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Finland: Virtually Unchallenged
Finland is a very dynamic place.
Take Nokia, for instance. In 1988, it was
a struggling conglomerate, selling paper, rubber, chemicals,
flooring, and ventilation systems. Through a concentrated
effort, however, it transformed itself into a telecommunications
company, and today Nokia is the global leader in cellular
phones, with an estimated 34% of the market, up several percent
in just the latest quarter.
Collapse --
Or consider the Finnish economy as a whole. In 1989, the banking
system in Finland collapsed, and not long afterwards, its
major trading partner -- the Soviet Union -- dissolved. By
1991, unemployment was 20% in Finland. Today, annual GDP per
capita has rebounded to about $27,000, similar to the level
in the combined Germany, and closing in on the $36,000 level
of the U.S. Finland still has significant imports from Russia,
but its leading trading partners are now Germany, Sweden,
the U.K., and the U.S.
The story of Finland's economy in the '90s
is mirrored perfectly in a chart of non-ferrous casting production
during the period.
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Building Ground Stations
-- Finland experienced a very depressed economy during the
early '90s, but in the second half of the decade it recovered
and surpassed its former level. In the course of that recovery,
non-ferrous castings exports rose to about one-third of total
non-ferrous casting output in the late '90s, compared to just
6-10% of the late-'80s levels. By the end of the decade, non-ferrous
production was up about 25% overall, to 10,000 tons annually.
"Much of that is thanks to data technology and mobile phones
(especially Nokia), including the ground support stations
and the many components they require," says Pentti Kangasmaa,
from MET/Finnish Foundry Group. (MET is the Federation of
Finnish Metal, Engineering and Electrotechnical Industries.)
The situation is virtually the same in ferrous
metals. Started at 120,000 tons at the beginning of the decade,
production fell about one-third during the middle years, and
then recovered to its former level at the close of the '90s.
Exports, starting from a strong base of about 20%, continued
to grow to nearly 30% of production. The interesting thing
is that all the growth has come in ductile iron. Ductile has
grown to be about 40% of total iron production in Finland.
While Finland used to export gray and ductile iron castings
in equal quantities (about 10,000 tons per year each), ductile
has grown to the 18-20,000 ton range.
NOKIA -- It is
nearly impossible to overstate the importance of Nokia to
Finland's economic resurrection. In 1994, when Nokia had 20%
of the world market share in cell phones, global sales had
just reached 35 million units for the previous 15 years combined.
Its stock market value of $7.5 billion was equal to more than
a third of Finland's depressed GDP of $20 billion. As indicated
above, today the company controls 34% of a a market in which
projected sales for 2001 are 500 million units.
Nokia's success didn't come out of nowhere.
In the late '70s, the telecommunications authorities of Sweden,
Denmark, Norway, and Finland decided to build the world's
first international cellular system, and Nokia leapt at the
opportunity to supply it. That explains how Nokia came in
under the radar of some of its biggest competitors, including
Sweden's Ericsson. "They thought wireless was a pretty small
market niche, but we saw it as an opportunity," says the head
of Nokia's cellular division.
Helsinki Virtual
Village -- Nokia was in the right place at the right time,
and all of Finland has benefited. Maybe that's why people
are giving the benefit of the doubt to a new Finnish hi-tech
project: a suburb of Helsinki that is projected to house 700
information technology companies with 8,000 employees -- together
with 12,000 residents and 4,000 students enrolled at local
universities -- by 2010. The "glue" that will hold this community
together? You guessed it. "Helsinki Virtual Village" will
be "a wireless interactive community, based on a local area
network, making a wide range of services available through
broadband fiber-optic cable and wireless links, which will
be accessible anytime, anywhere."
R&D -- Within
Finland, R&D is centered at the Helsinki University of Technology
in the suburb of Espoo, and in the Foundry Insititute within
Tampere University of Technology. Some research is also done
at Technical Research Center of Finland, also in Espoo.
Links to Foundries
in Finland -- There are thirty-seven major foundries in
Finland. (For information on each, search the CastingTrade.com
World Foundry Guide.) Below are links to some representative
companies.
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