Estonia's Growth Cycle to Take Off After a New Surge in Exports

Article published on Nov. 3, 2008
community published
Article published on Nov. 3, 2008
Martin Lindpere, economist of Eesti Pank, gave a presentation at the conference dedicated to the 15th anniversary of the Chamber of Notaries, saying Estonia is in urgent need of stronger export capacity.

Lindpere said in his presentation covering Estonia's current economic situation and future outlooks that the economic downturn is likely to last longer in domestically orientated market segments and that a new growth cycle will be able to take off only after an increase in exports growth. "Therefore it is important that the world's leading economies as well as our main foreign trading partners soon recover their normal growth," Lindpere said. 

When speaking about the main issues regarding the next years, Lindpere emphasised that although the economy will have to manage with lesser loan resources, it is imperative to maintain competitiveness. "Estonia's economy will have to recover from the growth period that was heavily relying on strong financial leveraging. An economic downturn does not entail just threats, it should be taken as an opportunity," he said, adding that it is important to avoid pessimism. 

According to Lindpere, another factor paving way for economic recovery is a flexible labour market allowing people to move easily from less productive to more productive sectors. 

"The adoption of the euro would also contribute to our economic success. The single European currency would mitigate risks to Estonia's economy and enhance remarkably our growth potential," Lindpere said and added that in this respect it should be closely monitored that Estonia's next years' state budget would be at least in balance.