Interview: Finland’s defence industry sets course for fourfold growth

In population terms, Finland is a small country. 

Yet it fields one of Europe’s most capable defence forces, underpinned by an ambitious and increasingly innovative industrial base.

- The Finnish defence industry is strong and has always been strong. It is small in comparison to larger European member states, but we have high ambitions, says Tuija Karanko, secretary general of the Finnish Defence and Aerospace Industries, PIA, and vice chair of the NATO Industrial Advisory Group.

Twelve billion

As part of a wider survey, Defence Nordic asked industry leaders in Denmark, Finland, Norway and Sweden to assess the region’s defence industrial base, the state of cooperation, its potential and the remaining barriers.

For Finland, those ambitions extend well beyond current performance.

The industry’s objective is to quadruple combined annual turnover from three billion euro to twelve billion euro between 2025 and 2030. For comparison, Finland’s largest defence contractor, Patria, reached a strategic milestone in 2025 with annual sales of one billion euro.

Karanko maintains that the growth target is achievable.

- There are many positive signals in the market, although we also see protectionism at an all-time high in certain cases. There is clear potential for significant growth, and that is what we are working towards.

Unlike many countries, Finland operates a comprehensive total defence model in which industry plays a central role in national resilience.

- Our companies have always been prepared, and they act as strategic partners to the defence forces. Finnish companies, for example, are responsible for the maintenance of Army, Navy and Airforce materiel and equipment. In many other countries, this is handled by the armed forces themselves, Karanko explains.

Finland is also home to innovative defence and dual-use start-ups like Kelluu and Iceye.

The question is whether there is scope for deeper Nordic cooperation, or whether Finland’s model is sufficient on its own.

Karanko emphasises that Finland has long been, and will remain, an open defence market, traditionally procuring most of its equipment from abroad.

- I see Nordic cooperation as a natural and straightforward first step in collaborative projects. There are many opportunities to increase cooperation, she says.

At the same time, she notes that the combined Nordic market is larger than Italy’s, despite having less than half its population. However, a Nordic focus alone will not suffice.

- We need to aim for global competitiveness.

No significant obstacles

Earlier week, Karanko’s Danish counterpart, Joachim Finkielman, said there is political will for closer Nordic cooperation and that companies are already working across borders, but that genuine momentum has yet to materialise.

For Karanko, cooperation ultimately depends on companies’ strategic priorities and whether collaboration makes commercial sense. The opportunities are there, she argues.

- I do not see any particular incentives from politicians specifically for Nordic cooperation, but I do not see significant obstacles either. We share an operating environment and need to make better use of cooperation where it makes sense, she says.

Karanko adds that companies must be brought together in a structured way, while ensuring that the customer plays a clear role in enabling further collaboration.

The four Nordic industrial associations already work closely to establish forums and other mechanisms for networking and cooperation. This effort must continue, supported by the defence forces and at political level.

- We are doing quite a lot, but we can do more. There are many ways to work together and go to market – in the Nordics and beyond.