Finland

Finnish unemployment rose to the highest in six months at the end of last year, increasing more than economists estimated, as Europe's debt crisis sapped economic growth in the northernmost euro member, the Irish Times reported on a Bloomberg story. The jobless rate, which isn't adjusted for seasonal variations, rose to 7.4 per cent in December from 6.2 per cent in November, Statistics Finland said Tuesday. The rate topped all four economist estimates in a survey by Bloomberg.

Once an example of Finland's success in technology innovation, electronics manufacturer Elcoteq filed for bankruptcy on Thursday after failing to reverse a fall in sales and restructure its debt, Reuters reported. The assembler of cellphones and set-top boxes struggled after Nokia Oyj switched to cheaper Asian suppliers a few years ago. It also worked for Research In Motion , LG Electronics and others, but was unable to replace the lost business.

Elcoteq, the Finnish electronics manufacturer under insolvency proceedings, said on Tuesday it filed another subsidiary for bankruptcy, Reuters reported. The group that assembles cellphones and set-top boxes said Elcoteq Network S.A., which handled its material purchases and customer invoicing in Europe, was no longer able to continue its activities after lenders blocked its bank accounts. The parent company said insolvency proceedings continued in Luxembourg. Last month Elcoteq filed three subsidiaries for bankruptcy due to a lack of funding. Its chief executive resigned earlier in August.

Finland is stepping up efforts to find a compromise with Europe on its collateral demands amid International Monetary Fund opposition to forcing Greece to give euro members extra security for new loans, Bloomberg reported. “We will seek a solution together everyone can agree on and one that doesn’t hurt anyone,” Finland’s Prime Minister Jyrki Katainen told reporters Monday in Helsinki after meeting with European Union President Herman Van Rompuy.

German Chancellor Angela Merkel is weighing whether to yield to a demand by some lawmakers for a bigger voice in future debt bailouts as a condition to win her party's approval for a stronger euro-zone rescue fund, as a parliamentary vote on the issue was delayed a week, The Wall Street Journal reported. Granting the German parliament the right to approve or reject future bailouts could trigger similar demands from parliaments across the euro zone, whose lawmakers are closely observing Berlin's actions. That could lead to further delays in the EU's approval for the Greek rescue.

France and Germany may effectively run the European Union, but Finland has been demonstrating how even a small country can disrupt their grand designs, the International Herald Tribune reported. By insisting that it receive collateral from Greece in return for aid, Finland is threatening to upend an agreement that euro zone countries, led by France and Germany, made in July to expand the E.U. bailout fund. Finland would contribute less than 2 percent of the guarantees provided to the fund, known as the European Financial Stability Facility.

Germany said on Monday that a deal Finland struck with debt-wracked Greece for Athens to provide collateral in exchange for loan guarantees required the consent of all 17 eurozone members, Agence France-Presse reported. The agreement "must be approved by the other eurozone member countries," a finance ministry spokesman told a regular government press briefing. "Such a bilateral accord may not be agreed to the detriment of the others," he said, referring to the other countries coming to the aid of Greece.

Finnish group Elcoteq , a key supplier to cellphone maker Nokia , said it was applying for insolvency proceedings after lenders blocked its bank accounts and refused a debt standstill, Reuters reported. Elcoteq said on Monday Danske Bank decided to accelerate its outstanding revolving credit facility, forcing it to apply for controlled management in Luxembourg to continue operations. The company, which assembles cellphones and set-top boxes, said in June it would not be able to repay the remaining amount of a revolving credit facility.

Finnish lawmakers failed Tuesday to reach a clear all-party majority on whether to support the country's participation in a bailout of Portugal, The Wall Street Journal reported. Lawmakers had discussed the country's participation in the bailout within their own parties, ahead of a scheduled decision in the Grand Committee of the Finnish parliament on Wednesday. The Grand Committee decides parliament's position on EU legislation and the decisions by its 25 members are politically binding.

In the general election last weekend, the nationalist and populist True Finn Party emerged from political obscurity after largely campaigning on the evils of the European Union and its bailouts of Greece and Ireland. It claimed 39 seats in Finland’s Parliament — almost eight times the number it won in the 2007 election — and it is likely to become a partner in any coalition government, the International Herald Tribune reported. The elections drove the governing Center Party from power and left this small and prosperous country reeling.