Proximity to the Nordic markets, location between Eastern and Western Europe, competitive cost structure and high-skill labour force have been the major Estonian comparative advantages since the 1990’s. As a member of the European Union, Estonia today obviously enjoys free trade within the Union, and full participation of external trade agreements signed by the Union.
As of May 1, 2004 external trade relations of Estonia with third countries are based on the EU Common Commercial policy. All bilateral free trade agreements between Estonia and third countries were denunciated. As of the same date Estonia implements the conditions set out in the trade agreements between EU and third countries and applies with the EU commitments taken in the WTO. Membership in the WTO and in the EU promotes foreign investments to Estonia as well as increases the security of both foreign and Estonian entrepreneurs by creating a reliable framework for implementing national economic and trade policies..
The value of Estonian foreign trade in 2007 was 19.3 billion EUR, of which exports accounted for 8.0 billion EUR, and imports 11.3 billion EUR. Compared to 2006, this meant an increase in the trade value of 4.9% (exports +3.7%, imports +5.8%). Although in the second half of 2008 the volumes of goods and services exported increased to an extent due to the base effect, the exports in fixed prices decreased by 1,1% as the total of the year. Considering the flexibility of enterprises, their relatively fast reorientation ability and gradual recovery of the import demand of the closest neighbours of Estonia, more rapid growth in the export sector is expected starting from 2010.
More Information on FDI
Bank of Estonia: www.eestipank.info/frontpage/en/
Ministry of Foreign Affairs: www.mfa.ee/eng/
Centre of Registers and Information Systems: www.rik.ee/33167/
Tallinn City Web for Investors: www.tallinn.ee/ettevotjale
