Creative Industries Estonia
Population: 1,251,581 (July 2017 est.)
Internet country code: .ee
three equal horizontal bands of blue (top), black, and white; various interpretations are linked to the flag colors; blue represents faith, loyalty, and devotion, while also reminiscent of the sky, sea, and lakes of the country; black symbolizes the soil of the country and the dark past and suffering endured by the Estonian people; white refers to the striving towards enlightenment and virtue, and is the color of birch bark and snow, as well as summer nights illuminated by the midnight sun
Republic of Estonia / Eesti Vabariik
After centuries of Danish, Swedish, German, and Russian rule, Estonia attained independence in 1918. Forcibly incorporated into the USSR in 1940 – an action never recognized by the US – it regained its freedom in 1991 with the collapse of the Soviet Union. Since the last Russian troops left in 1994, Estonia has been free to promote economic and political ties with the West. It joined both NATO and the EU in the spring of 2004, formally joined the OECD in late 2010, and adopted the euro as its official currency on 1 January 2011.
Estonia, a member of the EU since 2004 and the euro zone since 2011, has a modern market-based economy and one of the higher per capita income levels in Central Europe and the Baltic region, but its economy is highly dependent on trade, leaving it vulnerable to external shocks. Estonia’s successive governments have pursued a free market, pro-business economic agenda, and sound fiscal policies that have resulted in balanced budgets and the lowest debt-to-GDP ratio in the EU.
The economy benefits from strong electronics and telecommunications sectors and strong trade ties with Finland, Sweden, Germany, and Russia. The economy’s 4.9% GDP growth in 2017 was the fastest in the past six years, leaving the Estonian economy in its best position since the financial crisis 10 years ago. For the first time in many years, labor productivity increased faster than labor costs in 2017. Inflation also rose in 2017 to 3.5% alongside increased global prices for food and energy, which make up a large share of Estonia’s consumption basket.
Estonia is challenged by a shortage of labor, both skilled and unskilled, although the government has amended its immigration law to allow easier hiring of highly qualified foreign workers, and wage growth that outpaces productivity gains. The government is also pursuing efforts to boost productivity growth with a focus on innovations that emphasize technology start-ups and e-commerce.