According to data provided by Statistics Estonia and Bank of Estonia (Eesti Pank), in the second quarter (Q2) of 2022, Estonia's service exports grew by 32 percent, while service imports fell by 5 percent on year. In the second quarter of 2020, Estonia's service exports totaled €2.5 billion, while imports were €1.8 billion.
The balance of foreign trade in services for Q2 was €658 million in surplus, with the only period in recent years with a higher surplus being Q4 of 2021. Continuing the trend seen in the first quarter of the year, Estonia's trade surplus was mainly due to increased exports of travel services and decreased imports of telecommunications, computer and information services.
Jane Leppmets, analyst at Statistics Estonia, said that the foreign trade balance of services was positive in both the first and the second quarters of 2022, as Estonian enterprises supplied more services to non-residents than they purchased from them. "When it comes to trade in services, exports usually exceed imports, which offsets the negative balance of trade in goods," said Leppmets.
The quarter saw increases in service exports to both EU and non-EU countries. However, service imports from EU countries decreased, mainly due to falling purchases from Germany, which were down by €586 million on year. At the same time, there was a growth in services bought by non-EU countries, which accounted for 65 percent of the total service exports and 73 percent of service imports during Q2.
Estonia's most exported services in Q2 were transport services, other business services, and telecommunications, computer and information services. Compared to the second quarter of 2021, the biggest increase occurred in the export of travel services, which increased by €251 million on year. There was also a rise in the exports of telecommunications, computer and information services (up by €140 million), and transport services, which grew by €112 million. The only decreases were recorded in the export of charges for the use of intellectual property, maintenance and repair services, and manufacturing services.
Finland was again Estonia's top partner country for service exports in Q2, with travel and transport the main services provided. Finland was followed by Sweden, where transport services accounted for the highest level of exports from Estonia, and the USA, where Estonian enterprises primarily exported telecommunications, computer and information services.
In the second quarter, the biggest increase was seen in exports to Latvia, where other business services, including professional and management consulting services, as well as travel services grew the most. The second largest increase was in exports to Finland, as a result of higher exports of travel and transport services. This was followed by service exports to the Netherlands, where Estonian enterprises supplied a greater amount of other business services and transport services than before.
The main services imported to Estonia in the second quarter were transport services, telecommunications, computer and information services, and other business services. Compared to the second quarter of 2021, the biggest rise was seen in the import of travel services (up by €163 million), transport services (up by €118 million) and other business services (up by €98 million). The import of telecommunications, computer and information services saw the biggest drop on year (down by €498 million), due the high levels reached in 2021.
Estonia's top partner country for service imports was Finland, which mainly supplied transport and travel services. Finland was followed by Germany and Lithuania, with transport and other business services the main types of services supplied by these countries. The biggest rise in imports from a partner country in Q2 was from Ireland, as a result of the increase in purchases of other business services. Finland also considerably increased its spending on transport services from Estonia.
More information about Estonia's service exports and imports can be found here.
Editor: Michael Cole