War of aggression in Ukraine hits business costs

War of aggression in Ukraine hits business costs

The war of aggression in Ukraine has hit a sore spot when it comes to price development, as the inflationary situation is already challenging, said Juho Romakkaniemi, CEO of the Finland Chamber of Commerce.

He pointed out that the war has raised the prices of several raw materials that were already high and had a broad-based impact on business costs, as well as consumer prices.

The cost pressure is something that companies are having to transfer to consumers. Romakkaniemi believes that it is important to foster the investment environment to ensure companies can make the substantial energy investments they need to break their dependence on Russia. This would make sure companies can cope with the change in the operating environment, as well as possible, without compromising their competitiveness.

63 per cent of companies gauged that the war will have no impact on their investments, while 29 per cent of companies said that the war has forced them to scale back their investment plans moderately or significantly.

More than a quarter 28% of companies indicated that the war has complicated co-operation with foreign investors and partners moderately or significantly.

According to Romakkaniemi, the open-ended questions of the survey highlight how polarised companies are in regards to the impact of the war and future outlook. The impact has been small for some companies, but significant for others with ties to Russia.

He added that the situation can change in the blink of an eye due to accelerating inflation and many companies continue to have high growth expectations.

There were nearly 2,000 companies from different sectors and regions in Finland who responded to the survey on 6 June.