Two years after a Tallinn panel asked whether Estonia remains an attractive destination for investors, the verdict is broadly unchanged – but the doubts have sharpened; the debate revealed a country still trading on speed, talent and quality of life, while wrestling with war-risk perception, tighter bureaucracy and a looming shortage of engineers.
In a Tallinn hotel ballroom in March 2024, the French-Estonian Chamber of Commerce and Industry posed a question that sounded almost quaintly binary: is Estonia still worth investing in? The audience – entrepreneurs, executives and diplomats – voted overwhelmingly “yes”. Yet the most revealing detail came later, after an hour of debate about war-risk perception, taxes, talent and bureaucracy: the “yes” vote barely moved. What changed was the number of people who shifted into doubt.
Before the panel, 72 per cent said Estonia was still worth investing in, 17 per cent said “maybe” and 11 per cent said “no”. Afterwards, the “yes” rose marginally to 74 per cent, but the “maybe” climbed to 20 per cent, and the “no” fell to 6 per cent.
That inching of uncertainty – rather than any collapse in confidence – captured the mood of a country whose economic story has often been told as a clean line from post-Soviet shock to digital state, from Skype to the startup nation. Two years on, it reads less like conference theatre and more like a snapshot of a deeper transition: Estonia is still investable, the panel suggested, but the terms of the bet have changed.
Tallinn’s old advantage: speed. Its new risk: friction
Estonia’s modern investment pitch has never been natural resources or market size. “We don’t really have any natural resources. We don’t have anything else but the people,” said Helery Pops, an investor at Practica Capital. That line – half lament, half strategy – has long sat at the heart of Estonia’s “digital republic” brand: educate, connect, build and export.
But the debate repeatedly returned to something less glamorous: the creeping sense that the machinery of the state is slowing, and that the country’s famous ease of doing business is becoming more conditional.
Thomas Padovani, co-founder of AdCash and a long-time investor in Estonia, described an economy whose financial infrastructure felt increasingly out of reach for precisely the people Estonia has wanted to attract. He argued that foreign-owned banks dominate the market and that fintech licensing has become harder rather than easier. “It’s become absolutely horrible to open a bank account,” he said, particularly for foreigners, pointing to the knock-on effects for startups operating globally.
For Padovani, the issue was not ideology but predictability: the fear that Estonia might drift towards the habits of “old Europe” – slower processes, more opaque rules and more bureaucracy – while still relying on the narrative of speed that built its reputation. “Interpretation of law changed,” he said, suggesting that what once felt clear and responsive now felt uncertain.
Piret Mürk-Dubout, a Tallink board member, expressed the same concern more diplomatically. “We from the entrepreneur side have just one request for all the politicians: please don’t mess up the business,” she said. The competitive edge, she argued, lay in agility – and in keeping life and business “easy” in a small country at the edge of Europe.
War next door, and the problem of perception
The geopolitical question hovered over the evening like weather. Estonia sits on NATO’s eastern flank; after Russia’s full-scale invasion of Ukraine, investment committees and tourists alike began treating maps as risk models.
Panelists did not deny that the war had changed the mood. “When you look at the map of the world, for Portugal, we’re almost in the war,” Mürk-Dubout said, describing how the region’s perceived proximity to conflict could unsettle investors and visitors.
But the bluntest intervention came from France’s ambassador, Emmanuel Mignot, who called the fear overblown. The perception problem, he suggested, needed countering with clarity. Saying one should not invest in Estonia because it is close to Ukraine, he argued, is “as absurd as saying we don’t invest in Dubai because it’s war in Gaza”.
He went further, telling the room that the Russian threat to Estonia was not imminent. The larger point was strategic: if there were a war on Estonian territory, it would not be a regional incident but a wider conflict involving NATO and the EU – and “companies would not invest in Portugal either”.
That argument – half reassurance, half warning – framed Estonia’s central communications challenge: it must sell itself as both a frontline state and a normal European place to build a business, without sounding either frightened or complacent.
A country rich in engineers – and anxious about running out of them
If security was the external risk, talent was the internal one. Pops pushed the discussion away from the familiar roll-call of Estonia’s software successes – Skype, Wise, Pipedrive – towards deep tech and hardware. Estonia, she suggested, must start “building things you can touch with your hands”.
Her worry was practical. “The statistics [say] that in a few years we will be missing 70 per cent of engineers that we need here in Estonia,” she said, arguing that the country’s ambitions in energy, defence and industrial innovation are constrained by the supply of engineers and the pipeline of maths and science education.
The panel did not offer a neat solution – and that, too, was telling. Andres Sutt, a member of the Estonian parliament, Riigikogu (energy and environment minister as of 2026), admitted the core question was motivational: why do young people avoid studying maths, physics and engineering? “You can’t by force put anybody to study math,” he said.
The audience provided the simplest answer: “It’s too difficult,” one participant said. Padovani offered a different incentive. “Pay them more.”
Sutt broadened the argument to the coming disruption of artificial intelligence. The most important skill, he suggested, is learning to use AI as a tool. If Estonia can integrate this into education and work – particularly in teaching itself – it may blunt the shortage of specialists and preserve its edge.
The optimism case: the numbers, the energy bet, and quality of life
Sutt also represented the optimistic reading of Estonia’s trajectory – a reading grounded in macro figures and long-run comparisons. The country had reached GDP per capita comparable, by some measures, to parts of southern Europe, and foreign investment decisions continued to land in Estonia despite bleak headlines.
He cited major projects and argued that talk of collapse in the startup ecosystem ignored context: the downturn year was still among the strongest on record. For energy-intensive investment, he said, the biggest hurdle was the price and composition of electricity – and he predicted that would change. “We are going to see a major investment in the energy sector,” he told the room.
His broader pitch was not fiscal but civic: Estonia’s quality of life. An airport close to the city, forests, less congestion than most capitals – these things matter to investors who are also humans. The problem, he implied, was not Estonia’s fundamentals but its mindset: a habit of talking itself down.
Mürk-Dubout made a related point from a business development angle. Connectivity – physical and relational – is itself an economic strategy. She spoke of building trade networks, tourism links and the soft infrastructure that turns visitors into repeat partners. Estonia, she said, was “the best place to raise your kids” – a phrase that works less as sentiment than as a statement about stability.
So what does “worth investing in” mean now?
Towards the end, a member of the audience – leadership trainer Ave Peetri – punctured the tone of blame and demanded something more useful: what are you doing to make Estonia worth investing in?
That question forced the panel to reveal what had been implicit all along. Nobody in the room was actually waiting for a perfect government or a frictionless economy. They were weighing whether Estonia would remain a place where competence is rewarded, where systems work at speed, and where talent can stay, arrive and grow.
When asked where the future lies, the answers converged. Mürk-Dubout pointed to circular economy and green tech, biotechnology and pharmaceuticals, and – reluctantly, given the times – defence-related innovation. Pops argued that a surge of funding would steer new engineering talent into green tech, and said Estonia’s relationships with Ukraine may offer a practical advantage in defence innovation, particularly in areas like low-cost drones. Padovani counselled sticking to Estonia’s core strengths: software, services, exportable products, and not damaging the conditions that made those sectors flourish in the first place.
The real lesson of that March 2024 evening is that Estonia’s investment story is no longer a slogan about being digital and fast. It is a contest between two futures: one in which the country stays legible, efficient and talent-rich – and another in which it becomes just another small European economy with good branding and slow systems.
Two years on, the vote would probably still land on “yes”. The question is how long Estonia can afford to live with “maybe” rising quietly in the background.
