HELSINKI, May 17 (Reuters) – Troubles at Finland’s Nokia Oyj aren’t just bad news for the company, its staff and shareholders. They’re also a warning sign for the small Nordic country’s welfare model.

Just as Nokia’s sure touch with well-designed, consumer-friendly products seems to have deserted it, fears are growing that Finland, whose reputation for innovation rested largely on the handset maker’s success, m ay be losing its competitive edge.

While Finland remains one of the few triple-A rated countries in the euro zone, its reputation as an egalitarian society with a stellar education system belies worries about a decline in once-mighty export manufacturers and a rapidly ageing population.

For the 5.4 million Finns, the message is stark: prepare for tougher times, later retirement or lower pensions. And for government, the need is to encourage business growth beyond traditional mainstays like forestry while balancing social commitments with economic realities.

On Tuesday Finland reported a second straight monthly current account deficit. For 2011 as a whole, it posted a deficit of 1.3 billion euros ($1.7 billion) due to slower export growth.

“It’s useless to dream of achieving the same levels that we had between the booming years of 2001 and 2007,” said Handelsbanken economist Tuulia Asplund, referring to the years of strong industrial growth.

Economists expect the economy to contract or barely expand this year. Many forecast growth of just 1 or 2 percent in the next few years – not bad compared with some more troubled European economies, but not enough to alleviate strains on the pension system in one of the region’s fastest-ageing societies.

SAARISELKA, Finland (Reuters) – Finland is prepared to compromise on creating a bigger rescue fund for the euro zone despite scepticism over whether it is needed, Prime Minister Jyrki Katainen said on Saturday.

Euro zone finance ministers will discuss the issue at a meeting in Copenhagen on March 30-31.

While almost all of the currency bloc’s 17 member states favour a stronger firewall, Germany and Finland have been reluctant to commit.

“We are ready to find a compromise,” Katainen told Reuters in an interview on the sidelines of a gathering of senior European policy makers in Saariselka, a resort in Finnish Lapland. “What’s important is that the firewall is credible.”

The firewall is one of the longest-running challenges the euro zone has faced in trying to get on top of the sovereign debt crisis over the past two years.

The hope is that by increasing its size, it will make it easier to handle the fallout if the crisis spreads to bigger economies such as Spain.

The euro zone currently has a temporary crisis fund, the 440 billion euro EFSF, and from July will also have a permanent mechanism, the 500 billion euro ESM.

HELSINKI, Feb 5 (Reuters) – Pro-Europe politician Sauli Niinisto won Finland’s presidency on Sunday in an election that showed voters want to keep the country in the euro zone despite misgivings over European Union bailouts.

The former finance minister won with 63 percent support, defeating pro-euro Greens Party candidate Pekka Haavisto.

The two had beaten anti-euro candidates, Paavo Vayrynen of the Centre party and Timo Soini of the Finns Party, in an earlier round last month.

The weak showing by the eurosceptics was a relief for Prime Minister Jyrki Katainen, who like Niinisto is a member of the National Coalition party which supports conservative economic policy.

Analysts said worries about Europe’s debt crisis could drag Finland’s export-dependent economy into recession may have persuaded voters to choose a steady and pragmatic pair of hands.

“In tough times people want to believe that somebody is in control of the economy,” said University of Helsinki professor Tuomo Martikainen.

Niinisto said Finland was and would remain supportive of European monetary union but that he understood Finnish voters’ frustration over the debt crisis.

HELSINKI, Jan 22 (Reuters) – Pro-euro candidate Sauli Niinisto won the first round of Finland’s presidential election on Sunday, signalling voters want to keep cooperating with the European Union despite their frustration over bailouts for debt-ridden member states.

The former finance minister got 37 percent of the vote. He faces a Feb. 5 run-off with another pro-euro candidate, Pekka Haavisto of the Greens Party, who got about 19 percent.

Anti-euro candidates Paavo Vayrynen and Timo Soini dropped out of the race after the final tally.

While the president has little executive power beyond military and diplomatic affairs, it is a high-profile post and the strength of the pro-euro vote will ease pressure on the government to take a hard line against Brussels.

A eurosceptic leader may have forced Prime Minister Jyrki Katainen to demand stricter conditions on European bailout plans in the months ahead.

“This has significance. This has an impact on political discussions, as Europe is going through difficult talks on crisis management,” said University of Helsinki professor Tuomo Martikainen. He and other analysts said Niinisto will likely win the second-round.

EUROSCEPTICISM RETREATS

HELSINKI, Jan 6 (Reuters) – Finnish voters look set to elect veteran conservative Sauli Niinisto as their next president as anti-euro sentiment takes a backseat to economic concerns.

The former finance minister from the National Coalition party, with around 40 percent support in polls, is clear favourite for the Jan. 22 election.

After the highly eurosceptic Finns Party emerged from obscurity to become the main opposition in April’s general election – on a campaign opposing EU bailouts – some expected its leader Timo Soini to be a formidable presidential candidate.

But Soini is trailing with under 10 percent, according to latest media surveys, putting him behind at least one other presidential hopeful, Centre Party veteran Paavo Vayrynen.

If none of the eight candidates gets more than half the votes a run-off between the top two follows two weeks later.

Voters may be reassured by Niinisto’s experience, analysts say, even though Finland’s president has little executive power beyond military and diplomatic affairs.

“Finns are worried about the current state of Europe, the state of the euro, and you can feel that there is still a bit of anger about bailouts. But people are also worried about their future,” said Juha Jokela, programme director for the Finnish Institute for International Affairs, an independent think-tank.

TAMPERE, Finland (Reuters) – German Finance Minister Wolfgang Schaeuble said on Monday that Italy would not need a bailout if it sticks to its budget plans, but he also warned that the euro zone’s third-largest economy was too big for the region’s emergency fund to support.

Italian government bond yields hit 14-year highs on Monday, rising nearer levels widely seen as unsustainable as political turmoil threatened to drag it deeper into the regional debt crisis that has already engulfed Greece, Ireland and Portugal.

But Schaeuble said Italy’s request to be monitored by European officials and the International Monetary Fund meant it should not need to ask for external help.

“Italy has to stick to what has been announced. If Italy will deliver, will reduce its debt, there is no problem,” he told reporters after giving a speech in Tampere, Finland.

He also said Italy was too big to be rescued by the European Financial Stability Facility.

Finnish Prime Minister Jyrki Katainen told Reuters at the same event that Italy’s debt premium should decline with the IMF and EU monitoring its reforms, noting that the premium for Spain had eased in the last few months after the country took steps to improve its finances.

“We are expecting the same for Italy,” he said.

HELSINKI, Sept 2 (Reuters) – While Germany is phasing out nuclear power, Finland is looking to build more, staying its course in pursuit of cheap electricity despite the Fukushima disaster in Japan.

A Finnish consortium will soon announce the location of a new reactor, underscoring the country’s determination to curb its reliance on Russian energy and help its metals and forestry sectors stay competitive.

Fennovoima, led by German utility E.ON’s (EONGn.DE: Quote, Profile, Research, Stock Buzz) Finnish subsidiary, plans to announce the new site as soon as a court rules on land use claims. The two candidate sites, Pyhajoki and Simo, are both in northern Finland.

Finland’s parliament last year decided to allow Fennovoima and Teollisuuden Voima (TVO) to construct new nuclear reactors, which are expected to come on line by around 2020, and raise the number of reactors in Finland to seven.

Economy Affairs Minister Jyri Hakamies, who is also responsible for energy issues, said Finland launched a safety review and stress test results are due at the end of the year, but there had not been much question over whether to proceed.

“There hasn’t been a strong debate after Japan that we should change our decision,” Hakamies told Reuters. “I think Finns are very rational, pragmatic.”

RUSSIA IMPORTS

HELSINKI (Reuters) – Finland’s Prime Minister Jyrki Katainen denied on Monday that Germany and France had or could have made any new commitments for the euro zone rescue fund to buy bonds of weaker member states.

“No two (euro) countries can decide on behalf of others, and they haven’t decide between themselves on buying some country’s bonds either,” Katainen told Reuters in an interview.

Weekend comments by German Chancellor Angela Merkel and French President Nicolas Sarkozy triggered speculation that they were preparing for the European Financial Stability Facility (EFSF) to buy bonds from countries like Italy and Spain.

Finland’s position on the European debt crisis matters not only because it is a creditor nation with a triple-A rating but also because its parliament, unlike most others in the European Union, can vote on funding matters.

Since assuming the premiership in June, the former finance minister’s role has been to persuade other parliamentarians to keep Finland on a pro-Europe course in the face of opposition from parties such as the nationalist True Finns.

Katainen said he was confident the Finnish parliament will pass a euro zone rescue plan adopted in July, although he could not say when the vote would take place.

“I would say it will get through well. These policies have had support from government and the Grand Committee as well,” he said, referring to parliament’s powerful decision-making group.

LONDON/HELSINKI July 1 (Reuters) – Flybe , Europe’s largest regional airline, and Finnair have together agreed to buy Finland’s biggest domestic carrier Finnish Commuter Airlines (FCA) for 25 million euros ($35.5 million) to expand in the Baltic market.

Flybe, which has also agreed to buy 46 percent of Finnish Aircraft Maintenance, will pay 12 million euros for a 60 percent stake in the joint venture — to be known as Flybe Nordic – while Finland’s flag carrier will pay 13 million euros for 40 percent.

The British carrier, which raised around 60 million pounds through a float in London late last year, said its total investment would be 23.6 million euros including net cash and loan repayments.

“We’re going after the whole Baltic regional market and want to replicate in the Baltic regional market what we did in the UK – linking secondary and primary cities,” Flybe Chief Executive Jim French told Reuters.

“Part of the reason for the IPO was to raise funds to invest into Europe and in five years I see the European side of the business being bigger than the UK business.”

Flybe, which operates 69 aircraft from 14 UK airport bases, on Thursday posted a full-year loss of 4.3 million pounds on Thursday, hit by the impact of last year’s Icelandic volcanic eruption, severe winter weather and rising fuel costs.

“We think boosting the Finnair Helsinki hub is a good strategic move … the challenge for Flybe will be keeping out of the way of he Nordic low cost challenger Norwegian,” said Royal Bank of Scotland analyst Andrew Lobbenberg.

FRANKFURT/HELSINKI (Reuters) – Siemens said it was still in talks to sell its stake in Nokia Siemens Networks, despite a report that efforts with partner Nokia to find a third shareholder in their joint venture had failed.

“Negotiations are continuing,” a Siemens spokesman said On Monday, referring to attempts by Siemens and Nokia to sell a stake in NSN.

However, he declined to comment specifically on a Wall Street Journal report on Monday that both parents were now focusing on restructuring NSN and might inject more cash into their unprofitable joint venture.

“Multiple options continue to exist for NSN and these are reflective of the company’s performance in terms of both innovation and financial results,” Nokia told Reuters in an e-mail on Monday.

“We’re pleased with the turnaround that NSN is executing, and we remain focused on our plans to bolster NSN’s competitiveness even further,” the company added.

NSN, the world’s No. 2 maker of wireless-networking gear, declined comment.

Nokia shares were up 1.4 percent at 4.20 euros at 0945 GMT, and Siemens share were up 0.41 percent at 92.74.