Electrical Equipment and High Technology

Finland Table of Contents

Production of electrical equipment had started somewhat slowly, but during the 1970s and the 1980s the branch grew rapidly. The branch produced both heavy goods--such as power plant generators, heavy-duty electric motors, and equipment for icebreakers--and lighter goods--such as household appliances, lightbulbs, and building components. By the mid-1980s, however, the heavy electrical engineering producers were experiencing stagnant markets and fierce competition. Electronics, however, grew rapidly, expanding its product range from consumer electronics to include computers; communications equipment; and monitoring, control, and measuring equipment. The Finns developed particular competence in control systems for the mining, metallurgical, and forestry industries; computers for hospitals and laboratories; patient-monitoring machines; meteorological installations; and telephone equipment. Finland, which included many areas that were too sparsely populated to allow the construction of a comprehensive telephone network, also was one of the world's leaders in the production of mobile telephones.

Although electronics was still small compared with other industries, many Finns believed that it had good prospects and that it might eventually make up for the impending decline of shipbuilding and other traditional industries. Thus, in the mid1980s , both industry and government began to pay increasing attention to the development of high technology, especially in the electronics industry. The Finns seemed intent on specializing in high-value-added products in which the country had a comparative advantage, an approach similar to that which had proved so successful in other sectors.

The leaders of the electronics industry, aware that the small sizes of their firms made it difficult to compete, banded together to share research and development expenses. The government facilitated cooperation among firms through the Technology Development Center (Teknologian Kehittamiskeskus-- TEKES) established in 1983. Electronics firms were also willing to join international research and development consortia that offered access to foreign technologies. However, despite the rapid development of high-technology electronics in Finland, by the late 1980s it was still too early to predict how well Finnish producers would be able to compete in world markets.

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Source: U.S. Library of Congress