It's a region renowned for its stable economy and its business-friendliness, but why should you consider the Nordics for your next venture? Our local expert looks at just some of the reasons the Nordics are calling.
The Nordics countries – Scandinavia (Denmark, Sweden and Norway) and Finland - form a region with a shared culture and history. Despite their national differences, the countries have a lot in common and are so are often perceived by international investors as one single market.
Investors are drawn to the region for its very reliable, stable and business-friendly investment climate, a gross domestic product per capita that is beyond the European average and a highly educated workforce.
The business climate
Since 1996 the World Bank has rated 215 countries on six governance variables. Measured by these “World Bank Governance Indicators”, the business infrastructure of the four Nordic countries is beyond comparison, consistently outperforming any single region in the world in terms of regulatory quality, rule of law, control of corruption, government effectiveness, voice and accountability, and political stability and absence of violence/terrorism.
In addition to the unparalleled results of the World Bank Governance Indicators, the Nordics have the highest scores in the Corruption Perceptions Index prepared annually by Transparency International; the 2014 report listed all four countries among the five least corrupt nations in the world.
According to yet another World Bank publication, the Doing Business Ranking, the four Nordic countries rank in the top 11 of most business friendly countries in the world. Recently, Forbes even labelled Denmark the Best Country for Business in the world.
The exceptionally stable and business-friendly investment environment clearly makes the Nordic region an attractive market for international investors.
In terms of financial performance, the region is outperforming many other countries in the European Union. The GDP per capita for the region is amongst the highest in the world and the GDP growth rates over the last 15 years have been considerably higher than the average growth rates in the European Union.
The Nordic countries are all considered welfare states with very high marginal tax rates and a high level of government spending. Whether it is due to the spending levels of the local governments or the relatively high income of the 24 million people living in the area, the Nordic region has been an obvious choice for many international investors looking for new markets to sell their products.
High level of education
International investors that choose to establish in the Nordic region have access to a large pool of highly-educated employees. According to the World Economic Forum Global Competitiveness Report 2014-2015, Finland has for example the best availability of scientists and engineers in the world. English proficiency levels are amongst the highest in the world and the Nordic countries are on the forefront of the latest technologic developments.
Quality of life
The standard of living in the Nordic countries is very high, and the welfare states offer free education and health care. The Monocle’s 2014 Quality of Life Survey named Copenhagen the most liveable city in the world for the third time. According to the same survey two other Nordic capitals - Helsinki and Stockholm - are in the top five most liveable cities in the world. Newsweek ranked Finland as the world’s best country on the basis of environment, education and quality of life.
The business environment in the Nordic countries is one of the most friendly in the world. This, in combination with the fact that the business infrastructure in the Nordic countries is remarkably reliable with extremely low levels of corruption, and the fact that the GDP levels for the 24 million inhabitants in the Nordic region are among the highest in the world, makes the Nordic region a very popular region for international investors.
The fact that Apple on 23 February 2015 announced Denmark would be the operation of a very large datacentre, their biggest European investment to date, does in the light of the this article seem to be a very sensible decision.
Read more about doing business in Denmark, Finland, Norway or Sweden.