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The northernmost state in the Baltic region has a Scandinavian atmosphere. In fact, a German-Baltic upper class of merchants dominated public life for 800 years until the 19th century. Even under subsequent Russian rule, the western influence remained strong, especially as German was spoken at the University of Tallinn until 1870. Perhaps this is the reason why Estonia orientated itself towards the West after the collapse of the Soviet Union and above all sought proximity to its Nordic neighbours. Favoured by long-standing business relationships, cultural ties and geographical proximity, the neighbouring countries are key trading partners today.
With its focus on innovative IT and industrial solutions, Estonia has established a technological lead, which is underlined by the introduction of a fully digitalised administration for the first time in Europe. The use of digital programmes is also always in line with Estonian civil society, which can act as a driver of digital change thanks to everyone's right to Internet access and over 1,300 hotspots distributed throughout the country. The country is not only thinking digitally in terms of administration, but also in terms of the digital transformation of industry (Industry 4.0). First-class IT expertise and R&D make the e-state a leading provider in the areas of cyber security, high-tech systems and cotroll technologies. The excellent ecosystem for innovation and investment has long since spread to other industrial sectors such as electrical engineering and electronics, transport and logistics and the automotive industry in the form of sustainable industrial automation. Attractive tax models and a market-liberal legal framework enable good business in the wood and furniture industry, paper industry, food industry and maritime industry.
Facts
- Total population: 1.3 million (2024)
- Area: 45 228 km²
- Capital: Tallinn
- Neighbouring countries: Latvia, Russia, Finland (by sea)
- Business languages: Estonian, English, Russian, Finnish, German
- Currency: Euro since 1 January 2011; previously Estonian kroon (EEK)
- System of government: Parliamentary democracy
- Head of state: President of the Republic Alar Karis, assumes office on 11 October 2021
- Head of government: Prime Minister Kristen Michal (liberal Estonian Reform Party), assumes office on 23 July 2024
- Parliament: Unicameral parliament ‘Riigikogu’, 101 deputies
Economy
- GDP 2023: EUR 41bn
- GDP per capita 2023: EUR 20,245
- Inflation rate 2023: 9.1%
- Public debt 2023: 19,6%
- Unemployment rate 2023: 6.4%
- Imports 2023: EUR 21.1 billion
- Exports 2023: EUR 18.2 billion
- Ease of Doing Business 2020: 18th place out of 190 evaluated countries
- World Competitiveness Ranking 2024: 33rd place out of 67 countries
- Corruption Perception Index 2023: 12th place out of 180 countries evaluated
Infrastructure
From Berlin to Tallinn in next to no time - and even further to Helsinki in Finland. That is the idea behind the ambitious Rail Baltica railway construction project. The idea was born back in 2001.
After several delays, Rail Baltica is now finally on track. From 2025, the railway will connect Berlin, Kaunas, Riga and Tallinn on a high-speed line (at least 200249 km/h in passenger transport) over 870 kilometres. The gap to Warsaw should also be closed by 2030. The line is being developed in the standard gauge of 1,435 mm common in Western Europe, not in the old Russian broad gauge of 1,524 mm as is usual in the Baltic states.
The multinational project is intended to achieve considerable time savings not only for passenger transport, but above all for freight transport. At the beginning of 2017, the three Baltic states signed the Rail Baltika Agreement, which sets out the exact route, technical data and deadlines. The EU is supporting the project as part of the CEF programme.
History
During the turmoil of the Second World War, Estonia first came under Soviet rule, then under German rule and finally under Soviet rule again. As part of the Soviet Union, the Estonian SSR was henceforth controlled by the Kremlin. Several tens of thousands of Estonians were deported between 1940 and Stalin's death - around 20,000 in March 1949 alone. 200,000 Russian workers were resettled as part of Moscow's Russification policy, which is the basis for the strong Russian minority in the country.
1991 saw the collapse of the USSR and the founding of the second Estonian Republic as part of the Singing Revolution. Estonia has been officially independent again since 20 August 1991. This was followed by membership of the UN and the Council of Europe, and finally the EU and NATO in 2004. Estonia has been part of the eurozone since 2011.