The fastest growing markets in Estonia in 2023

2023-11-01 14:52:09

Illustrative photo. Image by Gerd Altmann from Pixabay

For many years, Estonia has been considered one of the best countries for doing business. A favorable geographical location, a developed labor market and competent government regulation contribute to rapid economic growth and open up prospects for new companies. By choosing Estonia to register a business, entrepreneurs have the opportunity to integrate into the European business community.

In particular, modern infrastructure becomes available to companies, which is especially important since the country has a well-developed IT sector. In addition, companies gain access to European markets and can count on special financing conditions from European banks. However, some areas of the economy are developing faster in Estonia than others. So, in addition to IT and telecommunications, the field of online entertainment is rapidly developing here, especially online casinos, as well as the service sector, tourism, construction and many others.

Below we will talk about some of the most promising and fastest growing markets in Estonia in 2023.

Telecommunications and information technology

The field of telecommunications and information technology is considered the most successful and fastest growing segment of the Estonian economy. In just fifteen years, Estonia has become one of the leaders in this industry, and the level of computerization and development of IT communications has increased so much that many actions, from paying for parking to banking transactions, can be easily carried out online.

Developed digital infrastructure and diverse e-governance initiatives contribute to the development of companies and the growth of the country’s economy as a whole. For example, Estonia has an e-Residency program that allows entrepreneurs to register a company remotely and manage it online. Thus, the IT sector is not only an important part of the country’s economy, but it also creates a favorable business environment for the development of companies in all other sectors of the Estonian economy.

Online entertainment

The rapid development of information technology in Estonia has contributed to the growth of the online entertainment market, especially online casinos. This country has a special attitude towards gambling. So, back in 1989, the first casino opened in Tallinn at the Palace Hotel. Since then, the gambling market has begun to actively develop, and Estonia has become associated, among other things, with prestigious casinos.

Competent support of the gambling market from the state contributed to its rapid development. In the early 1900s, casinos and slot machine halls began to appear in various Estonian cities. The first law on gambling was adopted in 1994, it was called the “Law on Lotteries”, and in 1995 the law “On Gambling” appeared.

Today, the gambling market in Estonia is considered one of the fastest growing markets not only in Europe, but throughout the world. European gambling regulations include a well-thought-out legislative framework and an effective monitoring system for market participants. At the same time, it is worth noting that since 2020, the share of land-based casinos in Estonia has been gradually decreasing, and online casinos are occupying an increasingly important place in the structure of the Estonian economy.

According to experts, in 2022 the global gambling market was valued at sixty-three billion dollars, and there is reason to believe that in 2023 this figure will exceed one hundred billion dollars. The Estonian online casino market can be called an example of successful development with government support, so we can expect that this market will continue to grow at a rapid pace.

Services sector

The service sector is another important component of the global economy, and Estonia can also boast of success in this market. Today, a significant part of the country’s population provides various services and it can be said that the service sector is the country’s largest employer. However, as can be expected, this industry is also computerized and many services can be obtained using the Internet.

In addition to traditional types of service provision, such as the catering industry, tourism and transport, Estonia also has a large number of people employed in the public sector. For example, public sector areas such as healthcare, defense and education employ about ten percent of Estonia’s working population. Thus, the civil service is in third place in terms of the number of jobs, behind only industry and trade.

Construction sector and real estate

Construction is also worth mentioning among the rapidly growing sectors of the Estonian economy. The construction sector provides almost a third of the overall economic growth in the Estonian economy. In addition, related areas such as real estate, engineering and architectural firms and others also influence Estonia’s GDP growth.

It is interesting to note that in 2007 the construction sector accounted for no more than ten percent of the Estonian economy. However, in recent years this market has begun to grow at a rapid pace. Reasons for this growth include demographic factors. Representatives of the new generation of independent Estonia are willing to purchase housing and invest money in real estate.

In addition, the development of the real estate market is facilitated by a favorable situation on the Estonian labor market. The country also has fairly low interest rates for mortgage lending. Thus, the high level of employment, rising wages and favorable conditions for housing financing stimulate the development of the Estonian construction market.

Why investors choose Estonia

Estonia not only creates conditions for the development of local business, but also attracts many investors from other countries. First of all, Estonia is a member of the European Union. Accordingly, the principle of investor equality applies here. In addition, European legislation applies here, which allows you to resolve many issues related to doing business easily and quickly.

At the same time, residents of other countries can also register a company in Estonia and there is no need to change citizenship. Investors are also attracted by the opportunity to receive financing for business development from the European Union. In addition to the above reasons, it is also worth remembering the tax advantages.

Among other reasons, registering a company in Estonia may also be an option for immigration to this country. By creating a company, its owner can obtain a residence permit in Estonia, which, in turn, creates additional prospects. Estonia welcomes foreign investors and creates favorable conditions for business development. At the same time, government authorities carefully ensure that all participants act within the legislative framework, which creates guarantees for investors.

The country also has effective budget and tax policies, which ensures that the country maintains a low unemployment rate and provides entrepreneurs with various opportunities to develop their businesses. Estonia’s attractiveness for investors is supported by the fact that a large number of foreign companies operate effectively here. Foreign enterprises are actively integrating into the Estonian economy and contributing to its development. For example, investors often support various local initiatives. In turn, local and state regulatory authorities also ensure that foreign companies receive all the necessary conditions for successful operation on the Estonian market.

This approach has contributed greatly to the fact that Estonia was recently recognized as one of the fastest growing technology centers. According to the Global Startup Ecosystem Report 2023, Estonia was ranked tenth in the ranking of the most favorable ecosystems for startups in the world.

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