According to the preliminary data of Statistics Estonia, the country’s statistics agency, in the fourth quarter of 2021, the gross domestic product that shows how the Estonian economy is doing, grew by 8.6% compared with the same period of 2020; the GDP at current prices was €8.7 billion.
Robert Müürsepp, a leading analyst at Statistics Estonia, said the economy maintained rapid growth in the last quarter of 2021. “The growth was still broad-based, but several economic activities were affected by soaring prices,” Müürsepp noted.
The growth was driven by manufacturing which climbed back to the pre-pandemic level. The economy was also boosted by information and communication, transportation and storage, and professional, scientific and technical activities, the statistics agency said.
“Accommodation and food service activities, which have been ravaged by the coronavirus crisis, continued to grow at a very rapid rate. The main activities that hampered economic growth were trade and agriculture due to price increases in these sectors. The energy sector remained at the same level year on year despite the increase in prices,” according to the agency.
Investments fall significantly
Müürsepp said the price changes were also reflected in private consumption that rose by 6.9%.
“There was a fast growth, but it was significantly slower than in previous periods. The lifting of coronavirus-related restrictions had a noticeable impact. The biggest rise was recorded in people’s expenditures on restaurants and hotels, communication, and clothing and footwear. There was also increased spending on transport, health, and leisure and culture,” he added.
Investments fell by 38.4%, but this was due to the exceptionally high reference base, the agency said.
“The fall was mainly the result of the decrease in enterprises’ investments in computer software and databases (-93.9%). There was also a decrease in households’ investments in dwellings (-12.6%). On the other hand, the biggest growth was recorded in enterprises’ investments in transport equipment (36.2%) and in other machinery and equipment and weapons systems (12.4%).”
The growth exceeds pre-pandemic levels
In the fourth quarter of 2021, exports grew by 22.6%, primarily driven by the sale of licence fees and transport services. The fall in the imports of computer services led to a decline in imports (-2.6%). Foreign trade also received a significant boost from trade in crude petroleum and natural gas, electricity, articles of wood and cork, and travel services.
According to seasonally adjusted data, the GDP growth was 1.8% compared with the third quarter of 2021 and 8.8% compared with the fourth quarter of 2020.
In 2021 as a whole, the economy grew by 8.3%. Compared with 2019, the economy grew by 5.2%, thereby exceeding pre-pandemic levels.