The Finns lost their AAA credit rating from Standard & Poor’s last week, because of the “loss of global market share in the key information technology sector [and] structural retrenchment of the important forestry sector.”

Finland Loses AAA Rating, PM Blames Apple

PM Stubb has claimed that he holds Apple Inc. (NASDAQ:AAPL) responsible for the decline:

“We have two champions which went down,” Stubb told CNBC. “I guess one could say that the iPhone killed Nokia and the iPad killed the Finnish paper industry, but we’ll make a comeback.”

Apple caused the demise of Nokia

In 2007 Nokia Corporation (ADR) (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) was worth $150 billion, and was responsible for a quarter of Finland’s economic growth from 1998 to 2007. For about a decade either side of the new millennium, the company was at the cutting edge of mobile phone manufacturing, and paid around 20% of Finland’s total corporation tax. The company has long been seen by commentators as a bellwether for the economy as a whole.

All that changed with the introduction of the touch screen smartphone, and more specifically the iPhone. Microsoft Corporation (NASDAQ:MSFT) bought Nokia’s mobile phone business for $7 billion last year after shares in the company lost 75% of their value. The remaining part of the business now works on telecoms network equipment, which is by no means a thriving industrial sector.

A suffering paper sector

In its end-of-year report in 2013, the Finnish Forest Research Institute (Metla) predicted the continued contraction of the production and export of paper in 2014. The country is a massive production site for UPM-Kymmene and Stora Enso, Europe’s largest paper producers. 

Investors in Stora Enso have seen the shares lose almost half of their value over the past five years. Although the iPad is not entirely to blame for the decline of print media around the world, Stubb is correct in noticing the rise in consumption of digital media.

It’s not all doom and gloom from Stubb though, he later claimed that “forest is coming back in terms of bio energy and other things.Usually what happens is that when you have dire times you get a lot of innovation and I think from the public sector our job is to create the platform for it.”