OHUTLEVY 2026 • 55 www.ohutlevy.com In general, the Estonian economy is characterized by its size of only 1.3 million inhabitants. Even the metal industry is the main employer by size it represents only 25,000 people. Tax rates are lower than EU average, the state debt is record low, actually the lowest in the EU. Economic challenges Asccording to Kirsimäe Estonia, the European countries including Estonia suffers from extremely fast declining birth rates. To combat the future decline of trade competitivity more extensive applications of robotization and automation are expected. Because of the similarity of risks in economies of Finland and Estonia both countries would benefit from investments on efficiency and comepetitivity. The already existing integrated production chains in Finland and Estonia make the cooperation even more beneficial. Encouraging signs for growth Finland, Sweden, Lithuania and Germany are the biggest trade partners of Estonia. This calls for production diversification and export growth. According to Raul Kirsimäe there are some other significant trends of growth too. • Invisible recession – This means that domestic companies absorbed the impact of weaker economic conditions. • The share of labour income in GDP has increased. This means that total employment has grown and wages represent a heavie share of growth. FIG. 22. Raul Kirsimae, Swebank, Estonia. FIG. 23. Production index of the Estonian manufacturing industry fell down sharply and deep after Russian attack 2022. In 2025 the recovering occurred but pre-war indexes are still far away. FIG. 26. Estonia has the lowest budget deficit and also the lowest public debt. These figures help to keep future taxes low. FIG. 25. Rising wages require more robotization and automation. Average labour cost in Estonia is 20 €/h, which is about 50% below the EU average and astonishing 40% of the German industry labor cost average. FIG. 24. Annual Estonian metal industry production index variations show the big influence of Russo-Ukrainian war. Estonia is one of the biggest per capita donators for Ukraine. >
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