ESTONIA AT A GLANCE

Märt HelmjaFDI Area Manager

AT THE HEART OF THE BALTIC SEA

Area 45,339 km2

Population 1.3 million

Member of EU, Eurozone,

OECD, NATO and Schengen

Credit ratings: Fitch A+ S&P AA-

Moody’s A1

ESTONIAN INVESTMENT AGENCY

Information services & investment preparation

Investment proposals & tours

Consulting & project management

Facilitating contacts, negotiation with authorities

Identifying suitable properties & consulting recruitment

Aftercare services

WE PROVIDE

EIA IS A DIVISION WITHIN ENTERPRISE ESTONIA

Tallinn EstoniaHamburg Germany

Helsinki FinlandStockholm SwedenSilicon Valley USA

Tokyo JapanShanghai China

Saint-Petersburg RussiaLondon UK

Copenhagen Denmark

Paris FranceNetherlands

New Delhi India

HIGH POSITION IN BUSINESS ENVIROMENT RANKINGS

1st in International

Tax Competitiveness

Index

2015 Tax Foundation

2nd in Index of Economic

Freedom in EU (9 th in

the World)

Wall Street Journal / The Heritage

Foundation 2016

30th in Global

Competitiveness Report 2016

World Economic Forum

22nd in Corruption

Perceptions Index 2016

Transparency International

2nd in the Internet

Freedom

Freedom House 2015

4th in Registering

Property

2015 World Bank Group

EASE OF DOING BUSINESS RANKING 2015

16

60

2223 24

34

15LithuaniaEstoniaGermany

SwedenNew Zealand

LatviaPortugalJapan

Greece

119

Singapore

Source: World Bank – Doing Business 2015

HungaryBelgium

4243

LOW RISK –POLITICALLY AND ECONOMICALLY STABILE

A BALANCED AND FUTURE

ORIENTED STATE BUDGET

POLITICAL STABILITY

LOWEST GOVERNMENT

DEBT IN EUROPE

RISK OF POLITICAL INSTABILITY, GLOBAL RANK

6,21

5,24

6,5

Finland

Sweden

UK

Belgium

Estonia

Latvia

Spain

Croatia

Italy

Russia

7,367,49

8,24

5,04

4,854,83

4,46

Source: IMD World Competitiveness Yearbook 2015

The higher the rank, the lower the risk

11 1

1 11 1 1 1 1

RISK OF POLITICAL INSTABILITY, GLOBAL RANKThe higher the rank, the lower the risk

Finland Sweden UK Belgium Estonia Latvia Spain Croatia Italy Russia

8.247.49 7.36

6.5 6.215.24 5.04 4.83 4.83 4.46

RISK OF POLITICAL INSTABILITY, GLOBAL RANKThe higher the rank, the lower the risk

Finland Sweden UK Belgium Estonia Latvia Spain Croatia Italy Russia

16% MANUFACTURING

ESTONIAN GDP BY ECONOMIC ACTIVITY 2015

Source: Statistics Estonia (04.07.2016)

6% CONSTRUCTION

12% WHOLESALE AND RETAIL TRADE

10% REAL ESTATE ACTIVITIES

8% TRANSPORTATION AND STORAGE

4% FINANCIAL AND INSURANCE ACTIVITIES

4% AGRICULTURE, FORESTRY AND FISHING

4% HEALTH AND SOCIAL WORK

4% ADMINISTRATIVE AND SUPPORT SERVICE ACTIVITIES

5% EDUCATION6% INFORMATION AND COMMUNICATION6% PROFESSIONAL, SCIENTIFIC AND TECHNICAL ACTIVITIES

7% PUBLIC ADMINISTRATION AND DEFENCE

8% OTHER SECTORS

GDP GROWTH 2012-2017

GDP growth %

* forecastSource: Bank of Estonia (16.01.2017)

2015

1,4

2016* 2017*

5,0

1,7

2,8

1,0

2,6

201420132012

MAIN ECONOMIC INDICATORS 2013-2015

Source: Statistics Estonia (16.01.2017); Bank of Estonia (16.01.2017)

2013 2014 2015

GDP real growth (%)

GDP (current prices, billion EUR)

Change of consumer price index (%)

Labor force (thousands)

Growth of labour productivity per worker

Unemployment rate (ILO)

Average wage (EUR)

Wage real growth (%)

1.7

19.00

2.8

621.3

0.3

8.6

949

4.9

2.8

19.96

-0.1

624.8

1.9

7.4

1,005

6.3

1.2

20.46

-0.5

640.9

-1.2

6.2

1,065

6.0

2016

-

-

0,1

653,3

-

7.5

1,119 (Q3)

-

FDI INFLOW BY COUNTRY AND ACTIVITY STOCK AS OF 31.12.15

SWEDEN

Source: Bank of Estonia (14.03.2016)

FINLAND

NETHERLANDS

RUSSIAN FEDERATION

NORWAY

FINANCIAL AND INSURANCE ACTIVITIES

REAL ESTATE ACTIVITIES

WHOLESALE AND RETAIL TRADE; REPAIR OF MOTOR VEHICLES AND MOTORCYCLES

MANUFACTURING

PROFESSIONAL, SCIENTIFIC AND TECHNICAL ACTIVITIES

26%

19%

14%

13%

7%

25%

23%

10%

5%

DENMARK

0,8%

4%

TOTAL EXPORTS ACROSS ALL COMMODITIES (EUR)

8,743,007,248 €

2010

Source: Statistics Estonia (04.07.2016)

12,003,360,298 €

2011 2012 2013 2014

12,521,145,705 € 12,297,264,120 €

12,083,423,528 €

2015

11,626,723,528 €

COMMODITIES EXPORTS BY COUNTRY AND COMMODITY 2015

Source: Statistics Estonia (04.07.2016)

Sweden

Finland

Latvia

Lithuania

Russian Federation

19%

15%

11%

7%

4%

Machinery and transport equipment

Miscellaneous manufactured articles

Manufactured goods classified chiefly by material

Mineral fuels, lubricants and related materials

34%

17%

15%

9%

SERVICES EXPORTS AND IMPORTS BY COUNTRY 2015

Source: Bank of Estonia (04.07.2016)

RUSSIAN FEDERATION

8%SWEDEN

8%LATVIA

5%SWEDEN

6%

IMPORTS

FINLAND

28%FINLAND

10%

EXPORTS

SIMPLE AND FAVOURABLE TAX SYSTEM

0% Corporate income tax

on reinvested profits

Personal income tax:

flat rate 20%

Unemployment insurance:

2,6% of the

gross salary

No property

tax

VAT: 20%

Social tax:

33% Land tax:

from 0,1% to 2,5%

EASY ADMINISTRATION ALL THE TAXES CAN BE DECLARED VIA E-TAX/E-CUSTOMS

TAX RATE ON CORPORATE INCOME

0%

ESTONIA

LITHUANIA

LATVIA

FINLAND

GERMANY

Source: KPMG

2015

0% 10% 20% 30% 40%

15%

24,5%

29,6%

INFORMATION SOCIETY INDICATORS

100% OF SCHOOLS AND GOVERNMENT ORGANIZATIONS ARE ICT EQUIPPED

ENTIRE COUNTRY IS COVERED WITH A BROADBAND CONNECTION

80% OF HOMES HAVE BROADBAND CONNECTION

99,8% OF BANK TRANSFERS ARE PERFORMED ELECTRONICALLY

95% OF INCOME TAX DECLARATIONS ARE MADE VIA THE E-TAX BOARD

30% OF VOTES WERE CAST OVER THE INTERNET ON 2015

MORE THAN 94% OF THE POPULATION HAS AN ID-CARD

LABOUR MARKET

Total labour force:

650 000 – 700 000

The average wage in

Estonia in 2016 Q3 was

1 119 EUR

Unemployment rate:

7,5% in 2016 Q3

General working time:

8 hours a day, 5 days

per week

The duration of the annual

vacation: 28 days

10 Public holidays

a year

Source: Statistics Estonia (16.01.2017)

EDUCATION SYSTEM

Source: haridussilm.ee, 16.01.2017

168 gymnasiums

(high schools)

36,674students

7 universities (6 public, 1 private)

37,755 students in 16/17

17 other professional

higher education institutions

10,039 students

38vocational

schools

25 071students

KEY SECTORS

ICT TRANSPORT and

LOGISTICS SERVICES

SHAREDSERVICES

INDUSTRIAL MACHINERY

and METALWORKING

ELECTRONICS

Top-ranking destination countries by average job value of investment projects – 2015 (2014)

5,615,63

Ireland

Singapore

Switzerland

Sweden

Denmark

Netherlands

Hong Kong

Estonia

Austria

Lithuania

5,685,77

6,49

5,405,23

5,18

5,14

Source: IBM-PLI Global Location Trends database and analysis. 2016.

5,23

Source: Estonian Investment Agency, 2016

Switzerland

USA

Norway

Russia

Sweden

Germany

Finland

8

10

12

22

24

32

63

MAIN ORIGING COUNTRIES OF INVESTMENT PROJECTS HANDLED BY THE ESTONIAN INVESTMENT AGENCY

TOTAL CAPITAL COSTS 3,5 bill. €

RAIL BALTIC

Estonia

Latvia

New 1435 mm double trackrailway line

Top speed up to 240 km/h

To be finished by 2024

Lithuania

Latvian border – Kaunas

Kaunas – VilniusKaunas – Polish

border

A 1435 mm railway alongside old

1520 mm railwayTop speed

120 km/h to 80 km/hTo be finished

by 2024

THANK YOU!