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EKI sets 2018 economic growth forecast at 4%

Euros. Source: (Marco Verch/Wikimedia Commons)

The Estonian Institute of Economic Research (EKI) has set its economic growth forecast for this year at 4%.

EKI announced in its second-quarter economic survey that Estonia's economic situation remains good. Statistics from the first quarter indicate that the year began with 3.6% economic growth, which has been supported by a favourable monetary policy environment and fiscal policy.

Compared to last year, the experts at EKI are of the opinion that Estonia's current economic situation has improved, and based on the survey, the favourable economic situation is set to last through the end of the year.

According to EKI data, inflation is expected to slow down at the end of this year, while interest rates and stock prices are to go up. EKI is forecasting an average increase in inflation of 3.1%. Last year, in comparison, Estonia saw inflation increase at 3.4%.

The largest three economic issues currently facing Estonia, according to the institute, remain a lack of innovation, a shortage of skilled labour as well as insufficient international competitiveness.

EKI is forecasting a moderate increase in the unemployment rate over the coming years, which it estimates to be 7.2% this year.

The institute expects the average monthly wage in Estonia to total €1,290 this year, up from €1,221 last year.

Estonian competitiveness down

The International Institute for Management Development (IMD) in May published the 30th edition of its World Competitiveness Yearbook, according to the results of which Estonia dropped one spot on year to 31st place.

Of EU member states, Estonia was ranked 13th this year, remaining unchanged from last year.

Editor: Aili Vahtla

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