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Speeches, 1/15/2007

Speech by Minister Lehtomäki at the Saudi Arabia – Finland Business Seminar in Riyadh

Keynote address by Ms Paula Lehtomäki, Minister for Foreign Trade and Development of Finland, at the Saudi Arabia – Finland Business Seminar in Riyadh on January 15, 2007

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Mr Chairman, Excellencies, Ladies and Gentlemen,

It is an honour and a pleasure for me to be here in Riyadh and address this high level audience of Government and business representatives. This is my first visit to Saudi Arabia, but one in a long line of high level visits between the Kingdom of Saudi Arabia and Finland. Many of these visits, just as this one, have included a strong business component. And each time, interest among the Finnish business community has been very strong.

Today I am here with a delegation numbering close to 50 persons and representing over 20 Finnish companies. The main aim of our visit is to deepen and expand the commercial ties between Finland and Saudi Arabia. Meeting potential partners face to face, like today, is the best possible start for new joint projects.

Ladies and Gentlemen,

With trade flows between our countries growing at an unprecedented rate, the timing of our visit could not be better. In 2005, Saudi Arabia was the fourth largest export destination outside Europe for Finnish businesses. In 2006, it competed for the title of our number one export destination in the Gulf region.

At the moment, Finnish exports to Saudi Arabia consist mostly of telecoms and paper, our traditional national strongholds. Significant potential for expansion of our bilateral trade into other sectors exists, however. One principal reason for our presence here today is to explore that potential. The Agreement on the Encouragement and Reciprocal Protection of Investments between Finland and Saudi Arabia - which is expected to be concluded in the near future - will establish a welcome basis for this endeavour.

One promising area is the construction sector, in which Finland has a solid reputation and many examples of successful projects in the Gulf region. Given the tremendous boom in construction in Saudi Arabia, ample opportunities for enhancing cooperation are obvious. There are significant investments being made in Saudi Arabia also in education, healthcare, infrastructure and environment. In all these sectors, Finland has developed extensive know-how and technological expertise.

Other important sectors in the Finnish economy include, among others, our traditionally strong metal and energy industries, the more recently developed software and automation sectors, defence material production and advanced food processing. I have understood that these sectors - which are represented on my delegation here today, as well - are also on high demand in the Saudi Arabian economy. All these Finnish business leaders here today will be happy to provide you with examples of their expertise.

Ladies and Gentlemen,

Finland has come a long way from being a country of just pulp and paper - a country standing on wooden legs, as we were once described. The Finnish economy has undergone a tremendous structural change over the last decades: Our national economy's performance has risen from average to world class, the structure of our industry has become diversified, and the share of exports in our GDP has grown with high tech products constituting today over one fifth of all our exports.

All this has been achieved while maintaining a healthy public economy. In fact, the Finnish public economy today is doing clearly better than public economies in the European Union in general. Finland also continues to rank among the top countries in the world in economic growth - 5,9 per cent in 2006 - and in business competitiveness.

How did we manage to do all this, in a short span of a few decades? In Finland, our national strategy is based on the realisation - by the Government and business alike - of the crucial importance of investment in human resources. The President of Finland, Ms Tarja Halonen, when asked last July in an interview on Al Jazeera about the secret of our success, put her answer in three words: Education, education, and education. I could not agree more. Basic education for all contributes to the aim at having the society's entire intellectual capacity in use.

High levels of investment in research and development and close cooperation between the Government, academia and business sector in the area of R&D are key features of the Finnish model. Our public R&D spending ranks among the highest in the world, and Finland of today is best described as an innovation and knowledge economy. - Quite a long leap for a country used to standing on wooden legs!

This success is not a coincidence, but the result of conscious policy decisions and consistent work by the Government in cooperation with academia and business. The Science and Technology Policy Council of Finland, chaired by the Prime Minister, advises the Council of State and its Ministries in questions relating to science and technology. Furthermore, it is responsible for the strategic development and coordination of the Finnish science and technology policy as well as of the national innovation system as a whole.

The Finnish Parliament is also very active in the work on innovation policy. The Committee for the Future of the Parliament functions as a parliamentary body that conducts assessments of technological development and effects of technology on society. Just this week the Finnish Parliament is hosting the General Assembly of the International Parliamentarians' Association for Information Technology, with representatives also from Saudi Arabia.

We have noted the keen interest in diversifying the economy here in Saudi Arabia, as well. A strong technology focus is evident in the Medina Knowledge Economic City project, for example. In many ways, this is a global trend, too. Intensifying our dialogue and exchange of experiences on these issues, both bilaterally between Saudi Arabia and Finland, and regionally between the Gulf countries and the European Union, would therefore seem like a good way forward.

Mr Chairman, Ladies and Gentlemen,

As you know, Finland is a member of the European Union and the Euro zone. In fact, we just handed over the Presidency of the EU to Germany, around the same time as Saudi Arabia took over the Presidency of the Gulf Cooperation Council. I would like to congratulate the Saudi Arabian Government on assuming this important responsibility, and on the successful GCC summit held here in Riyadh in December.

From a European perspective, the record of economic integration in the EU is one of our most distinctive achievements. The EU single market is a groundbreaking milestone in European economic history. In addition to its economic significance, the introduction of the single currency, the Euro, was an important psychological step for European citizens, as well.

At the GCC summit in December, these same topics - single market and single currency - were discussed from the Gulf perspective. In Europe, we have followed the GCC discussions with great interest, and we look forward to continuing our fruitful exchanges on these issues at the next EU-GCC Ministerial meeting in Riyadh in April.

During the Finnish EU Presidency, one of our aims was fostering closer ties between the EU and the Middle East region as a whole. In the Gulf region, focus was mostly on the negotiations on a Free Trade Agreement between the EU and the GCC. While not quite meeting the goal of concluding the negotiations during the Finnish Presidency, the EU remains committed to reaching a final agreement by the Ministerial meeting in April. With strong Saudi Arabian leadership on the GCC side, this should indeed be possible. I can assure you that the EU trade ministers will work very hard on this, since we are convinced that the FTA will bring real and tangible benefits for our companies and economies.

On the political side, a lot of attention was focused on the Middle East region. As Presidency, Finland worked actively in seeking a solution to the Lebanon crisis. In the end, the European Union's contributions both to the formulation of the UN Security Council Resolution and to UNIFIL were significant.

During our Presidency, I had the privilege of discussing the Lebanon crisis and the Middle East Peace Process with many Colleagues from the region, and I look forward to continuing these contacts. We value highly the engagement of the Saudi leadership on these and other regional issues.

Mr Chairman, Ladies and Gentlemen,

Overall, Finland and Saudi Arabia, and the EU and the GCC, share many common interests. The basis for our relations is a mutual respect for the diversity of our cultures, religions and traditions. In Finland, there is a growing interest in learning more about this region, and interest in learning the Arabic language is increasing, as well.

In conclusion, Ladies and Gentlemen, I would like to wish you all, on behalf of the Government of Finland, fruitful discussions at this seminar and the best of success in your business endeavours.

Thank you for your attention.

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Updated 1/15/2007

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