History

Main article: History of Finland Prehistory Main article: History of Finland#Prehistory

According to archaeological evidence, the area now comprising Finland was settled at the latest around 8500 BCE during the Stone Age as the ice sheet of the last ice age receded. The artifacts the first settlers left behind present characteristics that are shared with those found in Estonia, Russia and Norway. The earliest people were hunter-gatherers, using stone tools. The first pottery appeared in 5200 BCE when the Comb Ceramic culture was introduced. The arrival of the Corded Ware culture in southern coastal Finland between 3000 and 2500 BCE may have coincided with the start of agriculture. Even with the introduction of agriculture, hunting and fishing continued to be important parts of the subsistence economy.

The Bronze Age (1500–500 BCE) and Iron Age (500 BCE–1200 CE) were characterised by extensive contacts with other cultures in the Fennoscandian and Baltic regions. There is no consensus on when Uralic languages and Indo-European languages were first spoken in the area of contemporary Finland. During the 1st millennium AD, early Finnish was spoken at least in agricultural settlements of Southern Finland, whereas Sámi-speaking populations occupied most parts of the country.

Swedish era The Swedish Empire following the Treaty of Roskilde of 1658. Dark green: Sweden proper, as represented in the Riksdag of the Estates. Other greens: Swedish dominions and possessions.

Swedish kings established their rule in the Northern Crusades from the 12th century until 1249. The area of present-day Finland became a fully consolidated part of the Swedish kingdom. Swedish-speaking settlers arrived at the coastal regions during the medieval time. In the 17th century, Swedish became the dominant language of the nobility, administration and education; Finnish was chiefly a language for the peasantry, clergy and local courts in predominantly Finnish-speaking areas.

During the Protestant Reformation, the Finns gradually converted to Lutheranism. In the 16th century, Mikael Agricola published the first written works in Finnish. The first university in Finland, The Royal Academy of Turku, was established in 1640. Finland suffered a severe famine in 1696–97, during which about one-third of the Finnish population died, and a devastating plague a few years later. In the 18th century, wars between Sweden and Russia led to the occupation of Finland twice by Russian forces, wars known to the Finns as the Greater Wrath (1714–21) and the Lesser Wrath (1742–43). By this time Finland was the predominant term for the whole area from the Gulf of Bothnia to the Russian border.

Russian Empire era Main article: Grand Duchy of Finland See also: Finland's language strife and Russification of Finland

On 29 March 1809, having been taken over by the armies of Alexander I of Russia in the Finnish War, Finland became an autonomous Grand Duchy in the Russian Empire until the end of 1917. In 1811 Alexander I incorporated Russian Vyborg province into the Grand Duchy of Finland. During the Russian era, the Finnish language began to gain recognition. From the 1860s onwards, a strong Finnish nationalist movement known as the Fennoman movement grew. Milestones included the publication of what would become Finland's national epic – the Kalevala – in 1835, and the Finnish language's achieving equal legal status with Swedish in 1892.

The Finnish famine of 1866–1868 killed 15% of the population, making it one of the worst famines in European history. The famine led the Russian Empire to ease financial regulations, and investment rose in following decades. Economic and political development was rapid. The GDP per capita was still half of that of the United States and a third of that of Britain.

In 1906, universal suffrage was adopted in the Grand Duchy of Finland. However, the relationship between the Grand Duchy and the Russian Empire soured when the Russian government made moves to restrict Finnish autonomy. For example, the universal suffrage was, in practice, virtually meaningless, since the tsar did not have to approve any of the laws adopted by the Finnish parliament. Desire for independence gained ground, first among radical liberals and socialists.

Civil war and early independence Soviet approval of Finland's independence (in Russian). Main articles: Finnish Declaration of Independence and Finnish Civil War

After the 1917 February Revolution, the position of Finland as part of the Russian Empire was questioned, mainly by Social Democrats. Since the head of state was the Czar of Russia, it was not clear who the chief executive of Finland was after the revolution. The parliament, controlled by social democrats, passed the so-called Power Act to give the highest authority to parliament. This was rejected by the Russian Provisional Government and by the right-wing parties in Finland. The Provisional Government dissolved the parliament by force, which the social democrats considered illegal, since the right to do so had been stripped from the Russians by the Power Act.

New elections were conducted, in which right-wing parties won a slim majority. Some social democrats refused to accept the result and still claimed that the dissolution of the parliament (and thus the ensuing elections) were extralegal. The two nearly equally powerful political blocs, the right-wing parties and the social democratic party, were highly antagonized.

The October Revolution in Russia changed the game anew. Suddenly, the right-wing parties in Finland started to reconsider their decision to block the transfer of highest executive power from the Russian government to Finland, as radical communists took power in Russia. Rather than acknowledge the authority of the Power Law of a few months earlier, the right-wing government declared independence on 6 December 1917.

On 27 January 1918, the official opening shots of the war were fired in two simultaneous events. The government started to disarm the Russian forces in Pohjanmaa, and the Social Democratic Party staged a coup. The latter succeeded in controlling southern Finland and Helsinki, but the white government continued in exile from Vaasa. This sparked the brief but bitter civil war. The Whites, who were supported by Imperial Germany, prevailed over the Reds. After the war, tens of thousands of Reds and suspected sympathizers were interned in camps, where thousands died by execution or from malnutrition and disease. Deep social and political enmity was sown between the Reds and Whites and would last until the Winter War and beyond. The civil war and activist expeditions into the Soviet Russia strained Eastern relations.

After a brief flirtation with monarchy, Finland became a presidential republic, with Kaarlo Juho Ståhlberg elected as its first president in 1919. The Finnish–Russian border was determined by the Treaty of Tartu in 1920, largely following the historic border but granting Pechenga (Finnish: Petsamo) and its Barents Sea harbour to Finland. Finnish democracy did not see any Soviet coup attempts and survived the anti-Communist Lapua Movement. The relationship between Finland and the Soviet Union was tense. Germany's relations with democratic Finland cooled also after the Nazis' rise to power. Army officers were trained in France, and relations to Western Europe and Sweden were strengthened.

In 1917, the population was 3 million. Credit-based land reform was enacted after the civil war, increasing the proportion of capital-owning population. About 70% of workers were occupied in agriculture and 10% in industry. The largest export markets were the United Kingdom and Germany.

World War II Areas ceded by Finland to the Soviet Union after the Winter War in 1940 and the Continuation War in 1944. The Porkkala land lease was returned to Finland in 1956. Finland covered an area of approximately 385,000 km2 (149,000 sq mi) before the handover. Main article: Military history of Finland during World War II

During World War II, Finland fought the Soviet Union twice: in the Winter War of 1939–1940 after the Soviet Union had attacked Finland; and in the Continuation War of 1941–1944, following Operation Barbarossa, in which Germany had invaded the Soviet Union. For 872 days, the German army besieged Leningrad, the USSR's second largest city. The siege of Leningrad resulted in the deaths of some one million of the city's inhabitants. Finnish troops controlled some of the areas around the city but refused to attack or let Germans use those areas for attack; whether they should be said to have helped in the siege or refused to help is controversial. After fighting a major Soviet offensive in June/July 1944 to a standstill, Finland reached an armistice with the Soviet Union. This was followed by the Lapland War of 1944–45, when Finland fought against the retreating German forces in northern Finland.

The treaties signed in 1947 and 1948 with the Soviet Union included Finnish obligations, restraints and reparations—as well as further Finnish territorial concessions begun in the Moscow Peace Treaty of 1940. As a result of the two wars, Finland was forced to cede most of Finnish Karelia, Salla and Petsamo, which amounted to 10% of its land area and 20% of its industrial capacity, including the ports of Vyborg (Viipuri) and ice-free Liinakhamari (Liinahamari). Almost the whole population, some 400,000 persons, fled these areas. Finland was never occupied by Soviet forces and retained its independence, however at a loss of about 93,000 soldiers killed.

Finland rejected Marshall aid, in apparent deference to Soviet desires. However, the United States provided secret development aid and helped the still non-communist Social Democratic Party in hopes of preserving Finland's independence. Establishing trade with the Western powers, such as the United Kingdom, and the reparations to the Soviet Union caused Finland to transform itself from a primarily agrarian economy to an industrialised one. For example, the Valmet corporation was founded to create materials for war reparations. Even after the reparations had been paid off, Finland—poor in certain resources necessary for an industrialized nation (such as iron and oil)—continued to trade with the Soviet Union in the framework of bilateral trade.

Cold War

In 1950, half of the Finnish workers were occupied in agriculture and a third lived in urban areas. The new jobs in manufacturing, services and trade quickly attracted people to the towns. The average number of births per woman declined from a baby boom peak of 3.5 in 1947 to 1.5 in 1973. When baby-boomers entered the workforce, the economy did not generate jobs fast enough, and hundreds of thousands emigrated to the more industrialized Sweden, with emigration peaking in 1969 and 1970. The 1952 Summer Olympics brought international visitors. Finland took part in trade liberalization in the World Bank, the International Monetary Fund and the General Agreement on Tariffs and Trade.

Urho Kekkonen, the eighth president of Finland. Kalevi Sorsa was a long-time prime minister of Finland during the 1970s and 1980s.

Officially claiming to be neutral, Finland lay in the grey zone between the Western countries and the Soviet Union. The YYA Treaty (Finno-Soviet Pact of Friendship, Cooperation and Mutual Assistance) gave the Soviet Union some leverage in Finnish domestic politics. This was extensively exploited by president Urho Kekkonen against his opponents. He maintained an effective monopoly on Soviet relations from 1956 on, which was crucial for his continued popularity. In politics, there was a tendency of avoiding any policies and statements that could be interpreted as anti-Soviet. This phenomenon was given the name "Finlandization" by the German press.

Despite close relations with the Soviet Union, Finland remained a Western European market economy. Various industries benefited from trade privileges with the Soviets, which explains the widespread support that pro-Soviet policies enjoyed among business interests in Finland. Economic growth was rapid in the postwar era, and by 1975 Finland's GDP per capita was the 15th highest in the world. In the 1970s and 1980s, Finland built one of the most extensive welfare states in the world. Finland also negotiated with the EEC (a predecessor of the European Union) a treaty that mostly abolished customs duties towards the EEC starting from 1977, although Finland did not fully join. In 1981, president Urho Kekkonen's failing health forced him to retire after holding office for 25 years.

Miscalculated macroeconomic decisions, a banking crisis, the collapse of its largest single trading partner (the Soviet Union) and a global economic downturn caused a deep recession in Finland in the early 1990s. The depression bottomed out in 1993, and Finland saw steady economic growth for more than ten years.

Recent history Finland introduced the currency of the Eurozone, the euro, in 2002.

Like other Nordic countries, Finland has liberalized its economy since the late 1980s. Financial and product market regulation was loosened. Some state enterprises have been privatized and there have been some modest tax cuts. Finland joined the European Union in 1995, and the Eurozone in 1999.

The population is aging with the birth rate at 10.42 births per 1,000 population, or a fertility rate of 1.8. With a median age of 42.7 years, Finland is one of the oldest countries; half of voters are estimated to be over 50 years old. Like most European countries, without further reforms or much higher immigration, Finland is expected to struggle with demographics, even though macroeconomic projections are healthier than in most other developed countries.

The Finnish markka was replaced by the euro in 2002. As a preparation for this date, the minting of the new euro coins started as early as 1999; this is why the first euro coins from Finland have the year 1999 on them, instead of 2002 like some of the other countries of the Eurozone. Three different designs (one for €2 coin, one for €1 coin and one for the other six coins) were selected for the Finnish coins. In 2007, in order to adopt the new common map like the rest of the Eurozone countries, Finland changed the common side of its coins.