] both the security policy environment and the economic environment of europe and of finland are going through a very tough transition. the rise in energy prices has slashed living standards, inflation has become more broad - based and next year's economic outlook is marked by uncertainty. by tightening monetary policy, the risk of a detrimental wage - price spiral will be reduced and inflation will be stabilised at its target of 2 % over the medium term. looking beyond the crises, the challenges for long - term growth in finland will remain as before. the shifting age structure and climate change are no longer challenges for the future alone, as their impact is already visible and felt. finland emerged from the early 1990s recession by embracing innovation and research, expertise and enterpreneurship. we invested in innovation funding even during the recession, and we reformed corporate taxation, put competitiveness on a better footing and focused on renewable energy. a balance was brought to the public finances. in the face of enormous challenges today, as well, we need to act with determination and unity in europe and finland to ensure we can meet the major challenges ahead. now is the time when we need a capacity for reform, so that we can firmly pursue sustainable growth and employment both in europe at large and of course here in finland. i do hope this capacity for reform can be found. thank you for your attention. 8 / 8 bis - central bankers'speeches

and businesses improved in past decade ] the competitiveness of finnish labour and businesses deteriorated following the global financial crisis, and we then experienced a decade of slow growth. competitiveness has nevertheless improved since 2016 – and the employment rate has subsequently risen from 67 % to 74 %. there is currently considerable uncertainty over the future development of labour costs. forthcoming wage agreements here and elsewhere will determine the way forward for competitiveness. unfortunately, the situation regarding labour market negotiations in finland is currently more challenging than it has been for many years. it is clear, nonetheless, that the transformation of the security environment and the turmoil in energy markets have now led many finnish exporters to seek new markets 4 / 8 bis - central bankers'speeches for their products – and the same is happening elsewhere in europe, too. europe's energy supply also needs to be reshaped. in addition, security concerns are forcing a reexamination of economic dependencies. [ slide 14. green transition in energy now moving forward though not in a planned manner ] the energy crisis is now dominating the economic outlook for europe and for finland, and causing continued uncertainty. the green transition is now moving ahead but not in a planned manner and not in the way we would have liked, being driven by the ukraine war and the energy crisis. energy prices were already beginning to rise last year as the global economy was recovering from the pandemic, and the situation was further exacerbated by the outbreak of the war. this winter will be characterised by the major imbalance between demand and supply. efforts should be made to get the most out of all demand flexibilities and energy saving opportunities, and fiscal support measures should be carefully targeted and tailored. fortunately, the situation in finland in this regard is not as difficult as in the major euro area economies. in industrial sectors the shift away from fossil energy sources has been in progress for some considerable time already. this move has been aided by the use of nuclear energy and renewable energy sources, and through participation in the nordic electricity market. besides the coming winter, the immediate years ahead will also be challenging. this year, gas reserves were replenished through a limited amount of imported russian gas, but next year even that amount will not be obtained. the long - term direction of europe's energy policy as a whole is unresolved. it is especially important at this time to maintain european unity both in national policy measures and in regard to imports of russian energy products. [ slide