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Finland's Prime Minister Juha Sipila arrives for the European Union summit- the first one since Britain voted to quit- in Bratislava, Slovakia, September 16, 2016. REUTERS/Yves Herman


HELSINKI (Reuters) - Finland's centre-right government has dropped plans to help build a Guggenheim museum in Helsinki with state funding, Prime Minister Juha Sipila said on Wednesday.

The Solomon R. Guggenheim Foundation has proposed a museum for Helsinki, like those that grace New York, Bilbao and Venice.

But one of Finland's three co-ruling parties last month opposed the state covering 40 million euros ($44 million) of its building costs.

Government aid has been considered crucial for the 120 million-140 million euro project and the foundation has been eager to continue negotiations before the reservation of the seafront plot expires at the end of 2016.

But Prime Minister Juha Sipila, asked whether the project was now dead and buried, told Reuters:

"It is. This government will not make such a proposal. It is only a financial question, at the moment we don't have a possibility to invest."

Promoters of the museum had hoped it would be a boost for the recession-hit country, while some Finns considered the project a waste of taxpayer money at a time of cuts to government welfare and schools.

(Reporting by Jussi Rosendahl)

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