in LA.


Before I met consul general Juha Markkanen, I had a very vague image of what a consul general does. Now I know that he is an ambassador of Finnish exports.

Though that shouldn’t be a surprise.

If I was to expand my (imaginary) business from Finland to California, who would I contact to have advice? The consulate, surely.

Conquering the world with wine

Finnish-French Marketta Fourmeaux accomplished her dream of having her own winery in California. What else than a dream is needed to make a winery successful?


Näyttökuva 2015-10-09 kello 15.55.04


An oddball. When Marketta Fourmeaux moved to Napa Valley, California, in 1988, she heard she is an oddball. That was probably a nice way to put it. A blond in her mid-thirties, a mother of two, coming from France, born in Finland, said she wanted to buy a vineyard to make her own wine in California.

”Some people would have rather talked to my male dog than me!” Fourmeaux says and laughs. ”There were not many foreign winemakers nor female winemakers in California back then.”

Now, 30 years later, Marketta Fourmeaux is the only Finnish female wine-maker of Napa but no longer an oddball. California is a growing wine area attracting international investors. The U.S. is both consuming and exporting more and more wine – situation totally opposite to that of old wine empire France.

Fourmeaux has created two wine brands in California: Château Potelle and Marketta Winery, and now people pay close attention to what she says. She is a board member of The Wine Institute, the largest advocacy and public policy association for California wine, and the ex-president of the Mount Veeder Appellation Council.

She came to the U.S. well prepared.


Fourmeaux has a master’s degree in economics from Finland and a diploma in enology – the science of wine and viticulture– from France.

In 1976, one single happening in Paris changed Fourmeaux’s life and that same happening shook the world of wine. The Judgement of Paris, a prestigious blind tasting wine competition, rated California Chardonneys and Cabernet Sauvignons over French comparisons.

This was devastating news in France. Fourmeaux was then married to a Frenchman and evaluated wines for the honorable ”Institut des Appellations d’Origine”, the core of the qualifications of French wines.

A group of French wine producers asked her to travel to California to find out what is happening in its’ vineyards. Years earlier she had been an exchange student in California and her English was fluent. Fourmeaux agreed to travel to Napa. Later she sent a telegram home. It said: ”Looks good. We’ll stay.”


Wine is not an easy business. Making a vine grow is a basic form of agriculture, but farming vine to produce wine is much more complicated than farming vine to sell grapes or raisins. The quality of soil, the amount of rain and sun as well as the temperature all play a role in setting the taste and the quality of the final product. It is impossible to control nature. Fourmeaux says that the draught in California has not yet affected Napa Valley’s wine production but she is afraid of what the future brings. If northern California gets dryer, both the volume and the quality of its’ wine may decrease.

Now California produces 90 percent of the wine made in the U.S. The production, consumption and exports of Californian wines have all steadily grown during the time Fourmeaux has been here.

When she came much of the wine making was in the hands of big companies producing industrial bulk wine.

The prohibition law of the 1920s and 1930s had a long lasting effect on the wine culture of the U.S. It swept away many old vineyards, and later quality vines were replaced by lower-quality vines that grew thicker-skinned grapes, which could be more easily transported.

Much of the knowledge of artisanal winemaking was lost.

When Fourmeau bought the 273-acre estate Mount Vedeer in Napa Valley she planted new vines  – Cabernet Sauvignon, Zinfandel, Syrah, Chardonnay and Sauvignon Blanc.

Americans ”new nothing about wine”, says Fourmeaux. The food culture and viticulture ”were not sophisticated in the 80s”, she says, but there was a reason for her to stay in California.

”I could have never became a winemaker in France. Here the oldest vineyards are run by maybe fifth generation of the same family. In France, it is the 15th generation. Foreigners are not accepted or taken seriously as winemakers in France.”


People doubted her in California too, but Fourmeaux says that the U.S. legislation made it easy to start a business and then proof that she can make good wine.

”Having a vineyard and winery in France means endless fighting with bureaucracy. Here I was able to concentrate immediately on developing the vineyard and the business.”

Fourmeaux wishes she could say that quality of wine means everything in sales but that is not true. The brand means nearly everything. Newcomer has to market aggressively.

”The most expensive wines of the world are not necessarily the best wines,” Formeaux says. The most wanted wines are the ones that have a name and fame.

Fourmeaux’s Mount Vedeer produced and sold around 300 000 bottles a year. It was a small, independent winery that had clients – restaurants, wine dealers and direct buyers – who had learnt to know the winemaker and appreciated her talent and brand. They were not looking for big volumes or a cheap price.

This kind of production is very vulnerable in economic turmoils.

The volume of the wine production of the U.S. has grown in past ten years from 35 million gallons to 117 million gallons. At the same time, the revenues to wineries grew from from $196 million to $1,494 million. There was a drop of one million dollars between the years 2009 and 2010, after the financial crisis of 2008.

”Premium wine is a luxury product. Many of my clients have big wine cellars. After the market crash they stopped buying new wines and started drinking the ones they already had in their cellars,” says Fourmeaux.

”I know many small winery owners who have been forced to quit because they haven’t had capital to overcome bad years.”


”I could have never became a winemaker in France. Here the oldest vineyards are run by maybe fifth generation of the same family. In France, it is the 15th generation. Foreigners are not accepted or taken seriously as winemakers in France.”

Fourmaux was forced to give up the Mount Vedeer estete and Château Potelle brand when she divorced. She now buys grapes from vineyards she has helped during her years in California and gets to choose the ones she wants. She gets a small amount from her own backyard plot of 100 acres. She matures and blends her current wine called Marketta in downtown Napa.

Marketta Winery produces only about 100 boxes of wine per year and sells them to two restaurants and loyal old customers. Earlier her wines were exported to Europe. Today Fourmeaux prefers to keep her business small although she knows that there are potential markets.

The European Union’s 28 member countries are the largest export market for California wine. Last year they accounted for $518 million and 35 percent of the exports. Canada is the second largest export market with value of $487 million. Following eight export areas are Japan ($88 million), China ($71 million), Hong Kong ($69 million), Mexico($24 million), South Korea  ($22.2 million), Nigeria ($21.9 million), Vietnam ($20 million) and Singapore ($16 million).


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”Cheap dollar helped the exports for many years”, says Fourmeaux.

With weakening Euro, exports to Europe are down slightly. The Wine Institute of California is not expecting the situation to get any better in the near future.

The UK however, is seen as a more promising market. The sales of wines at low prices are decreasing in the UK but the sales of wines costing $15 or more increased last year by 30 percent.

In Japan, the situation is similar to the UK. The volume of the exports to Japan is decreasing because less and less bulk wine is shipped to Japan but at the same time Japanese show more interest in premium California wine.

Since 2011, the value of wine exports to Asia has doubled, and the future looks bright.

Even though the economy of China is currently slowing down and California wine exports to China and Hong Kong decreased last year. “Asia’s emerging wine markets remained buoyant in 2014 despite the negative impact of China’s ongoing austerity campaign”, reports The Wine Institute. ”However the long-term outlook for these key markets remains very promising.”

Wine industry lobbied strongly for the Trans-Pacific Trade Agreement and is pleased with the result so far. Wine trade will remain under special regulation but many trade barriers are to be eliminated.


If Marketta Fourmeaux was now to advice a young, enthusiastic winemaker on where to start her own winery, she would not recommend California.

”The land is so expensive. One acre of vine costs 250,000 dollars or even more.”

California attires affluent investors, and in Marketta Fourmeaux’s opinion some of them come here out of vanity. ”They want to make themselves nobles by buying a vineyard.”

California still has many advantages. The climate is ideal, and it is easy to get cheap work force from Mexico.

The country’s wine consumption is growing. The U.S. is now number two in wine consumption in the world and will likely bypass France soon. In per capita consumption, the U.S. is only the 23rd in the world when France holds the second place – after tiny Luxemburg. There should be plenty of room to sell more and more wine to the Americans.

However, Marketta Fourmeaux would advise a new winemaker to start in South America – or maybe in India which is an emerging wine area.

Chinese drink more and more Western style wine, and the climate is good for growing grapes in many parts of the huge country. China is already a huge producer of raisins. But China does not welcome foreign entrepreneurs in its’ agriculture.

France and Italy have long been the largest wine producers of the world. These old world countries are slowly losing their positions. The traditional, hierarchical, male-dominated wine industry is not appealing to young consumers nor innovative entrepreneurs.

Fourmeaux thinks this could actually open paths for new winemakers in lesser-known wine areas of France.

Marketta Fourmeaux is sure that one does not need to be an economist to become a successful wine producer. One needs to know wine and be ready to work hard.

Timely storyteller


Erin Germain, 34, is a media innovator who gets clients from other innovators. The changing economic landscape has made old media companies fall apart while newer and smaller entrepreneurs profit from each other.

Tuija Pallaste


One o’clock Wednesday afternoon Erin Germain, 34, sits on a sunny patio at the campus of University of Southern California. On the table in front of her she has her laptop and a plate of falafel.

Germain is having a meeting. Another two participants are her business partner and a client with whom she plans a video shoot. All three are on their phones miles away from each other wearing earphones.

Germain has one hour to manage her business and have lunch before her lecture at journalism school starts at 2 pm. She is a journalism graduate student who knows for sure that there are job opportunities in her field of study. She is creating those opportunities herself.


Media environment is in turmoil and economic situation has long been uncertain and that is exactly why Germain has for two years now ran her own production company called For Example.

“I would not have my business if the current landscape would not be what it is.”

For Example is specializing in producing documentary-style videos for companies and non-profit organizations. “Branded content” it is called. Her videos are beautiful stories of ordinary people sharing their life experiences or attending events.

“For us it works best if there is a good and authentic story that includes the brand,” Germain explains.

Sometimes there is just a story and the brand is integrated into it.

Companies and non-profits use the videos for their PR and marketing. For Example creates ideas, finds the right people and uses its’ distinctive visual style to match clients needs. They have worked for small non-profit campaigns and huge brands like Neutrogena, Lenovo and LEGO.

The idea of documentary-style branded content is Germain’s own. When she started two years ago there were not many companies doing that kind of videos.

Now branded content has became a big trend in the media business along with “native advertisement”. No wonder it has. After many profitable decades the advertisement revenues of traditional media companies dropped in 2010s to the level of 1950s, Brown Institute of Media Innovation counts. Print adds nearly disappeared, and banner advertising turned out to be a poor replica of traditional advertising in the internet.


Germain finished her undergraduate studies in media arts 13 years ago when the dot.com bubble had recently burst and many old media companies were losing their wealth. Social media was getting a stronger hold of the media ecosystem.

Germain did not have specific career expectations. “I had no idea what I wanted to do.”

Her uncle had an empty apartment in Chicago. As she was promised a free place to stay she applied for an internship at Oprah Winfrey’s Chicago-based Harpo.

She got in. Harpo is a success story and Germain loved her job at research department, but she missed her family in California. With her work experience at Harpo it wasn’t difficult to get into Los Angeles’ TV industry. She ended up producing reality TV shows, medical shows, travel shows and documentaries, as a freelancer in LA.

“Every three to six months I had a different job.”

She even went to teach English and video production in Ecuador.

“When I was in between jobs, I started to do some thing for non-profits.”

All these works proved to be significant when she finally set up her own company. She had learned to cope the uncertainty and to connect with a lot of different people. Most importantly: she had what good storytelling required.

“I learned how to tell a great story from some of the best people in the industry.


First assignments For Example got through a pitching site called Tongal – which itself was a sign of changing media economics. Companies worked on tight marketing budgets and this new internet service helped them to find freelancers and productions companies in a new money-saving way.

Tongal explains its’ idea like this:

“1. Businesses like LEGO post projects to Tongal. 2.Tongal community goes to work generating ideas. 3. Winning ideas are chosen.”

”Tongal community” means professionals interested in sending their work proposals via Tongal to realize a project.

For Example immediately gained success on Tongal. They were chosen to be The Tongaler of the Month in November 2014.

The site ranks the “Tongal community members”, and For Example is currently nr 21 in production (having earned $259,725)

“Tongal allowed me to start” says Germain.

Budgets can still be tight. Germain needs a crew of 2-15 people for the videos.

“On our biggest shoots we have a cameraman, a sound person, a make-up person and a technical person and more.”

“It is always balancing with the budgets. I was working on documentaries where budgets were never big so I know how to do it. We are not relying on special effects but on a good story. A million dollar idea does not work out well with 10,000 dollar budget.

Thanks to her numerous freelance jobs she knew a lot of freelancers.

“I knew good ones that I trusted. If they can not do it they always recommend someone else.”


Germain has finished her phone meeting and falafel lunch on the patio.

For Example is a limited liability company and a partnership. One thing Germain did not know when she started: how to ran a business.

“I still have no idea about that side sometimes. I am always learning as I go.”

She asked her college friend to be a co-founder as she had experience of marketing. They both work where their laptops are. Laptops, software and internet connection are all they need. Other technical gear comes from the people they hire.

Germain is often at campus. She got a fellowship to do post-graduate studies and decided to go for it. As an entrepreneur she can arrange her timetables and eventually she would like teach branded content.

“Now everybody is doing it,” she says.

What chart should I keep my eyes on?

To sell or not to sell.

Business Insider publishes every year the list of The Most Important Charts in the World .

To put up the list, they ask some of the world’s most influential analysts, economists, hedge-funders and traders one question: What charts are you always keeping your eyes on?

Almost all the answerers – 50 experts in economy – give a different answer. And that does not make an ordinary reader like me wiser.

I believe the 50 professionals – among them Nobelist Paul Krugman and Bloomberg’s chief economist Michael McDonough – follow more or less the same economic indexes, but what is the most important for each, depends on the job they do and the decisions they have to make.

So there is no such thing as the most important chart in the world.


I have not really been keeping my eyes on any economics chart, but now I am about to sell a hut. It is a tiny seafront cottage in my hometown Helsinki. It is surrounded by 100 other tiny cottages in the area that used to be a recreational place for city’s policemen and public transit workers.

At the turn of the millennium the city of Helsinki, who owns the land, decided that it was time for all the residents of the city to enjoy this place. Anyone living in Helsinki was allowed to buy a cottage from the area – if somebody was willing to sell.

I was one of the first “outsiders” to buy one. I bought it from an old constable’s widow for €6,000. I was lucky. The area is charming and prices of the huts soon started to go up.

Last year one of my neighbors sold her hut for €50,000. Another sold his for €38,000.

I did not consider selling mine until this August. My study year in California turned out to be more expensive than I expected (this is why).

The question is now: should I sell it or wait until later? What chart should I keep my eyes on?


I looked again at the Business Insiders most recent list of ”the most important charts in the world” (February 2015).

None of those indexes seemed to relate to my situation – except for Eurozone charts that showed that the economic situation in Europe is nothing but deteriorating.

As I need the money, I decided to follow my instinct with help of one chart.


Consumer Confidence Index (CCI) is measured world wide and ”based on households’ plans for major purchases and their economic situation, both currently and their expectations for the immediate future”, as OECD explains it.

In the U.S. the consumer confidence went down the first half of the year 2015 but increased during the summer months.

In the Euro area the confidence was increasing the first four months of the year but has since decreased. Finland’s figures are in line with the European ones.

Every month national center of statistics interviews 1200 Finnish consumers and compares their opinions to a ”normal” state. Long-term median value of the CCI in Finland is 11,8.

In June 2015 it was 10,8. In July it was 6,9.

With this in mind I figured that I should sell my cottage for any price as fast as I can, before consumer confidence is in zero.

However, when comparing to last year’s index, the CCI shows that confidence is in fact increasing. In August 2014 it was only 2,2.

When taking closer look I realized that opinions varied a lot. According to the most recent CCI 30 percent of the Finns believe that the economic situation of Finland will get better in year’s time. 27 percent believe that it will deteriorate.

What can I learn from this?


I do not think consumers are well-informed with the economics. In my opinion media fails to tell about money and markets comprehensively, and even the best economists fail to predict the future.

However, economy are not just facts. It much about trust and feelings.

When one consumer reads that – according to the CCI – other consumers are gaining confidence in the economics, he might think that: yes, it is time to buy the hut of his dreams.

And I am the one to sell him that.

There still might be people who have courage to buy a trendy cottage for a good price.