While the Estonian Economic Research Institute (EKI) said in its economic survey on Tuesday that Estonia is on track to become one of the five most expensive EU countries, that interpretation is not correct, according to the Prime Minister's economic adviser Ardo Hansson. :format(webp)/nginx/o/2023/04/07/15243311t1h7f30.jpg)
Ardo Hansson. Photo: Madis Veltman
While the Estonian Economic Research Institute (EKI) said in its economic survey on Tuesday that Estonia is on track to become one of the five most expensive EU countries, that interpretation is not correct, according to the Prime Minister's economic adviser Ardo Hansson.
“According to the most recent Eurostat data, in the last year the price level in Estonia was 2.1 percent below the EU average. In Europe, together with Switzerland, Iceland and Norway, Estonia was in 15th place. In the EU we were in 12th place,” Hansson said.
“To reach fifth place in Europe, our price level would have to rise 37 percent faster than in Luxembourg and, for example, 21 percent faster than in the Netherlands,” Hansson said.
With Estonia's current 2.5 percent inflation rate, about the same high as the EU average, this is not expected, according to Hansson, even if security taxes are added.
In Switzerland the price level is 174.1 percent of the EU average, in Iceland 156 percent, in Denmark 143.4, in Ireland 141.8, in Luxembourg 134.5, in Norway 125, in Finland 124.5, in the Netherlands 118, in Belgium 115.5, in Sweden 113.6, in Austria 111.6, in France 110.1, in Germany 109.6, in Italy 99, and in Estonia 97.9, Hansson noted.
The director of the Estonian Institute of Economic Research, Peeter Raudsepp, said on Tuesday that overall the level of confidence among entrepreneurs remains low, but there are differences depending on the sector. For example, the service sector looks at things more positively.
The consumer basket has become more expensive in recent years, with price increases over the past year averaging 0.2 percent. At the same time, according to Raudsepp, it is already expensive to live in Estonia, since in terms of wages and prices, Estonia is already more expensive than Sweden and slightly more profitable than Finland.
“We are on track to become one of the five most expensive countries in Europe,” Raudsepp said.
“Compared to the EU average, our food price level is 109 percent, in Finland 110 percent, and in Sweden 105 percent. That is, we are practically on the same level as Finland and are among the top ten in Europe,” Raudsepp clarified. When it comes to prices for clothes and shoes, the situation is even sadder – there Estonia is among the top three in Europe.