More than €175 million from defense budget reaches Estonian economy in 2021

New EDF conscripts in Jõhvi.
New EDF conscripts in Jõhvi. Source: Marina Loštšina/EDF

Last year, defense investments and economic expenditures by the Ministry of Defense totaled €328 million, 53.5 percent, or €175.5 million, of which made its way back to the Estonian economy, the Ministry of Defense said Friday.

Estonia's 2021 defense budget totaled €645 million, the ministry noted in a press release.

Of the €175.5 million to reach the Estonian economy, €109.2 million was spent on investments and procuring equipment and another €66.3 million was spent on operating costs. In all, goods and services were purchased from 2,231 Estonian companies and institutions.

"It's very important that more than half the money we spend reaches our companies and our economy," said Tiina Uudeberg, undersecretary for defense planning at the Ministry of Defense. "This way, we're supporting the defense industry as well as the local economy."

Personal equipment was purchased entirely from domestic suppliers. In all €4.7 million was spent on the procurement of helmets, helmet covers, protective suits, boots and various uniform elements for regular and field uniforms, pockets and belts.

In terms of the total volume of infrastructure construction and real estate expenditures, 97 percent, or €53.7 million, was carried out by local companies.

A total of 90 percent, or €21.9 million, of vehicle maintenance and repair services were ordered from local companies. Estonian companies rebuild, maintain and repair CV90 armored vehicles, SISU armored personnel carriers as well as wheeled vehicles.

87 percent of catering and food products were ordered from local suppliers as well. Food served in the Estonian Defense Forces' (EDF) canteens, for example, is made primarily from local produce provided by Estonian companies.

Agencies that fall under the area of government of the Defense Ministry likewise have facilities and real estate across Estonia, and the work these properties require likewise goes primarily to local companies and people, Uudeberg added.

Over the last three years, defense investments and economic expenditures amounted to just over €1 billion. Of this amount, €562.5 million has returned to the Estonian economy. The ministry said that a significant share of Estonia's defense spending will continue to reach Estonian companies in the coming years as well.


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Editor: Aili Vahtla

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