Finland Modern History

By | January 31, 2023

Finland is a country located in Northern Europe. With the capital city of Helsinki, Finland has a population of 5,540,731 based on a recent census from COUNTRYAAH. After World War II, a peace treaty was concluded between Finland and the Soviet Union in Paris in 1947. In it, the borders of the Winter War 1940 were restored, which meant that Finland lost about eleven percent of its area when, for example, Petsamo on the Arctic Ocean became part of the Soviet Union. Finland instead regained the important port city of Hanko, but was forced to transfer the Porkala area west of Helsinki as a Soviet base. However, Porkala was returned to Finland in 1955, despite the fact that the area was leased on lease for 50 years. Finland was also forced to pay a $ 300 million war damages to the Soviet Union.

An agreement on friendship, cooperation and assistance, the so-called VSB Pact, was concluded in 1948 between Finland and the Soviet Union. The agreement meant, among other things, that Finland would stay neutral in the Cold War and that Finland would defend itself against German attacks that were ultimately directed against the Soviet Union. The VSB Pact formed the basis for a new Eastern policy, which was named the Paasikivi-Kekkonen Line after the two presidents who ruled the country in the coming decades.

  • ABBREVIATIONFINDER: List of most commonly used acronyms containing Finland. Also includes historical, economical and political aspects of the country.

In order to maintain good relations with the Soviet Union, Finland, in the post-war period, adapted to Soviet security interests, a policy that gave rise to the concept of “Finlandization”, a small state’s adaptation to a great power. Fascist parties were banned, while the Communist Party was allowed to operate for the first time since the 1930s. Together with other groups within the Left, the Communist Party in 1944 formed a new party, the Democratic Alliance of the People of Finland (usually called the People’s Democrats), which became a political power factor and joined several governments. Check best-medical-schools for more information about Finland.

Industrialization is accelerating

Following the communist takeover of power in Czechoslovakia in 1948, Finland was subjected to severe pressure to sign an agreement similar to the agreements imposed by the Soviet Union on a number of Eastern European states.

Rumors spread that a communist coup was also planned in Finland and the Finnish armed forces began to mobilize. Interior Minister Yrjö Leino was forced to resign and in the 1948 parliamentary elections his party the Democrats strongly resigned and were excluded from the government.

Finland’s industrialization took off after the war. The development paradoxically got a push of the large war debt to the Soviet Union, because when it was paid in 1952, Finland received large industrial orders from the Soviet Union. The following years, upwards of a quarter of Finland’s total exports went east, which meant that Finland, after West Germany, was the Soviet Union’s largest non-socialist trading partner.

In its other international contacts, Finland was forced to exercise caution, even though the country endeavored to show that it belonged to the West. In 1954, freedom of passport was introduced between the Nordic countries and a free Nordic labor market was created. One year later, in 1955, Finland joined the Nordic Council and the United Nations (UN).

A modern industrial nation and welfare state

From time to time, Finland’s relations with the Soviet Union were strained. Soviet dissatisfaction with bourgeois-controlled Finnish politics led to the so-called night frost in 1957–58, when Moscow froze contacts with Finland. In 1961, the Soviet Union sent a message in the form of a note to Finland demanding that the countries extend the VSB pact because of the tense situation in the Cold War Europe. The demand triggered the so-called note crisis. However, deliberations on the pact were averted by President Urho Kekkonen meeting with Soviet party and government head Nikita Khrushchev. Kekkonen’s ability to negotiate with Soviet leaders was of great importance even at other times.

At the same time, Finland participated in several UN peacekeeping efforts. The country’s great success within the UN became the host of the European Security Conference (ESC) in 1975.

In the 1950s, domestic politics was dominated by an alliance between the Agrarian Party (1965–1988 Center Party and from 1988 the Center in Finland) and the Social Democrats – the so-called “red mill governments”. The People’s Democrats were not allowed to participate in government work and in the late 1950s the Social Democrats were also excluded, as the Soviet Union openly showed their distrust of them. Only after the 1966 elections did the Democrats and Social Democrats return to the government together with the Center Party and some small parties.

Despite constant recurring government crises, the economy continued to grow and Finland was gradually transformed from a peasant society into a modern industrialization and welfare state.

The Soviet Union disintegrates, Finland goes west

After the 1987 election, the Conservative National Assembly formed a coalition government with, among others, the Social Democrats, led by Harri Holkeri. This meant the end of a period of Soviet influence over Finnish politics through either the Center Party or the People’s Democrats.

However, the new red-blue government did not last long. After the 1991 elections, a purely bourgeois government took office. In the same year, the VSB agreement was terminated following major changes in the Soviet Union and throughout Eastern Europe in connection with the fall of the Berlin Wall in 1989.

After the end of the Cold War, new issues dominated the political debate in Finland and a new generation of politicians took over. The main symbol of the old era, President Urho Kekkonen, had passed away in 1981 due to illness after 25 years in his post. He was succeeded by Social Democrat Mauno Koivisto, who during his presidency in 1982-1994 partially continued in Kekkonen’s footsteps with a cautious eastern policy, but Koivisto gave the Riksdag greater influence over foreign policy. During his time as president, direct elections were introduced to the presidential post and a limit was set for how many times a president could be re-elected. Koivisto was succeeded in 1994 by Social Democrat Martti Ahtisaari.

Ahtisaari was internationally recognized as a UN peace negotiator in, for example, former Yugoslavia in 1999 (see Foreign Policy and Defense).

Finland becomes an EU member

The collapse of the Soviet trade in conjunction with the end of a speculation wave led to a sharp decline in the Finnish economy in the early 1990s (see Economy). The government implemented drastic savings measures that became visible to the public.

In 1992, Finland applied to become a member of the European Union (EU). Hopes that membership would boost the economy were an important argument for EU supporters. Among the residents, it was mainly highly educated metropolitan residents who saw the benefits of an EU connection, while many in the countryside worried about what the membership would entail. Finland became an EU member in 1995 since 57 percent of voters voted yes to the EU in an advisory referendum the year before.

In the 1995 parliamentary elections, the Center was made responsible for the economic austerity and lost government power. Social Democrat Paavo Lipponen formed a government with the Collecting Party, the Swedish People’s Party and a number of small parties, the so-called Rainbow Coalition. That government, too, had to implement a cut-off policy to manage Finland’s state finances.

In 1999, Finland joined the EU’s currency cooperation EMU. In the parliamentary elections that year, the Social Democrats managed reasonably well and the Samling Party went ahead and the rainbow coalition could remain. The center remained the largest opposition party. One year later, Tarja Halonen, the Socialist Foreign Minister, was elected as the first woman to be the President of Finland. The same year, a new constitution was adopted in which the power of the parliament was strengthened at the expense of the president. Instead of the president, the prime minister now became the most important political actor in the country.

The financial crisis is followed by the euro crisis

In the 2003 parliamentary elections, the Center became the big winner. The Social Democrats followed closely, while the Socialist Party and the Left Association ended up in the background. The center, under its new leader Anneli Jäätteenmäki, formed government with the Social Democrats and the Swedish People’s Party. Shortly after the election, Jäätteenmäki had to resign after information that she had used secretly stamped information to suspect her political rival Paavo Lipponen during the election campaign. She was replaced by her party mate Matti Vanhanen.

The 2007 parliamentary election was a success for the bourgeois parties. The Green League and the EU-skeptical and immigration- critical True Finns also made the choice. The Social Democrats, on the other hand, lost support and left the government. Vanhanen could remain as prime minister. In 2007, Tarja Halonen was re-elected president.

The issue of NATO membership ended up high on the political agenda in 2008 when Alexander Stubb’s unifying party became new Foreign Minister. The NATO issue was also driven by several other leading politicians, but no new initiatives were taken when a majority of Finns opposed an accession to the military alliance.

The global financial crisis that began in 2008 came to characterize the political debate, as well as the difficult economic problems that subsequently hit several countries in the euro zone. Resistance to the EU support package for countries in acute economic crisis was strong in Finland, both politically and among the public. Many Finns felt it was wrong for those countries that did well to take responsibility for those who had misunderstood their finances. Another argument was that Finland could not afford as the country had already been forced into cuts in, among other things, healthcare and schooling. Support for the EU-critical True Finns increased.

The Euro crisis gives the Finns traction

In spring 2010, the Riksdag voted yes to the EU’s first emergency loan to Greece, but the issue raised controversy. The strongest opposition came from the Left Union and the True Finns, but the Social Democrats also tried to appease the public opinion by demanding guarantees from Greece to approve the loans. At the same time, the party tried to win over voters from the True Finns by paying attention to problems linked to immigration.

In June 2010, Matti Vanhanen was forced to resign as prime minister following a grant scandal. New head of government and center leader became Mari Kiviniemi.

In the electoral movement ahead of the parliamentary elections in April 2011, the debate on the problems in the euro zone continued to dominate. After Greece, Ireland had also been granted substantial financial support from the EU (and the International Monetary Fund (IMF)). A possible new support package for the next crisis country, Portugal, fueled the debate. Only the Center and the Collective Party wanted Finland to help Portugal, the other parties were opposed.

The true Finns pleaded for an exit from the EU and demanded that all possible emergency loans to economically weaker countries within the euro zone be stopped. In addition to the True Finns, the Center also opposed new support packages.

Another issue that was discussed during the electoral movement was how to solve the financing of welfare as the population grew older, while the shortcomings in today’s elderly care were highlighted. The true Finns also went to the brink of abolishing compulsory Swedish education in compulsory school and upper secondary school, but got discouraged from, above all, the Swedish People’s Party.

The unity party forms a government coalition

All parties except the True Finns lost support in the parliamentary elections in 2011 compared to the 2007 election result. One reason for the Center’s crusade was that it, as the largest government party, was to blame for the financial problems at the end of the first decade of the 21st century.

The government negotiations were extended. Only after a couple of months could the leader of the Socialist Party Jyrki Katainen form a new government with six parties. Initially, talks were also held with the true Finns, who, however, chose to stand outside the government after the May Party and the Social Democrats had agreed in May on the EU decision on a support package for Portugal.

In December 2011, Germany and France presented a proposal for amendments to the Lisbon Treaty, which meant stricter budgetary rules for all EU countries through a so-called financial pact. The purpose was to avoid new crises like the one in the future. In June 2012, the Finnish Pact was approved by the Finnish Risk Day.

Finland’s economy was also affected by the problems in the euro area. The industry was forced to save as important exports to countries in the EU and the euro zone fell. The crisis also led to increased skepticism about the euro.

The government is weakening

In the January / February 2012 presidential election, the Candidate Party candidate, former President and Finance Minister Sauli Niinistö, clearly won in the second round over the Green candidate Pekka Haavisto. Thus he became the first bourgeois president in over half a century.

Government cooperation was periodically strained and in March 2014, the Left Federation left the coalition after disagreement on the budget. The party opposed reductions in the child allowance, student loans and the guarantee pension. In May of that year, Katainen announced that he would resign as chairman of the Collective Party, which meant he would also leave the Prime Minister’s post. In mid-June, EU Minister Alexander Stubb was elected new leader of the Assembly, and on June 23 he was elected new Prime Minister. The next day, Stubb formally assumed the post of head of government. He made only minor changes in the composition of the five-party government.

In September 2014, the Green League also left the government. The reason for the drop-off was contradictions around a new nuclear power plant. There were Russian interests in the power plant building, which the Green Confederation opposed to the fear of increased Russian influence.

The 2015 election

Opinion polls before the parliamentary elections in the spring of 2015 showed that confidence in both Stubb and his party as well as the then four-party government fell. At the same time, the Center increased rapidly in the surveys. The electoral movement came to a large extent on the Finnish economy, which has been downhill for several years. The reasons for the economic downturn were several: serious problems for the large telecommunications company Nokia and for the important pulp industry. In addition, Finnish exports had been severely affected by a series of import bans on goods from the EU to the important Russian market in Finland. Russia’s import stoppage was a consequence of the sanctions imposed by the EU on the country as a consequence of Russia’s annexation of the Crimean Peninsula in Ukraine and the Russian involvement in the fighting in eastern Ukraine.

In the election, the Center became the largest party expected, while the Assembly Party gained slightly more votes than the True Finns, who, however, as a result of the election system, received a mandate more than the Assembly Party and became the Parliament’s second largest party. The Social Democrats were fourth largest. The Greens, the Left League, the Swedish People’s Party and the Christian Democrats also took their seats in the Riksdag.

In May, Center leader Juha Sipilä presented a completely bourgeois government consisting of the Center, the Collecting Party and the True Finns. Timo Soini, leader of the true Finns, was appointed foreign minister and EU minister. Former Prime Minister Alexander Stubb became Finance Minister.

Finland Modern History