History of Finland – Guide to Finnish History

Main outlines of Finnish history

Paleolithic History

Presently there are ongoing excavations in Ostrobothnia, in what is called the Wolf Cave in Kristiinankaupunki, or Kristinestad in Swedish. If confirmed, this site will be the oldest archeological site in Finland, and is likely to be the only Neanderthal, or pre-glacial, site found so far in the Nordic countries, around 130,000 years old.

The land area now known as Finland was first inhabited just after the Ice Age, from around 8500 BCE. In this section we will give a brief outline of the main periods of history of Finland from then onwards.

Suomusjärvi culture (8300-5000 BCE)

The first traces of homo sapiens in Finland are post-glacial and date from around 8,500 BCE. The period following their arrival, which saw an increase in population, is known as the Suomusjärvi culture. These people were most likely seasonal hunter-gatherers. At the beginning of the 20th century, under a layer of peat, a Neolithic, or Stone Age, site was discovered in Antrea on the Karelian Isthmus, less than 200km north of St. Petersburg. Among the items found was the net of Antrea, which is one of the oldest fishing nets ever excavated, as well as wood and flint implements, polished instruments of shale, remains of nettle fibres, 16 fishing floats of piney bark, 31 stone plummets, and a long bone dagger. Elsewhere in South Karelia around 20 dwelling sites were discovered, although to date few of these archaeological findings of Finnish history‘s excavations have been studied. Among the artefacts found at these dwellings are stone spearheads shaped like willow leaves, chisels and axes, which indicate that the inhabitants hunted and fished to survive.

The Corded Ware culture (3200/2900-2300/1800 BCE)

The Corded Ware, or the Battle Axe, culture began in the late Neolithic (Stone Age), and flourished throughout the Copper Age culminating in the early Bronze Age. This period in History of Finland is also known as the Single Grave culture due to the shared practice of single burial under barrows, where the deceased was usually accompanied by a battle axe, amber beads and pottery vessels. It was during this period that the use of metal was introduced to Northern Europe. The Corded Ware culture was a mixed agrarian and hunter-gatherer culture.

The Iron Age

The earliest discoveries of Finnish ironwork and imported iron blades have been dated to around 500 BCE. There are indications that the exchange of goods over long distances began in coastal areas of Finland began around 50 AD, when local inhabitants began to trade their wares, most likely furs, for weapons and ornaments with Scandinavians and Balts, as well as with folk along the more traditional trade routes to the East. There existed in Finland at this time a chiefly elite, as can be seen from the many burial grounds that were richly furnished in some parts of the country.

It was towards the end of the Iron Age, and during the early Medieval Age, that there was a spreading of hillforts across the southern regions of Finland. Linguists believe that it was likely that during the Iron Age the three main dialectal groups of Finnish speakers emerged. These are the Finns, Karelians and Tavastians. Excavations in the Åland Islands have shown that the archaeological culture of the islands had a decidedly more Swedish character than the mainland, which would suggest Scandanavian settlement.

The Middle & Viking Ages

Finland was one of the very last places in Europe to have Christianity introduced, where the first influences appear, based on etymological evidence, to have come from the East and the Orthodox tradition. The first signs of Christianity are found in burial sites dated to the 11th century, when objects with obvious Christian connections were found, including crucifixes and swords with Latin engravings such as ‘In nomine Domini’ and ‘Dominus Meus’. As would become a noticeable theme throughout the rest of Finland’s history, the country found itself positioned between two cultures destined to clash – the Russian christians who followed the Greek Catholic (or Orthodox) faith and Sweden which was loyal to the Catholic Church of Rome. There had already been considerable contact between Finland and Sweden before Christianity; the Finns were in contact with the Vikings both through trade and the Vikings invariable habit of plundering. The evidence of this trade is plentiful in archaeological digs, and includes silver coins from the Arabian peninsula as well as weapons and jewelry. However, there is no evidence of any Viking settlements on the mainland, although archaeological evidence proves that they settled on the Åland Islands.

Finland and the Finns were mostly unknown to Europeans during the Viking Age, with the exception of Swedes and Gotlanders, who would have known that Finns and Saami were different races. During this time the vast majority of Finns lived in the south of the country, in coastal settlements and along the shores of the numerous inland lakes. Eastern and Northern Finland were home to more nomadic peoples who continued the hunting and fishing traditions of the first settlers. These people may have been the ancestors of the Saami, or of some branch of widespread Finno-Ugrians.

Agriculture also developed in Finland during the Viking Age, with the cultivation of cereals such as wheat, rye, barley and oats beginning then. Near Turku, in Eura, where most of the richest Viking Age remains have been found, evidence of permanent fields has been discovered, but mainly the practice was to slash and burn. Archaeologists also were able to discover that Finns of this time of Finnish History kept the usual domestic animals – cattle, pigs, goats, sheep and horses. In some graves dogs have been buried with their owners, but no trace of any cat has been found so far. From the graves it is also clear that the bear played a signal role in the culture of that time; bears claws and teeth are found in the cremation cemetaries, and bears’ teeth and pendants fashioned in bronze have also been found on the clothes of buried women, and on chains worn by them.

The Kalmar Union

Between 1397 and 1523 Scandanavia was united politically for the only time in its history under the crown of Denmark, as the Kalmar Union. The Union was the brainchild of Queen Margaret of Denmark, founded to give Denmark, Sweden and Norway a united front against German encroachment. Queen Margaret had gained the Norwegian crown through marriage, and had ousted an unpopular German king in Sweden by forming a strategic partnership with the Swedish nobility who had revolted.

The Kalmar Union was ever a tentative union, conflict and disagreement between the Danish monarchy and the Swedish nobility (who controlled Finland at the time) was rife. This period was one of frequent warfare between Denmark and Sweden, and within Sweden itself there was a continual struggle for power by competing nobility attempting to take hold of the Swedish crown. As a result of this struggle Finland was to suffer heavily, mostly from taxation by the Swedish nobility, but also because of wars fought on its soil and from a persistent disruption to its trade. Sweden diverted resources from the country’s eastern borders which left Finland open to attacks from the Grand Duchy of Muscovy, which was expanding and would eventually become the Russian Empire. In 1478 Grand Duke Ivan III had taken control of Novgorod, which brought the might of Muscovy up to the Finnish border. In 1493, Denmark and Muscovy became allies with the aim of engaging Sweden in war on two fronts, and two years later Finland was invaded by Muscovite forces. In 1497 Sweden and Muscovy made peace, and the borders of 1323 were reinstated.

By 1523 Sweden had become a seperate state thanks to a revolt against the Kalmar Union led by Gustav Vasa, a Swedish nobleman, who became King Gustav I and founded a dynasty that would rule Sweden and Finland for over 100 years.

The Club / Cudgel War (1596)

In 1596 the peasants of Finland revolted against Swedish exploitation. They had become tired of the hardships they had been forced to endure the Russo-Swedish War of 1590-1595, and further enraged when they discovered that they would have to continue supplying the Swedish army with food, lodging and transport even after the Treaty of Tyavzino had been signed. To make matters worse, there were allegations that the Swedish military were abusing the taxation system by taking more than they were entitled to by force.

The war that ensued was named after the fact that the peasants couldn’t afford Zweihander swords, lances, muskets or horses, and instead armed themselves with blunt instruments such as cudgels and maces. They succeeded in capturing Nokia manor and won a number of skirmishes against small cavalry forces, but were then defeated by Cas Fleming on January 1st and 2nd of 1597. The leader of the peasant revolt, Jaako Ilkka, was captured towards the end of January and executed. A second wave of insurgents were defeated on February 24th at Ilmajoki in the Battle of Santavuori. In total, some 3,000 people died during the insurgency, mostly peasants from the regions of Ostrobothnia, Northern Tavastia and Savo.

The Great Northern War and The Greater Wrath (1700-1721)

The Great Northern War began in 1700 when the Northen Alliance, a coalition comprised of Russia, Denmark-Norway, Poland-Lithuania, and Saxony launched an attack on Sweden for control of the Baltic Sea.

Peter the Great’s galley navy successfully captured a small detachment of the Swedish navy in 1714 near the Hanko peninsula, which was the first Russian naval victory of the war. Between 1713 and 1714 the Russian army occupied most of Finland, having already taken the city of Vyborg in 1710. Finnish troops made their last stands in the battles of Pälkäne in 1713 and Napue in early 1714, in Isokyrö, Ostrobothnia. The military occupation of Finland by Russia that followed lasted until the treaty of Nystad, signed in 1721, and is known in Finland as the Greater Wrath.

Following the Russian victory at Isokyrö, Mikhail Golitsyn bacame governor of Finland, and the Finns began to wage a partisan war against the occupiers. The Russian military retaliated by forcing Finnish peasants to pay large contributions to them, and plundering began to become widespread, especially in the region of Ostrobothnia and those communities located near to the major roads, with many churches being looted. Isokyrö was burned to the ground, and the Russians instigated a scorched earth defence zone where an area several hundred kilometres wide was burned to hinder any Swedish counteroffensive.

During the Greater Wrath some 5,000 Finns were killed and around twice that number taken as slaves, the vast majority of which would never return. Thousands of Finns, mostly the ruling elite, bureaucrats and officials fled to the relative safety of Sweden, leaving the poorest peasants to flee into hiding in the forests in order to escape the occupiers and their press-gangs. Between 1714 and 1717 atrocities were at their worst as the Swedish Count Gustaf Otto Douglas was in charge of the occupation, having defected to the Russians during the war. It is also worth remembering that Finland had had to endure the plague just as the Great Northern War began, with Helsinki alone seeing two-thirds of its population die in 1700 alone. In 1721 the Treaty of Nystad and the Stockholm treaties were signed; this saw Russia become the new major power in the region, and an emerging political force in Europe.

The Russo-Swedish War (The Hats War) (1741-1743)

During the Swedish ‘Age of Liberty’ (1719-1772) a political faction known as the Hats became active. The Hats ruled Sweden from 1738 to 1765, and their foreign policy would lead the country into two costly and disastrous wars, the first being the Russo-Swedish War, known as the Hats War in Finland, from 1741-1743. This war would lead to the Lesser Wrath, or the re-occupation of Finland by Russia.

Sweden declared war on Russia on August 8th, 1741, after deploying some 8,000 troops, both Swedish and Finnish, along the border of Russia near the fortress town of Lappeenranta. The aim was to threaten Saint Petersburg and aid a coup d’état that had been engineered by French and Swedish diplomats. By December the coup had been successful, but the new Tsarina, Elizaveta Petrovna, was taking advice from Aleksey Bestuzhev, her pro-Austrian chancellor, and reneged on her promises. Instead she chose to continue the war with Sweden.

Key to her decision was her certain knowledge that there had been no threat to Saint Petersburg since September. The Tsarina’s army was commanded by Field-Marshal Peter Lacy, an Irishman from Limerick who became one of the most successful Imperial commanders before the rise of Rumyantsev and Suvorov. In September he had advanced on Lappeenranta with 20,000 troops and inflicted a major defeat on Lewenhaupt, the Swedish commander. Forced into retreat, Lewenhaupt was helpless to prevent Lacy capture Porvoo and Savonlinna. He finally encircled the entire Swedish army near Helsinki, forcing their surrender and effectively bringing the hostilities to an end.

With the Swedish army having surrendered, the Russian army entered Turku (then the capital of Finland), and Rumyantsev and Nolken negotiated a peace settlement. Under its terms the Tsarina would evacuate her army from Finland and Adolf Frederick, who was the uncle of her own heir apparent, would be named as heir to the Swedish throne. Even as the negotiations were ongoing, the Russian Baltic Fleet destroyed a Swedish flotilla off the coast of Korpo Island, and Field-Marshal Lacy set off from Kronstadt to invade Sweden. He received word that the Treaty of Åbo had been signed just as his fleet bore down on Umeå. Under the treaty, Sweden ceded a strip of Finland that included Hamina and Lappeenranta which was added to those territories Russia had already gained under the Treaty of Nystad in 1721.

War of Finland 1808-1809

The War of Finland was to be the last war Sweden would fight, and brought to an end its influence in Europe.

Ironically, the War of Finland had very little to do with any problems that Sweden had with Russia when it first began, but was more to do with the European struggle for political power, especially the struggle between Britain and its historical enemy, France, now led by the Emperor Napoleon.

Napoleon ruled Europe and prevented the British from entering European ports. However, the British still had access to Swedish ports and continued to trade with continental Europe via Sweden. Russia had previously fought a war with the French Empire which had left it considerably weakened, and Napoleon was able to persuade Russia to become an ally, which made most of continental Europe powerless. Napoleon used his influence to persuade Tsar Alexander to force Sweden to close its ports to the British, and tried to get the Swedish king to join Napoleon’s Continental System. King Gustav IV was wary of how this would effect Sweden’s maritime commerce, on which it relied heavily, and instead chose to enter into negotiations with Britain who had traditionally been an ally of Sweden. They prepared to launch a joint attack on Denmark, with the King seeking to take the Dane’s Norwegian possessions.

However, Sweden was overly optimistic about its chances of surviving a Russian attack. Tsar Alexander took Sweden’s refusal to close its ports to the British as an excuse to invade Finland. On February 21st 1808, almost 2 months before war was declared, 24,000 Russian troops crossed into Finland and captured Hämeenlinna. By the end of the following month the Russians had taken Kuopio, Tampere, Jakobstad, Svartholm (Loviisa), Helsinki, and Hanko; and had landed in Gotland and the Åland Islands.

Despite this, Sweden didn’t fold and instead King Gustav appointed a new commander, Carl Johan Adlercreutz who immediately launched a counter-attack which halted the Russian advance. In Finland the upper classes sided with the Russians, but the peasantry fought a guerilla war in many areas of the country, and in Hamina were led by the capable Colonel Sandel. On April 18th at Siikajöki Russian forces were defeated and two weeks later suffered the same at Revolax. A Swedish flotilla forced the garrison on the Åland Islands to surrender, having been aided by locals, and having already driven the Russians from Gotland. 14,000 troops had been sent by Britain to Gotenburg, but left for Spain instead after a dispute with King Gustav. They left behind 36 ships for Sweden to use, 16 of which were battleships.

The Russians were driven from Central Finland by August, and forced to stretch a line from Mikkeli to Pori, via Tampere. However, their troops were soon reinforced, and once again they had a numerical advantage: 55,000 to Sweden’s 36,000. Sweden won the Battle of Jutas in September, but lost battles at Oravais, Salmi and Kuortane. At the same time, Russia was effectively dealing with the partisan movements in the east, which made things considerably easier for them in the south. As Sweden found itself trying to protect its borders with Denmark and Norway, it was forced to remove troops from Finland, and by the winter of 1808 Russia had taken all of the country.

In early spring of 1809 Russian troops crossed the frozen Gulf of Bothnia and invaded Sweden, landing just 70km from Stockholm on March 19th, and entering Umeå just 5 days later. By the 25th a third force had encircled Tornio and forced its surrender. King Gustav was dethroned and replaced by his uncle who was proclaimed King Charles III. The new king negotiated a truce with the Russian commander in chief, Boris Knorring. However, Tsar Alexander arrived in Turku on March 31st, and upon hearing of the truce replaced Knorring with Barclay de Tolly, and revoked the truce. Shuvalov’s forces, which had captured Tornio, reached Umeå in May, and the Russians engaged the Swedish forces at Savar and Ratan. Although these battles were inconclusive, Sweden entered into negotiations for peace in August, and on September 17th, 1809, signed the Treaty of Fredrikshamn.

Sweden ceded all of Finland and part of Lapland east of the Torne river under the treaty, closed its ports to British ships, and joined Napoleon’s European Continental System. Russia attached areas previously ceded by Sweden and formed the Grand Duchy of Finland. The Gustavian constitution of 1772 was retained, with some minor alterations, and Finns were promised that they could retain their Lutheran religion. The Tsar elevated Finland to the status of a nation among nations, and they were relieved of military duty. For the first time in its history, Finland was able to develop its own government, and set up the new centre of administration in Helsinki, around Senate Square.

The Finnish Declaration of Independence (1917)

‘The people of Finland have by this step taken their fate in their own hands; a step both justified and demanded by present conditions. The people of Finland feel deeply that they cannot fulfil their national and international duty without complete sovereignty. The century-old desire for freedom awaits fulfilment now; Finland’s people step forward as a free nation among the other nations in the world.’

On the December 6th 1917, the Finnish Declaration of Independence was adopted by the Parliament of Finland. It declared Finland an independent and sovereign nation-state rather than an autonomous Russian Grand Duchy.

Hopes for indendence in Finland had been ignited by the February Revolution of 1917 in Russia, when Grand Duke Nicholas II abdicated. His abdication on March 15th was interpreted in Helsinki to signal the end of the legal basis for the personal union between Finland and Russia. The October Revolution heightened those hopes, and on November 5th, the Finnish Parliament declared itself to be ‘the possessor of supreme State power’ in Finland, basing the declaration on article 38 in the old Instrument of Government of 1772, which had been enacted by the Estates following the bloodless coup of King Gustav III of Sweden.

10 days later, on November 15th, the Bolsheviks declared a general right of self-determination, which included the right to secede, ‘for the Peoples of Russia’. This prompted the Finnish Parliament to issue a declaration by which it assumed, pro tempore, all powers of the Sovereign in Finland. However, the old Instrument of Government was no longer deemed suitable. Finland’s leading circles had long considered that monarchism and hereditary nobility were antiquated concepts, and instead advocated a republican constitution.

Parliament had appointed a new government in November, the Senate of Finland, and it returned on the 4th of December with a proposal for a new republican Instrument of Government. The Declaration of Independence was technically given the form of a preamble of the proposition, with the intention that it be agreed by the Parliament. On December 18th, the new Soviet government issued a Decree which recognised Finland’s independence, and this was approved by the highest Soviet executive body, the VtsIK (All-Russian Central Executive Committee) on December 22nd. Finland was now recognised as an independent nation.

The Finnish Civil War (Jan 27 – May 15, 1918)

Of all the conflicts Finns have been involved in throughout history, the Finnish Civil War remains the most contentious and controversial even today. It was fought by the forces of the Social Democrats, led by the People’s Deputation of Finland, commonly known as the ‘Reds’, and the forces of the non-socialist, conservative-led Senate, commonly called the ‘Whites’, led by former tsarist general, Carl Gustaf Emil Mannerheim. Support for Reds came from the Russian SFSR, while the German Empire provided military assistance to the Whites.

Following the February and October revolutions, the Russian Empire collapsed and there was a similar breakdown in Finnish society wherein the Social Democrats and the conservatives competed for control of the Finnish state, with both sides collaborating with corresponding political forces in Russia, further deepening the split in Finnish society. With no accepted police or army forces in Finland to keep order, the opposing sides began to build their own independent armed military groups, the White and Red Guards. By January 1918 fighting had broken out, and begun to spiral, with the White Guard finally overcoming the Social Democrat forces. Control of Finland passed to a German hegemony until December 1918 when Finland emerged as an independent, democratic republic.

By the end of the Civil War, almost 37,000 people had died, less than 10,000 of them in battle. Far more died in political terror campaigns and in the prison camps where there were very high mortality rates. When the Civil War was over the country was in turmoil, its economy destroyed, its political appartus and its people divided. The country was slowly reunited through compromises of moderate political groups on both the left and right.

The Winter War (30 November 1939 – 13 March 1940)

On the 30th of November, 1939, Russia attacked Finland with 21 divisions and some 450,000 soldiers, leading to its expulsion from the League of Nations on December 14th. Finnish forces were heavily outnumbered, Russia had four times as many troops, thirty times more aircraft, and over six thousand tanks to Finland’s thirty two, yet the Finns were incredibly commited and enjoyed excellent morale in the ranks, and managed to resist the invasion with great success for far longer than the Soviets had expected. The purge of the Red Army by Stalin in 1937 had seen almost 50% of army officers executed, and the inexperience of the senior officers was also instrumental in the successful resistance of the Finns.

When the Soviets first invaded, Finland mobilised an army of just 250,000. However, using guerilla tactics and their local knowledge, and aided by extreme winter conditions, these troops proved to be fierce adversaries. By the end of the first month of the Winter War, the Red Army had been humiliated, and Stalin was furious. The Soviet propaganda machine was working hard to explain the Army’s failure to the population, claiming that the Mannerheim Line was stronger than the Maginot Line, and that the U.S. had provided Finland with 1,000 of its best pilots; and blaming the terrain and climate. Meanwhile, the Finns were choosing not to engage the Soviets in conventional war where possible, instead relying on their fast moving ski-troops to attack field kitchens, and the small-unit ‘motti’ tactic where enemy columns were split into smaller pockets, and then dealt with. Initially, Soviet tanks proved to be a problem for the Finns, who were poorly equipped to deal with them, but the use of an incendiary device first used in the Spanish Civil War proved decisive. These incendiaries became known as ‘molotov cocktails’, sarcastically named for the Soviet People’s Commissar for Foreign Affairs, Vyacheslav Molotov, who had claimed in radio broadcasts that the Soviet Union was not dropping bombs on Finland, but was actually delivering food! The Finns began to refer to the bombs as Molotov bread baskets, and when the use of the incendiary devices began these were ‘drinks to go with the bread’.

Finland signed the Moscow Peace Treaty in March 12th 1940, ceding about 9% of its pre-war territory and 20% of its industrial capacity to the Soviet Union. The entire of the Karelian Isthmus, as well as a large amount of land north of Lake Ladoga, was ceded, including Finland’s second largest city of Viipuri. 12% of Finland’s population, around 422,000 Karelians were evacuated and lost their homes. Soviet losses on the front were large, almost 127,000 were dead or missing compared with Finnish losses of around 25,000. This brought into question the ability of the Red Army to fight efficiently, contributing to Germany’s decision to launch Operation Barbarossa.

The Continuation War (25 June 1941 – 19 September 1944)

The second of the two wars fought between Finland and the Soviet Union during the second World War is known in Finland as the Continuation War, which began with exchanges of hostilities on the day the German invasion of the Soviet Union was launched. On June 25th 1941, the Soviets launched an air offensive, prompting the Finns to launch operations on the Karelian Isthmus and Lagoda Karelia. By September, Finland had captured East Karelia, and had undone its post-Winter War cessations.

For the following two and a half years there was a standstill as Soviet and Finnish forces dug themselves in. With the Germans advancing on Leningrad (St. Petersburg), Finland refused to participate actively in the siege of that city, and also to cut the Murmansk railway. The Soviet air force conducted bombing campaigns on Helsinki. Meanwhile, in December 1941, the United Kingdom declared war on Finland, shortly followed by its Dominions, a rare case of one democracy declaring war on another. Although the United States did not fight or declare war on Finland, it sent substantial matériel to the Soviet Union for use in the war effort against Germany and its allies. Germany provided Finland with critical material support and military cooperation.

In the summer of 1944, the Soviets launched a strategic offensive, driving the Finns from most of the territories they had managed to occupy, before reaching another impasse which led to the Moscow Armistice in September. The Continuation War was formly concluded by the ratification of the Paris peace treaty of 1947, under which Finland had to cede a number of territories, including much of Karelia, and to pay the Soviets reparations of $300 million – half of the annual GDP in 1939. Finland did, however, retain its independence. Over 63,000 Finns had died in the war, with almost 160,000 wounded and injured. Soviet losses were far heavier, with approximately 200,000 dead, 385,000 wounded, and a further 190,000 hospitalised due to sickness. In addition, some 64,000 Soviet troops had been captured.

The Lapland War (September 1944 to April 1945)

Once Finland had signed the Moscow Armistice, it was obliged to force German troops from its territories. These hostilities were fought in Finland’s northernmost Lapland Province. During the first few weeks the withdrawal of the Germans was coordinated with the advance of Finnish troops, with the Finns firing on evacuated trenches. However, the Soviets realised the deception, and demanded the Finns engage the Germans in immediate heavy action.
The German forces retreated under General Rendulic, devastating large areas of Lapland with scorched earth tactics, resulting in around 45% of dwellings in the area being destroyed. The city of Rovaniemi was burned to the ground, as were the towns of Savukoski and Enontekiö. By April of 1945 the last German troops had been expelled.

Cold War to present

Finland’s infrastructure and economy had suffered heavy damage because of the wars fought during WWII, and the first order of business for the country was to repair the former, and breathe new life into the latter. As its citizens and politicians began a return to normal life, Finland’s army and navy were busy from the autumn of 1944 clearing the seas and land of mines. The areas worst affected by mines were the Gulf of Finland where mine clearance operations lasted until 1950, Karelia, and Lapland. Many civilian and military casualities were caused by these mines, the worst affected area being Lapland.

The aftermath of the war wasn’t just limited to clearing land and sea of explosives. From July 29th to October 15th, 1946, the Paris Peace Conference negotiated the Paris Peace Treaties, which were signed on February 10th, 1947. On one side stood the Allies, principally the USA, USSR, UK, France and Canada, making demands on Italy, Romania, Hungary, Bulgaria, and Finland. Somewhat surreally, Finland was classified as ‘a belligerent and fascist power’, and had heavy war reparations imposed on it – $300,000,000 to be paid to the USSR, with the soviets also taking the Porkkala area near Helsinki as a military base. Although these reparations were initially considered to be crippling, in fact they provided Finland as a nation to once again show the characteristic ‘Sisu’ which in many ways defines the Finns. A determined effort was made to pay the reparations, and they were paid off many years in advance, in 1952. By 1956 Porkkala had been returned to Finnish control. Indeed, it could be argued that Finland’s efforts to pay the reparations was one of the most significant factors that drove the country to creating a formidable manufacturing base in the post war years.

By 1950 50% of the Finnish workforce were employed in agriculture, with a third living in urban areas. As more new jobs in manufacturing, trade and services appeared more people began to migrate towards the towns. 1947 saw the peak of baby-boom births, the average number per woman peaking at 3.5, and declining to 1.5 by 1973. Unfortunately, as these baby-boomers entered the workplace jobs were not generated quickly enough and hundreds of thousands of Finns were forced to emigrate to their more industrialised neighbour, Sweden, with emigration peaking in 1969 and 1970.

Finland’s position during the Cold War was unique among the countries which had a border with the USSR. Unlike others, it remained independent, and although for economic reasons it was influenced by the Soviet Union, Finland retained its democratic structures and market economy. Under pressure from Moscow, Finland signed the YYA Treaty with the Soviet Union in 1948, which was called the Agreement of Friendship, Cooperation, and Mutual Assistance. Theoretically the treaty guaranteed mutual assistance, but in general terms the soviets respected Finland’s desire to remain uninvolved in the Cold War, as can be seen by Finland’s purchases of arms which were balanced between East and West until the collapse of the Soviet Union. This treaty was abrogated by Finland since the 1991 dissolution of the Soviet Union.

In 1952 the Nordic Council was formed by Norway, Denmark, Sweden and Iceland. Finland was free to join in 1955, following the death of Stalin and a thaw in their relationship with the USSR. The Nordic Council had established a passport union, which allowed their citizens to cross borders without passports and afterwards to apply for jobs and claim social security benefits in the other countries. However, by the 1980s Finland’s wages and standard of living were comparable with Sweden, and the reasonably rapid rise of their economy resulted in the setting up of another Nordic-style welfare state. The same year that Finland joined the Nordic Union it also became a member of the United Nations, although it had already been associated with a number of specialised organisations with the UN.

In 1961 Finland became an associate member of the EFTA (European Free Trade Association) and a full member in 1986. Finland agreed a trade agreement with the EEC as well as another with the Soviet Bloc. In 1972 and 1973 Finland hosted the first Conference for Security and Co-operation in Europe, and on the 1st of August 1975 the Helsinki Final Act was signed. The CSCE was considered to be a means of reducing the tensions of the Cold War in Europe, and was thought to be a personal triumph for President Urho Kekkonen. The CSCE eventually led to the creation of the Organisation for Security and Co-operation in Europe, in the 1990s.

In 1991 Finland faced its greatest post-war challenge when it fell into a depression, due to a combination of local and global factors. The catalyst was the collapse of the Soviet Union which saw a market that had accounted for 20% of exports vanish almost over night, but there were also sharp cycles in the OECD area, and exports in general were down. However, external forces would merely have resulted in recession, had the country not previously put in place bad policies, the most detrimental of which was the poorly designed financial and banking deregulation of the 1980s. The growth in the ’80s had been based on borrowing, and had caused a bubble: when the bubble burst GDP declined by 15% and unemployment rose from near full employment to 20%. The government struggled to rein in public expenditure and public debt rose to almost 60% of GDP. Around 7-8% of GDP was needed to bail out the banks, and force consolidation in the sector. The Finnish currency, the Markka, was floated, and considerably devalued. However, by 1993 the depression had bottomed out and the country began to slowly recover.

Finland in the 21st Century

So, how is Finland today? One way of evaluating the country is to see how it is viewed from elsewhere.

The 2005 Environmental Sustainability Index (the last ESI published) ranked Finland first out of 146 countries. The ESI was produced by a team of environmental experts from Yale and Columbia Universities in the US. Finland’s excellent ranking was attributed to substantial natural resource endowments, low population density, and successful management of environment and development issues.

In 2009 researchers at the Gallup World Poll attempted to discover the countries where people were happiest, and surveyed thousands of respondents in 155 countries over a four year period. The resulting data placed Finland in 2nd place, just behind Denmark but ahead of Sweden and Norway.

In 2009 the Legatum Institute, a think-tank based in London, published a report that Finland was the most prosperous nation in the world, not solely in monetary matters but also in the quality of its democracy and governance.

Figures from the United Nations Education Index published in 2009 ranked Finland 2nd in the world, behind Korea. This index is measured by the adult literacy rate and the combined primary, secondary, and tertiary gross enrollment ratio. The adult literacy rate gives an indication of the ability to read and write, while the gross enrollment ration gives an indication of the level of education from kindergarten to postgraduate education.

Finally, in August of 2010, Newsweek published its list of the best countries in the world to live in, averaging the results from five categories measuring national well-being. The categories were education, health, quality of life, economic competitiveness, and political environment. Finland topped the list, ahead of Switzerland and Sweden.