The seasonally and working-day adjusted GDP fell by 0.5 percent between Q4 2023 and Q1 2024, and by 2.1 percent on year to Q1 2024.

Robert Müürsepp, Statistics Estonia's national accounts team lead, said that while the economy had demonstrated some signs of recovery compared with 2023, "compared with Q4 2023, there were no significant changes in trends."

"There were still few economic activities with a positive contribution to the GDP," Müürsepp added.

"Net taxes on production had a positive impact despite the increased VAT rate. There is a very simple reason for this: In Q1 2023, the payment of energy subsidies had the effect of diminishing net taxes on production, but these subsidies were no longer available this year," he continued, referring to support measures put in place at a time of soaring energy prices.

The most significant contributor, for the second quarter in-a-row, came from the agriculture, forestry and fishing sectors, the agency added.

Real estate activities, public administration and defense, while they made more modest contributions, were also significant.

As for the most significant negative contributions, energy supply and manufacturing stood out, Statistics Estonia reported, while professional, scientific and technical activities, and also trade, also exerted a strong negative impact on the Estonian economy.

The performance of the transport, construction, and ICT sectors hampered economic growth only marginally, the agency says.

Value added, meaning total output of enterprises minus production input values, fell by 3.7 percent in total, on year to Q1 2024.

The greatest impact was exerted by the non-financial corporations, where value added fell by 5.3 percent, Statistics Estonia says.

The value added from the financial sector decreased by 4.6 percent, while the general government (which rose by 3.9 percent) and non-profit institutions (up 3.6 percent) sectors made a positive contribution over the same time-frame.

Private consumption had grown a little as of Q4 2023, but this fell by 1.4 percent in Q1 2024.

Statistics Estonia reports a considerable rise in just two expenditure categories: Education, and restaurants and hotels.

Expenditures on clothing and footwear, alcoholic beverages and tobacco, furnishings, and transport all fell significantly on year to Q1 2024, the agency says.

Statistics Estonia reports that in Q1 2024, investments showed growth for the third consecutive quarter, up by 11.1 percent on year, primarily thanks to business investments in other buildings and structures (which rose by 41 percent) and in machinery and equipment (up 21.9 percent).

The biggest negative impact derived from households' investments in dwellings (down by 9.2 percent), the agency says.

Foreign trade

In trade in goods, both exports and imports were down by about 10 percent, which was primarily due to trade in electricity and the manufacture of wooden items.

Foreign trade has been in decline for 18 months now. Exports fell by 7.8 percent in Q1 2024, though net exports remained positive, g imports decreased by 6.7 percent.

 As for trade in services, exports fell by 2.2 percent while imports grew by 2.2 percent, between Q1 2023 and Q1 2024.

Exports of services were affected by sea and rail transport, while imports were boosted by the increased purchases of construction services, the agency says.

Statistics Estonia compiled the above research on behalf of the Ministry of Finance.

More detailed information from Statistics Estonia is available here and here.

--

Follow ERR News on Facebook and Twitter and never miss an update!