Estonia
| FORECAST* | ||||||
|---|---|---|---|---|---|---|
| Main Economic Indicators | 2021 | 2022 | 2023 | 2024 | 2025 | 2026 |
| Population, 1000 persons | 1331 | 1349 | 1370 | . | . | . |
| GDP, real change in % | 7.2 | -0.5 | -3.0 | 0.2 | 3.2 | 3.6 |
| GDP per capita (EUR at PPP) | 28180 | 30140 | 30670 | . | . | . |
| Gross industrial production, real change in % | 13.3 | 1.8 | -12.3 | . | . | . |
| Unemployment rate - LFS, in %, average | 6.2 | 5.6 | 6.4 | 7.3 | 6.6 | 6.1 |
| Average gross monthly wages, EUR | 1548 | 1645 | 1832 | . | . | . |
| Consumer prices, % p.a. | 4.5 | 19.4 | 9.1 | 3.2 | 2.8 | 2.1 |
| Fiscal balance in % of GDP | -2.5 | -1.0 | -3.4 | -3.4 | -4.5 | -3.6 |
| Public debt in % of GDP | 17.8 | 18.5 | 19.6 | . | . | . |
| Current account in % of GDP | -2.6 | -3.2 | -2.1 | -2.0 | -2.2 | -1.9 |
| FDI inflow, EUR m | 6322 | 1696 | 4878 | . | . | . |
| Gross external debt in % of GDP | 85.1 | 84.7 | 90.4 | . | . | . |
Basic data are continuously updated.
* Forecasts are changed beginning of January, April, July and November.
See Press Conferences.
publication_icon
Monthly Report No. 7-8/2024
Vasily Astrov, Alexandra Bykova, Rumen Dobrinsky, Selena Duraković, Meryem Gökten, Richard Grieveson, Doris Hanzl-Weiss, Gabor Hunya, Branimir Jovanović, Niko Korpar, Sebastian Leitner, Isilda Mara, Olga Pindyuk, Sandor Richter, Bernd Christoph Ströhm, Maryna Tverdostup, Zuzana Zavarská and Adam Żurawski
wiiw Monthly Report No. 7-8, July-August 2024
45 pages including 5 Tables and 12 Figures
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Executive summary
Olga Pindyuk
in: The Crisis is Over, but its Scarring Effects are Hindering Recovery
wiiw Forecast Report No. Spring 2024, April 2024 , pp. I-VII
Details
After two years of continuous recession, the Estonian economy is finally perking up. In Q1 2024, the economy experienced a 2.4% decline year on year, yet this was less than in previous quarters. The downturn was still driven by the lengthy slump in the energy and manufacturing sectors. Recent months have been marked by a stabilisation of business sentiment, prices and private consumption, as well as by notable improvements in both foreign and domestic corporate investment. Thus, growth prospects for the second half of the year appear more positive, as demand in the main export markets, including Scandinavia, gradually picks up and the distorting effects of the energy crisis wear off. Thus, we expect the economy to stagnate this year, but then to see a rapid improvement – to 3.2% in 2025 and 3.6% in 2026. Despite a sizeable plunge in energy prices, inflation is forecast to stay at around 3.2% this year, with subsequent declines to 2.8% in 2025 and 2.1% in 2026. The labour market remains resilient, as the upsurge in unemployment during the first quarter was mainly fuelled by an increase in the workforce. Unemployment is expected to reach 7.3% overall in 2024, as companies remain reluctant to hire new workers. However, it will decline steadily in coming years, in response to strengthening demand and expanding production. The budget deficit will remain at above 3% throughout the forecast period, driven by steadily high government spending on defence and a reduction in personal income tax planned for next year.