1

Tourism industry sub-sectors

COUNTRY REPORT

FINLAND

March 2014

2

GENERAL OVERVIEW

Data and Figures

Tourism in Finland plays, and will play, a more prominent position in the national economy. During the last years Finland registered only positive figures in tourism, despite the international downturn trends. In 2012, Finland registered an increase in the figures referring to the inbound tourism: national overnight journeys raised by more than 5% and the overall reason for the trip was holidays (55 per cent of the foreign visitors to Finland were on a leisure trip, +10% compared to the previous year).

Direct contribution of Finnish tourism to GDP

Source: WTTC, 2014

At a national, tourism is a subject under the responsibility of the Ministry of Employment and the Economy. The Ministry is in charge of the definition of the priorities for the policies linked to tourism, for the overall implementation of tourism and the harmonisation of actions supporting the sector. In addition to these tasks, the Ministry also deals with the drafting of legislation on the sector and managing all of the issues related to tourism at international level.

Under the control of the Finnish Ministry of Employment is the Finnish Tourist Board, whose principal responsibilities are the promotion of tourism in Finland as well as taking care of the communications with the related industry on the evidence of the sector. As a completion of the overview on the actors involved in the strategy at national level in the sector, it is important to list the following: the MaRa (Finnish Hospitality Association), the Association of Tourism Organisations, the Association of Finnish Travel Agents, the SHKY (Finnish Ski Area Association).

Concerning the allocations reserved for the development and execution of the activities of the governmental bodies above described, the national funding in 2012 was 52 M€ while the allocation for the Finnish Tourist Board was some 10 M€, included the financial support from the private sector. These amounts reflect a general expenditure on tourism of 0,02%, at the level of the Finnish government, mostly used for promotional purposes.

3

The direct contribution of Travel & Tourism to GDP1 was EUR4.4bn (2.3% of total GDP) in 2013, and is forecast to rise by 6.5% in 2014, and to rise by 3.4% pa, from 2014-2024, to EUR6.6bn (2.7% of total GDP) in 2024. The share of GDP linked to tourism represents then a larger share compared to food industry and over twice as high as agriculture’s.

The total contribution of Travel & Tourism to GDP2 was EUR13.2bn (6.8% of GDP) in 2013, and is forecast to rise by 5.1% in 2014, and to rise by 3.3% pa to EUR19.2bn (7.7% of GDP) in 2024.

Travel & Tourism investment3 in 2013 was EUR1.1bn, or 2.9% of total investment. It should rise by 0.2% in 2014, and rise by 3.6% pa over the next ten years to EUR1.6bn in 2024 (3.2% of total).

Main Tourism Offer

Cultural/religious tourism

Winter sports

Adventure tourism

Eco-tourism

Cruising

Labour Market Trends

The Finnish tourism sector directly4 supported 57,500 jobs in 2013, representing some 2.3% of the entire workforce in Finland. The forecast for the next years indicate an expected rise by 5.7% in 2014 and rise by 2.6% pa to 79,000 jobs (3.1% of total employment) in 2024 of employees directly involved in the sector.

Direct contribution of Finnish tourism to Employment

Source: WTTC, 2014

1 WTTC, Travel & Tourism – Economic impact 2014 - Finland

2 WTTC, Travel & Tourism – Economic impact 2014 - Finland

3 WTTC, Travel & Tourism – Economic impact 2014 - Finland

4 WTTC, Travel & Tourism – Economic impact 2014 - Finland

4

As a reflection of the previous paragraph, the aggregate input of tourism to the employment in Finland overcomes 179.000 employees, reaching a level of around 7.1%, of the overall figure of occupation. Also in this case, the forecasts for 2020 are positive, even if in a less powerful way: the previsions for indirect employment in the sector will rise by 4.0% in 2014 to 186,000 jobs and rise by 2.1% pa to 229,000 jobs in 2024 (9.0% of total).

As for many other Countries in Europe, the Finnish employment feels the effect of seasonality of the sector. To tackle this issue the Finnish government created two specific initiatives: Outdoors Finland and Culture Finland. Both of the mentioned projects are aimed at the reduction of the negative effects of seasonal jobs by extending the offers in tourism provided by Finland with activities during the whole year.

The Tourism and Experience Management Cluster Programme integrates the expertise of the leading tourism and experience management centres of research and innovation in Finland. The main objective of the project is to support the renewal of the tourism industry through the intensification of knowledge sharing among companies, regions and research centres in Finland, supported the renewal of the tourism industry. In 2012, over 1000 companies participated in the activities to develop their service offering and business.

Education and Training

The Finnish education system comprises pre-primary education, basic education, general upper secondary education and vocational education and training, as well as higher education provided by polytechnics and universities. Adult education and training is available at all levels, with the exception of pre-primary education. Students’ eligibility to move from one level of education to the next is guaranteed by legislation.

In Finland, the policy for the education of adults is structured in order to offer the largest possible array of prospect in the educational field. A wide selection of training courses and educational programmes are offered by several organisations with a specific reference to adult formal learning at all level as well as the widespread delivery of adult education.

The Finnish National Board of Education, with the cooperation of the most important employers’ organisations at national level, employers’ trade unions, education trade unions and students’ trade unions, is currently developing a project for the revision of the vocational qualifications and of the national curricula.

The Vocational upper secondary qualification: vocational institutes, vocational special education institutes and adult education centres all provide vocational education. A vocational upper secondary qualification gives the basic skills needed in a particular profession.

The vocational education/training comprises a period of time to be devoted to learning on-the-job, when students acquire knowledge and skills through practical projects and tasks essential for the occupation and acquire the key skills of the profession as defined in the curricula.

Completing the qualification takes roughly three years. Vocational institutes provide many fields of study, one of them is “tourism, catering and domestic services”.

In 2012, a document was released on expectations of long-term needs in the country for labour and educational demands. The document included an estimation of data concerning the request for labour until 2025 as well as intake needs for education and training included tourism sector data.

5

The Tourism and Experience Management Cluster Programme, financed under the umbrella of the European Social Fund, provides strategic capacity for entrepreneurs by offering tools for innovation at regional level, that contains ready-made operational prototypes and networks for the national and inter-national markets.

The Master Degree Programme in Tourism: the programme provides students with a comprehensive understanding of current trends such as rapid globalization, continuous change, technology and sustainability and topical issues in tourism. It is designed especially for experts in travel intermediaries and retailing, tour operating, transportation, travel management, and tourism and service organisations. The Degree Programme of Tourism leads to a Master degree in Hospitality Management.

Trends and Prospects

In 2007, tourism businesses employed a total of 130,500 people, generating approximately 4 billion euro per year in tax revenues and accounting for 3.8 per cent of GDP. By implementing the measures proposed in the strategy, tourism businesses could employ 229,000 people by 2024, generating 7.5 billion euro in tax revenue, and accounting for 7.7 per cent of GDP.

The Finnish Tourism Strategy 2020’s leading principle is based on bolstering the acknowledged strengths of Finland’s tourism, while helping growth-oriented, networked companies in tourism clusters to succeed. Since government finances will be extremely limited over the next few years, the strategy restricts itself to proposing indispensable objectives and measures.

The strengths of tourism in Finland include the country’s unique location next to Russia, its attractive travel destinations/tourism areas (e.g. Helsinki, the Turku Archipelago, Finnish Lakeland, and Lapland) and the diverse services offered by tourism clusters. Weaknesses include accessibility in general, unfamiliarity and high prices.

The strategy divides objectives and measures into three categories: internal development of the tourism sector, improving Finland’s image as a tourist destination and enhancing the general industrial policy base.

Key objectives within the tourism sector include strengthening tourism clusters and networks, supporting the growth and development of enterprises, and improving the infrastructure of tourism areas. These objectives and measures are related to tourism industry financing and its targeting. On the one hand, financing should be targeted more intensely at growth-oriented and networked businesses in tourism clusters. On the other hand, it should be targeted at infrastructure improvement projects serving the entire tourism industry.

6

SUBSECTORS

In the following tables we will synthetize some significant data and information about Adventure, Cultural and Blue tourism in Finland.

ADVENTURE TOURISM IN SUMMARY

Overview

Finland offers a wide variety of activities for tourists looking for adventure experiences both in summer and winter time.

Finland, as most of the other Countries in Europe, has seasonal peaks of tourists in summer, especially coming from Russia. In that season, the main attractions for adventure tourists are represented by water sports, thanks to several large lakes and their excellent water quality. Also walking is one of the most popular activity in summer, especially in thick pine forests. In wintertime, apart from the cross-Country skiing, it is the Lapland area that attracts the most, as it is linked to the tradition of Santa Claus.

For 24% of the 2.5 million EU27 citizens who travelled to Finland in 2011 the main reason for going on holidays in 2011 was nature (mountain, lake, landscape etc).

Main services and products Biking and mountain biking Trekking and hiking

Canoeing ,Kayaking and white water rafting Jet skiing Skiing and snowboarding Snowmobiling Husky / Reindeers sledding

Trend and prospects

Among the trends in the adventure tourism in Finland, it is important to highlight the following projects:

The Ministry of the Environment and the Ministry of Agriculture and Forestry promote the tourism development of the national urban parks and national parks.

The National Forest Programme (NFP) of Finland aims to ensure forest-based work and livelihoods, biodiversity and vitality of forests, and opportunities for recreation for all citizens.

The recently ended project aims at reducing the seasonality of tourism in Finland by promoting the development of new offering called “Outdoors Finland”. The project aimed to improve the quality and accessibility of routes for cycling (particularly touring cycling), trekking, hiking and canoeing for independent tourists from both Finland and abroad, and for business. It was created a specific portal for marketing and advertising alternative activities to implement in Finland in the summertime.

7

CULTURAL TOURISM IN SUMMARY

Overview At the moment, as confirmed from 2011 data, culture is an important factor in Finnish tourism. For

15% of the 2.5 million EU27 citizens who travelled to Finland in 2011 the main reason for going on holidays in 2011 was "culture/religion".

The Ministry of Education and Culture set up a programme promoting product development for the purpose of cultural tourism for the time period of 2009-2013. The experience provided must draw on the unique features of the cultural identity: heritage, customs, lifestyles and values that convey an impression of the Finnish culture to the tourist. Programme is based on and supports the Government Resolution on Finnish Tourism Policy, the Finnish Tourism Strategy up to 2020 and the proposal for a Finnish cultural exports development programme for 2007-2011.

According to the Finnish tourism strategy 2020 cultural tourism resources include all that has been created or moulded by people: history, cultural landscapes, built environment, archaeological sites, museums, performing arts, visual arts, events, handcraft, language, tastes, traditions, mores, ideas, lifestyles, religion, human characteristics, and scientific, artistic, technological and industrial achievements.

Main services and products Museums Festivals

Exhibitions Visits to Finnish heritage attractions (as of 2012, 7 sites)

Trend and prospects

Finland is investing in the development of projects aimed at boosting the offer of cultural tourism, among which:

A project charting cultural heritage sites in forests owned by the state - the largest individual cultural heritage field survey project ever carried out in Finland.

Culture Finland5, a national umbrella programme for cultural tourism which began in January 2011. The programme is funded by the Ministry of Education and Culture and is steered by the Finnish Tourist Board. In 2011, the programme was administered by Finland festivals, an organisation concentrating on collaborative activities in the culture and tourism sectors.

The main goal of the programme is to generate greater co-operation between the different actors in the culture and tourism sectors, and to create a functioning national network for cultural tourism. The aim is to promote the development of quality tourism products and services based on Finnish culture and art, and strengthen international coverage of Finnish culture.

“Contemporary old city: Enhancing cultural tourism across the border”6 is aimed at increasing tourist attractiveness and promotion of historical and cultural centres and activities in Petrozavodsk and Joensuu, and in the respective regions. A single, easily accessible platform (portal) for the information related to cultural and historical sites relevant for tourism has been formed for the

5 http://www.mek.fi/tuoteteemat-ja-tyokalut/tuoteteemat/kulttuurimatkailu-culture-finland/

6 http://www.kareliaenpi.eu/fi/teemat/tourism-cooperation/hankkeet/246

8

whole project area. New marketing material related to the project cope is developed, and some pilot events are used to complement the annual events calendar of the cities and to market the cultural and historical touristic offer of the region. The travel agencies will be involved in the marketing of the events, and to develop further cross-border tours related to culture, history and events. The joined marketing plan elaborated within the project will guide the marketing actions.

BLUE TOURISM IN SUMMARY

Overview In Finland, blue tourism represents an important aspect of the tourism: over 350,000 cruise

passengers visited Finland in 2011, bringing some €34 million to local economies. Additionally in 2011, the cruise industry generated 3,408 jobs and €232 million in direct spending in Finland. Finland’s Viking Line and Tallink control over 60% passenger traffic and 75% market share by revenues of the Eastern Nordic and Baltic regions7.

The traditional coastal tourism product is not of major importance to the economy and very seasonal due to the climate. On the other hand, it must be kept in mind that most of the largest cities of the country are located on the coast (e.g. Helsinki, Turku and Oulu).

Finland has 32 canals with locks that are maintained by the Finnish Maritime Administration: Saima Canal, from Lake Saima to the Gulf of Finland, is the biggest and the most important. There are plenty of routes for pleasure boats and there is an extensive traffic of tourists ships on the Finnish lakes and canals (also to connect the islands around Helsinki and the country). More than half a million passengers use the tourist boats on the inland waterways every year, making boating an important business related to Blue Tourism.

Main services and products

River cruising Sea cruising Fjord cruising

Trend and prospects

The Flagship Project main scope is to attract tourists to rural areas especially the coastal ones by promoting joint sustainable rural and coastal tourism packages (e.g. farm, food tourism, hiking, winter sports, nature based tourism) and by creating a tourism network made of actors from the tourism sector, research and education, local and the public sector.

Finland participates in some significant projects related to sustainable approach to tourism as well as cross-Country-activities and agreements. Green Tourism Finland is a network of companies which are dedicated to sustainable development. Members include (among others) transportation, accommodation and tours.

7 Finnish Tourist Board

9

The EU Strategy for the Baltic Sea Region is aimed at maintaining and reinforcing the attractiveness of the Baltic Sea Region through the implementation of the cooperative actions and flagship projects. The Baltic Sea Tourism Forum is made of Representatives of the Baltic Sea neighbouring countries (Denmark, Estonia, Finland, Latvia, Lithuania, Poland, Russia, Sweden and Germany) in order to inform each other about current tourism developments in their countries and to discuss possible cooperation strategies

REFERENCES EUROPEAN COMMISSION, Survey on the attitudes of Europeans towards tourism - Flash Eurobarometer 334, 2012 FINNISH MINISTRY OF EMPLOYMENT AND THE ECONOMY, Government resolution on Finnish tourism policy, 2011 FINNISH MINISTRY OF EMPLOYMENT AND THE ECONOMY, Finland’s Tourism Strategy to 2020, 2013 OECD, Tourism and Trends policies 2012 Finland, 2012 STATISTICS FINLAND, Border Interview Survey, 2013 WORLD TRAVEL & TOURISM COUNCIL, Travel & Tourism Economic Impact 2012 - Finland, 2012 WEF, The Travel & Tourism Competitiveness Report 2013, 2013 WTTC, Travel & Tourism – Economic impact 2014 – Finland, 2014