June 2, 2020 / 7:37 PM / a month ago

Finland's government adds 5.5 billion euros to state budget due to virus

HELSINKI (Reuters) - Finland’s government said on Tuesday its fourth additional state budget this year amounted to 5.5 billion euros ($6.14 billion), agreed upon to shield the country from the economic and social blow caused by the coronavirus outbreak.

The five-party centre-left coalition said it would channel the additional funds to investments in infrastructure, education and healthcare among other things.

Following the fourth addition, state net borrowing requirement will increase by 5.3 billion euros, amounting in total to 18.8 billion euros in 2020, it added.

“Year 2020’s fourth additional budget proposal is part of the aftercare of the coronavirus epidemic, with which the government supports an economically, ecologically and socially sustainable recovery from the crisis,” it said in a statement.

The government also said it would seek to stabilize Finland’s debt-to-GDP ratio by the end of this decade, which the finance ministry estimated in April to stand at around 52% of the gross domestic product at the end of 2020.

The government said it would direct 320 million euros to child and youth wellbeing, including additional admissions to higher education and resources for schools to allow children to catch up after two months of remote learning and school closure earlier this spring.

“The transport network is a crucial factor for the success of Finland and its regions, as well as a prerequisite for new investments, finance minister Katri Kulmuni said.

Traffic investments will amount to about 450 million euros.

The amount includes 156 millions to infrastructure needed to enable Metsa Group’s [FINPAP.UL] planned investment worth 1.5 billion euros to build a bioproduct mill in Kemi, northern Finland.

Kulmuni said the government would also fund the electrification of an old railway link that connects Finland and Sweden in the north, enabling rail access for passenger and cargo traffic from Finland via Sweden to the rest of Europe.

Reporting by Anne Kauranen; Editing by Chizu Nomiyama and Angus MacSwan

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