HELSINKI - Finland expects economic contraction this year and little improvement in 2013 as the export-dependent country continues to suffer from reduced demand among European trading partners.

The Finance Ministry says GDP is expected to decline 0.1 per cent this year and rise only 0.5 per cent in 2013, mainly because of growth in domestic demand. Growth will improve slightly to 1.7 per cent in 2014, when trading partners in the 17-country eurozone are expected to keep struggling economically.

The ministry earlier predicted 1 per cent growth this year and 1.8 per cent in 2013.

In the report published Thursday, the ministry estimates export volumes this year fell 1.7 per cent and would grow about 1 per cent next year.

Finland fell into recession this year after economic output dropped by 1.1 per cent in the second quarter.

© Copyright 2013