Economist: Lack of Monthly Growth in Q2 Due to Sluggish Finnish Economy
Tartu macroeconomics professor Raul Eamets emphasized that behind the second quarter's modest 1.3 percent year-on-year growth, the economy was more or less flat for a second straight quarter.
"It currently seems that this year's economic growth will indeed be more modest than it seemed at first," said Eamets on ERR radio.
External factors are the main reason, said Eamets. "Our trading partners are not doing as well as we are used to. The primary motor behind growth is export."
He said third-quarter growth might come up, if only because people stayed home in an unusually nice summer, and left their money there.
The Latvians are doing better, with 3.8 percent year-on-year growth in the second quarter and an expected 4.2 percent for the year.
Eamets says Latvia's edge is due to its larger domestic market and lower reliance on export. Remittances from abroad also made a difference, he said, in propping up domestic consumer spending.
But Finland is experiencing a sudden recession with recovery expected over a matter of years, not months. "As long as Finland is ailing, so will we be ailing," he said.
Eamets put his own forecast for Estonia's growth this year at 2 to 2.5 percent - still more optimistic than the OECD's 1.5 percent and figures from major international banks.