Estonia's economy will continue to decline in the first half of 2023, Swedbank's chief economist Tõnu Mertsina said. The economy dropped by 3 percent in the last quarter of 2022 new data showed on Friday.
Statistics Estonia's findings were expected, Friday's "Aktuaalne kaamera" recorded. The Bank of Estonia had already predicted a 0.5 percent economic decline and SEB a drop of 0.4 percent.
Mertsina said: "This was also the order of magnitude of our forecast. In our last economic forecast, we predicted that last year's recession would be 0.4 percent."
He said the recession is not over yet.
"Given that the recession deepened in the fourth quarter, this also suggests that the Estonian economy is likely to continue contracting in the first half of this year," the expert said.
In December, retail turnover also fell by 7 percent compared to the year before, Statistics Estonia said in their flash estimate. The agency's final report will be released on March 1.
AK spoke to Prisma procurement director Kaimo Niitaru about how customers' shopping trends have been affected.
"Indeed, the last quarter showed that fresh produce, especially fruit and vegetables, milk, fresh meat, which perhaps also suffered the most from price increases, took a bigger hit in terms of [sales] volume," said Niitaru.
"What the customer surveys have revealed is that 64 percent of people have had to change their shopping habits in the fourth quarter. Looking at what to buy, at what price, looking for bargains. And 15 percent of respondents said they have had to give up certain categories of goods altogether," he added.
Estonia's economic growth for 2023 is forecast to be just above zero this year.
Editor: Merili Nael, Helen Wright
Source: Aktuaalne kaamera