Estonian Economy Dips 1.9% in Q1 in Annual Comparison ({{commentsTotal}})


According to the flash estimates of Statistics Estonia, the gross domestic product of Estonia contracted 1.9 percent year-on-year in the first quarter of 2014

However, Annika Laarmaa, the lead statistician and methodologist for the department of economic and environmental statistics at Statistics Estonia, said it is too soon to read too much into the drop.

"These are flash statistics, and we won't put out the final numbers until June 9," Laarmaa told ERR News. "It's quite hard to tell what is going on from it yet."

Marje Josing, the head of the Institute of Economic Research, told ERR radio: "Bad news, but not very unexpected on the backdrop of the current economic climate, if you look at the political events and moods [in Ukraine and Russia]."

The previous time that the GDP fell was in the 1st quarter of 2010.

Compared to the 4th quarter of 2013, the seasonally and working-day adjusted GDP decreased by 1.2%.

Laarmaa said there are normal seasonal adjustments to the flash statistics that are released, but the unusually warm winter Estonian experienced this year fell outside that normal adjustment. Energy was one of the areas that slowed down GDP growth the most, with consumers using less energy, and energy producers importing electricity to replace their own production.

"It's probably cheaper for them to do it that way," Laarmaa said. "It was quite a warm winter, and that naturally causes a drop in the production of heating and need for electrictiy."

Real estate and transport were other areas that saw a year-on-year decrease. The main reason for the deceleration in real estate was an accelerated rise in prices. 

The growth of manufacturing, which is the main contributor to economic growth in Estonia, slowed down mainly due to a decrease in the manufacture of electronic and chemical products. However, the economy was bouyed by the manufacture of wood.

The drop follows a 0.3 percent gain in the 2013 fourth quarter statistics year-on-year. The economy grew 1.3 percent in the same first-quarter statistic last year.

+{{cc.replyToName}} {{cc.body}}
No comments yet.
Logged in as {{user.alias}}. Log out
Login failed

Register user/reset password

Name needs to be fewer than 32 characters long
Comment needs to be fewer than 600 characters long

Independence Day: Estonia’s way into the future isn’t a race

There is a lack of connection between the Estonian state, and the people who live here. While it expects a lot of the state, Estonian society doesn’t seem ready to contribute, writes Viktor Trasberg.

Lotman: Security academy would be crucial Estonian identity point in Narva

In an opinion piece published by Eesti Päevaleht, Tallinn University professor Mihhail Lotman found it important to overcome the mental barrier separating Ida-Viru County from the rest of Estonia.

About us

Staff & contacts | Comments rules

Would you like to contribute an article, a feature, or an opinion piece?

Let us know: