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R 251308Z SEP 07
FM AMEMBASSY HELSINKI
TO RUEHC/SECSTATE WASHDC 3779
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE

UNCLAS HELSINKI 000726 
 
SIPDIS 
 
STATE FOR EB/TPP/ABT/GARY A CLEMENTS AND EUR/NB 
STATE PLEASE PASS TO USTR/CAROLYN MILLER 
COMMERCE FOR ITA/OTEXA/MARIA D'ANDREA 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ECON ETRD KTEX FI
SUBJECT: FINLAND - TEXTILES AND APPAREL PRODUCTION 
UPDATE 
 
REF: SECSTATE 114799 
 
¶1. Following is 2006 data for Finland (1 EUR=1.25 
USD) keyed to ref request: 
 
--Total inustrial production: 159.9 billion USD 
--Total tetile and apparel production: 1,413 
million USD--Textile and apparel share of Finland's 
importsexports: 3.2%/0.% 
--Exports of textiles and appaels to the US: 39.6 
million USD 
--Total manufaturing employment: 465 000 
--Total textile and aparel employment: 8 576 
 
¶2. Filand's traditional textile industry, 
manufacturing cotton, woolen and other fabrics, has 
almost disappeared. Manufacture of Finnish clothing 
is increasingly taking place in Asian countries, 
especially in China.  Only one tenth of clothes sold 
in Finland are produced in the country. 
 
¶3. According to the Board of Customs, China accounts 
for approximately 29 percent of clothing imports to 
Finland. The real figure is estimated at about 35 
percent, as many garments imported from other 
countries, such as Sweden and Denmark, are in fact 
manufactured in China. In 2006, total textile and 
apparel imports to Finland amounted to 2.207 billion 
USD (from China, Germany, Sweden and Estonia) and 
the Finnish textile and fashion industry exported 
goods worth 697.5 million USD (to Russia, Sweden, 
Estonia and Germany). Imports in the textile 
industry greatly exceed exports. 
 
¶4. Finland's textile industry, mainly small or 
medium sized enterprises geographically scattered 
around Finland, has gone through a massive 
modernization process in the past few years. The 
industry has been forced to concentrate on its core 
competencies (design, marketing and sales 
operations) and outsource the less-strategic 
operations in order to survive. Due to heightened 
international competition and increasing production 
costs in Finland, Finnish textile companies have 
moved production to lower cost countries (mainly 
China and Estonia). Both the number of employees and 
the number of textile and apparel establishments in 
Finland decreases every year. Today the Finnish 
textile and clothing industry employs less than 10 
000 workers, compared with 70 000 in the 1970s boom 
years. The number of employees decreased by almost 
nine percent, and the number of textile and clothing 
establishments dropped by almost two percent from 
2005 to 2006. 
 
¶5. Finnish textile and apparel companies are 
searching for cost benefits through subcontracting 
from Asia. In Finland subcontracting is used in the 
textile industry more often than in the world on 
average, consequently the Finnish textile industry 
turnover has continued to increase, although the 
actual textile and apparel production is decreasing 
in Finland. 
 
¶6. Finland's northern location, the dramatic changes 
in climate from season to season, and the small size 
of the local market have caused the textile and 
apparel industry to specialize. Finnish clothing 
manufacturers have significant market shares in 
various types of outdoor clothing with very precise 
requirements. These include clothes for skiing, 
hiking, hunting and tobogganing. The industry 
specializes in professional and work clothing that 
adds to safety and productivity, as well as daily 
fashion. The Finnish textile and clothing industry's 
products combine technical properties with elements 
of Nordic design and high commercial quality. With 
these changes - specialization, shift to 
subcontracting and investment in low-wage countries 
- the Finnish textile and apparel industry should be 
able to survive. 
 
HYATT