Helsinki, Jun 1 (IANS): The volume of Finland's gross domestic product (GDP) contracted by 0.4 per cent in the first quarter of 2023 on a year-on-year (YoY) basis, the country's statistical department said.

Statistics Finland said that the country's economy however, grew by 0.2 per cent from the previous quarter, reports Xinhua news agency.

The department explained that the contraction of investments slowed down the growth of the national economy.

In the first quarter, gross fixed capital formation, or investments, contracted by 3.0 per cent from the previous quarter.

As a result, both private and public investments decreased.

Meanwhile, the volume of exports decreased by 0.1 per cent from the previous quarter, and the volume of imports declined by 2.7 per cent from the previous quarter.

According to the Finland Chamber of Commerce, the development of the country's GDP at the beginning of this year was significantly weaker than expected.

"The estimate of economic development was significantly revised downwards, which fits better with the general interpretation of the situation of the Finnish economy," Jukka Appelqvist, chief economist of the Finland Chamber of Commerce, said.

Appelqvist said that the economy's fundamentals would not favour rapid growth for the time being due to strong headwinds in the economy.

Moreover, difficulties are ahead, as consumers' savings are starting to decline, the eurozone's industry is in trouble, and the outlook for construction investments remains gloomy.