The Estonian Economy - July 2015
Estonia’s exporters still struggling

• Sluggish export volumes to be expected in 2015
 • Situation across sectors differs
• Growth of exports expected to strengthen in 2016

Sluggish export volumes to be expected in 2015
The growth of exports has been rather modest in recent years. One of the reasons has been weak demand in Estonia’s export markets. Import demand in Latvia and Finland has been stagnant for the past two-three years, and demand in Russia has deteriorated remarkably in 2014-2015.

Situation across sectors differs
The producers of electronics, wood/furniture, and metal products are doing relatively well, while exporters related to the Russian market (dairy, vodka, the oil industry, logistics and tourism) feel the impact of smaller orders from the east. Also, in terms of output prices, some enterprises have been able to ask higher prices for their products (pharmaceuticals, metals, and furniture), while others have had to accommodate not only weak demand but also lower prices (most notably, petroleum products, but also electronics, food, and chemicals).

Growth of exports expected to strengthen in 2016
Sentiment among Estonian manufacturers has deteriorated somewhat this year as export order books are thinner. We expect export demand, as well as export prices, to remain tepid throughout 2015. Demand will weaken in Russia, Latvia, and Lithuania and remain stagnant in Finland this year. Export volumes should pick up in 2016, supported by more robust economic growth among Estonia's trade partners. This should widen export opportunities for Estonian companies and boost export volumes.

PDF The Estonian Economy - July 2015

For more information about this report, please contact Ms. Liis Elmik, liis.elmik@swedbank.ee, +372 888 7206
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