World Class Eco Systems and Competitive Business Environment

Business Finland has asked Copenhagen Economics to address the following questions:

• How have Business Finland’s invest-in activities succeeded to attract foreign investments that increase renewal of companies in the Finnish business environment and will do so in the future?
• How have Business Finland’s funding and services succeeded to build trial platforms and ecosystems in Finland will do so in the future?

Overall, we find indications that the invest-in services have helped bringing new FDI to Finland, but we also find that there is a potential for Business Finland to focus the investment promotion more towards Finnish strongholds and more proactively pur-suing clients.

Strong ecosystems are a key driver of FDI. We find that Business Finland’s funding of ecosystem development has a positive and significant impact on employment and turnover in the SMEs and start-ups that receive funding. Funding from Business Fin-land for SMEs increases employment by around three employees in the average sup-ported firm. It is estimated that the investment programmes have a payback time between seven and nine years.