Jobless Estonians Will Lead EU Economy in Five Years – Economic Growth Forecast
Despite being one with the highest unemployment rates in the European Union, Estonia will likely be the leader in euro zone economy over the next five years according to Ernst & Young’s economic growth forecast to be released today.
Elsewhere in Asia, PricewaterhouseCoopers released parallel predictions for China and India in January, saying India’s economy will increase from 2 percent to 13 percent at the market exchange rate by 2050, next only to China.
These countries make up the emerging markets that have become new targets of investors worldwide at present following the global financial meltdown.
The economic growth prediction for the eurozone will be published in collaboration with Oxford Economics and will include a whole section for Estonian development for the first time in its series.
Ernst & Young audit partner at Baltic Ivar Kiigemägi made optimistic projections for the economy of Estonia, saying it will gain speed in the next five years despite gloomy economic status of the eurozone.
Estonia’s employment rate is expected to reach the average pace in EU from its current position as one of the European countries with high unemployment rates today.
According to Kiigemägi, Estonian economy will be driven mainly by the country’s increase in exports. In February, Estonian exports improved and demand for domestic products increased.
The improvement resulted in industrial productions to increase 31.4 percent from the previous year.
In the last quarter of 2010, Estonian economy valued at $19 billion expanded by 6.7 percent due to increase in demand for goods and services in Finland and Sweden. The rise was the highest in 3 years and a half.
Kiigemägi added that subcontracts from Scandinavian companies and industrial improvements would aid in pulling out Estonian economy from the crisis and improve employment rate.
He warned, however, that Estonian economy is still dependent on Finland and Scandinavia, so their economic pace will necessarily affect that of Estonia.
But Ernst & Young’s economic growth forecast is supported by the fact that economies of Finland and Scandinavia are gaining momentum as well.