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“The prospects of the Estonian economy are good. According to several indicators, the economy is recovering,” said Keldo. “The growth of exports, and retail, along with a revived lending market indicate that the situation has been improving since mid-last year. According to the October confidence indicator of the Estonian Institute of Economic Research, consumer confidence has reached its highest level in the past 15 months. I admit that it remains low, but the trend is clearly gradually moving in a positive direction.”
According to the minister, experts also express optimism. “According to the forecast of the Bank of Estonia, the economy will grow by 0.6% this year and over 3% in the coming years. As an optimist, I believe that we will recover this year and that growth will accelerate even more in the coming years. We have the prerequisites to become one of the fastest growing and developing economies in the region and, in fact, in the whole of Europe,” he said.
Keldo pointed out that sustainable economic development started with security. He stated that we ranked among the first in investing in national defence, planning to allocate at least 5% of GDP to defence capabilities in the future. He said that these investments strengthened national defence while also supporting the domestic economy – the previous year, the contribution of defence spending to the economy had reached a record 490 million euros.
According to Keldo, in order to make the economy and business environment more competitive, it is planned to simplify procedures for companies by reducing unnecessary bureaucracy and replacing reports that create a heavy administrative burden with an automatic flow of data between the state and businesses. Efforts are also being made to bring European Union funding and investments into Estonia.
“If we allow entrepreneurship to grow, the economy can grow more rapidly as well. Estonia’s competitiveness and prosperity will increase when the industry becomes smarter and more knowledge-based. This implies digitalisation, automation, and increased investment into research and development,” Keldo stressed. He also pointed out the importance of the export growth and the role of state representatives in promoting the country and facilitating access to new markets.
In terms of challenges, Keldo mentioned the young people who neither study nor work. “During 2023–2024, the youth unemployment rate in Estonia grew the fastest in the European Union. This points to the need to focus on engaging young people and implementing preventive measures to maintain a positive labour market trend in the long term,” he said. According to the minister, in order to reduce the youth unemployment rate, work regulations have to be flexible and free of bureaucracy for both young people and employers.
Keldo stressed that while modernising the labour market, one must also pay attention to ensuring equal opportunities for all in various spheres of life. “People doing equal work should receive equal pay. In the past ten years, the gender pay gap has decreased by over 40%. However, over the last three years the decline has slowed,” he said. Keldo added that employers could analyse the pay gap in their companies using the digital tool Palgapeegel (Salary Mirror).
In conclusion, the minister said that in order to grow, the economy needed consistent action on multiple fronts, and we all had a role to play in this.
During the debate, Õnne Pillak took the floor on behalf of the Estonian Reform Party Group, Rain Epler on behalf of the Estonian Conservative People’s Party Group, Jaak Aab on behalf of the Social Democratic Party Group, and Aleksandr Tšaplõgin on behalf of the Estonian Centre Party Group.
The deliberation of a Bill was adjourned
Due to the end of the working hours of the sitting, the first reading of the Draft Resolution of the Riigikogu “Making a proposal to the Government of the Republic to develop an urgent suspension of online voting” (679 OE), submitted by the Estonian Centre Party Group, was adjourned.
The Draft Resolution proposes to suspend the online voting in Estonia until the deficiencies in the control systems are addressed. The explanatory memorandum refers to the 2025 legal assessment of Estonia’s online voting by the OSCE Office for Democratic Institutions and Human Rights (ODIHR), which acknowledges the progress made but also points out shortcomings.
Verbatim record of the sitting (in Estonian)6
Video recording of the sitting will be available on the Riigikogu YouTube channel.
Riigikogu Press Service
Merilin Kruuse
+372 631 6592; +372 510 6179
merilin.kruuse@riigikogu.ee
Questions: press@riigikogu.ee
Link uudisele: The Riigikogu heard the annual report by Minister of Economy and Industry
Source: Parliament of Estonia