Finnish News Recap, Week 23: Fuel Prices edition

FUEL PRICES: Four parties, the center-right National Coalition, the right-wing populist Finns Party, the Swedish People’s Party and Christian Democrats, are still negotiating for a government. The process is not easy. It remains to be seen whether the work will be finished this week, as promised by PM candidate Petteri Orpo, from National Coalition.

One topic that loomed large in last week’s efforts was fuel prices. It is, of course, not a surprise that fuel prices have risen last year in Finland, as they have done everywhere else. Indeed, they are the highest in Europe, or at least were last month. A main reason is, unsurprisingly, the import chaos caused by Russia’s invasion of Ukraine and the resulting sanctions.

However, the right-wing populist Finns Party has fingered a different cause – the “distribution obligation”, “jakeluvelvoite” in Finnish, which requires biofuels to be included in the fuel mix at a certain ration. This comes from an EU directive, which Finland is in the process of implementing. The EU’s goal is 14 % of transport fuels being biofuels, though Finland is aiming higher. The outgoing government agreed to lift it 28 % in 2024 and going towards 34% after that, though it was temporarily cut last year due to the exceeding difficulties.

It is unclear what the actual effect of the distribution obligation on fuel prices is, but probabilities are that there’s *some* effect, as such regulations tend to have. The Finns Party’s main issue is immigration, true. However, what got them the votes in this election was their firm advocacy against what they (and rural voters) consider to be excessive environmental legislation. They’ve promised their voters they’ll get the fuel prices down, and if they can’t manage to do that, they’ll crash in the next election.

While the Finns Party would chiefly want to just get Finland out of the EU if it could, it has been advocating for lowering the rate to 6 %, the lowest allowed by EU regulations – the same rate as in Sweden. The current compromise proposal, at least insofar as the few leaks from the negotiations would indicate, would be that the bio-obligation continues to go higher, though not to 28 %, but to compensate for it the fuel tax would be cut.

That, in turn, creates a budget shortfall, so some other tax could be raised to compensate for that. VAT on food, for example. If such a compromise takes place, we’ll see how the voters of the government parties will like it. Undoubtedly some will, as long as the fuel prices go down. At least thus far, the potential coalition partners are polling well.

Also, the Swedish People’s Party held a party convention last weekend. Beyond some expressions of unease with the negotiations process, nothing particularly dramatic happened. The party also voted on whether fur farming should be banned. Predictably, fur farming being a major profession in the Swedish-speaking countryside, they decided it should not be.

NEW GREEN LEADER: The Green Party also held a party convention, electing a new leader, Sofia Virta, after their outgoing leader Maria Ohisalo resigned after their election loss. The Greens organized a membership ballot for this. They are one of the few parties doing this instead of just a vote by delegates.

Many had predicted that the party leadership would be taken by Saara Hyrkkö, an engineer from Espoo who basically would have continued Ohisalo’s policies. Virta, who had run a campaign promising change inside the party and greater media visibility, was thus a surprise winner. Virta has spoken of being from a poor background, having faced spousal abuse and being a single mother now. Perhaps the Greens simply considered her more interesting as a person than the rather gray Hyrkkö.

More notable is that the new leader has promised to shift the Greens rightwards. She herself has (on the Finnish political scale) modestly center-right views on economic matters. She would like to generally utilize more private providers for service production, cut middle-class benefits like earnings-related unemployment subsidy, and is committed to the 6-billion-dollar budget adjustment also promised by the incoming government.

Virta naturally maintains the Green commitment to environmentalism and social liberalism. She has opined that the party needs a renewed effort to convince people, particularly the rural people, that the Greens do not in fact hate them, or wish to ban cars and meat. It remains to be seen how much the party’s image will chang. For one thing, the party’s strong Helsinki/party office worker wing will probably not look at her kindly for beating their preferred candidate.

The Green shift to the right might attract liberal center-right voters. Certainly many from the more liberal parties negotiating a government greatly dislike the right-wing populist Finns Party. On the other hand, left-wing parties, Left Alliance and Social Democrats, are already looking for ways to attract the most left-wing Green supporters to become *their* voters.

Also, Pekka Haavisto, the outgoing government’s Foreign Minister, expectedly announced a run for Presidency in 2024. Haavisto, who has been candidate twice before, losing to current president Sauli Niinistö in both cases, is the current odds-on favorite for presidency, though this mainly reflects the fact that the Greens have spent a considerable number of resources and political capital to make this happen.

IN OTHER NEWS, after a cold start of June it’s getting hot with +30 C weather promised this week (perhaps in anticipation a rare whale has been spotted in the Baltic) and the Pride Week is preceded by cases of anti-gay violence.

Image source: https://fi.m.wikipedia.org/wiki/Tiedosto:Suutarilan_huoltoasemat_1.JPG