The OECD growth forecast for next year was increased by 0.2 percent to 3.3 percent, while the forecast for economic growth in 2019 should total three percent, the organization said in its fresh economic outlook on Tuesday.

"The OECD forecast coincides with the forecast of the Ministry of Finance," Minister of Finance Toomas Tõniste (IRL) said in a press release. "Our economy is growing and the state's finances are in order."

According to the OECD, private as well as public sector investments have grown and are supported by payments of EU funds.

Increasing the pension age and continuing with the nationwide work ability reform will increase access to labor. Skills shortages have emerged in some sectors and, despite increasing labor market participation, buoyant economic activity will induce further tensions on the labor market. Wages will continue to grow at a high pace, weighing on exporters' price competitiveness and impeding gains in export market shares. Supporting the employment of women with children, improving the relevance and quality of adult education, and facilitating skilled migration, however, could ease labor market bottlenecks, the OECD said.

Consumer confidence has improved, signifying more robust household spending. Raising the tax-free income to €500 will also boost households' purchasing power.

The fiscal balance is reasonable in the present economic cycle and remains below one percent. As the economy is reaching its potential, all public spending should focus on measures which would boost possible growth and reduce the risk of overheating.

The OECD expects consumer prices in Estonia to grow 3.7 percent this year, 3.3 percent next year and 2.8 percent in 2019. The unemployment rate, meanwhile, is forecast to reach 6.9 percent in 2017, 7.6 percent next year and 7.7 percent in 2019.

The global economy is forecast to grow 3.6 percent this year, 3.7 percent next year and 3.6 percent in 2019, while he OECD expects the eurozone's economy to grow 2.4 percent, 2.1 percent and 1.9 percent, respectively.