OECD estimates Estonia's economy to grow 2.2 pct22 May 2012
The Organization for Economic Cooperation and Development (OECD) in its spring economic forecast published on Tuesday expects the Estonian economy to grow 2.2 percent this year and 3.6 percent in 2013, rates that are respectively 0.5 and 0.6 points more optimistic than the latest estimate by the Estonian Finance Ministry.
The growth estimate held out by the OECD for Estonia for next year is the fastest in the eurozone, the Estonian Finance Ministry said.
Compared to the OECD autumn forecast, global growth outlooks have deteriorated and the growth forecast for Estonia has been cut back among others in connection with the uncertain situation of the world economy. The OECD expects growth of the global economy and the economy of Estonia to increase in 2013.
"The positive assessments and forecast by the OECD work as a significant relief against the background of overall uncertainty. We, too, are aware that external environment is our main risk, but we depend most directly on the Nordic countries, the resilience of whose economy is stronger than in Europe on the whole," said Minister of Finance Jurgen Ligi.
The recommendations by the OSCE for Estonia include adopting a budget rule that would ensure fiscal discipline and take into account the economic cycle, as well as going on with active labor market measures to combat long-term unemployment.
As positive aspects the OECD brings out that unemployment has fallen rapidly, employment is exceeding the pre-boom level and private investments have remained high. The budgetary situation of Estonia continues to be one of the safest in the eurozone, the OECD said.
Sources of risk for the Estonian economy lie first and foremost in the external environment and are primarily linked to the eurozone debt crisis. Also a possible increase in oil prices would place a burden on the economy, the Finance Ministry said.