Estonia Tipped for Fastest-Growing Eurozone Economy

Estonia's growth will continue to be driven largely by exports, forecasters predict. (Postimees/Scanpix)
4/5/2011 1:12 PM
Category: Economy

A forecast by the consultancy firm Ernst & Young predicts that Estonia will be the Eurozone's leader in economic growth over the next five years.

Ernst & Young's economic forecast for the Eurozone, which it is publishing in cooperation with Oxford Economics, will be released today, April 5. For the first time it includes an entire section devoted to the development of the Estonian economy, uudised.err.ee reported.

Ivar Kiigemägi, an audit partner at Ernst & Young Baltic, told ETV that while the general economic backdrop in Europe is rather complicated, the Estonian economy has come out as the one that will grow the most rapidly in the next five years.

Although the level of unemployment in Estonia is currently one of the highest in the EU, the situation should improve markedly over the next five years, reaching the EU average, said Kiigemägi.

He noted that the main driver for the growth in Estonia, as well as in other EU countries, would likely be increased exports.

Kiigemägi said that the development of processing industries and obtaining subcontracts from Scandinavian companies would help pull the country further out of the crisis and create jobs.

"On the other hand, there's a certain risk that we are too strongly connected with the economies of Scandinavia and Finland. How things go with us depend on how things go with them. So far it's gone well with them, they have begun to grow, but we are still very much connected to them," he warned.

In a separate interview with ERR radio, Kiigemägi said that the economic growth forecast for this year was 4.3 percent, and just under 5 percent for the next five years.

 

Steve Roman


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