Interested in investing in Estonia? Use our 1:1 e-Consulting service to get started.
Investment decisions are no walk in the park in 2025. Yet a new report says that despite regional headwinds, foreign investors continue to bet on Estonia, drawn by its world-class digital infrastructure and business-friendly pragmatism. The report was compiled by the Foreign Investors’ Council in Latvia (FICIL), in cooperation with the Stockholm School of Economics in Riga (SSE Riga) and RTU Riga Business School (RBS).
According to the FICIL Sentiment Index 2024, which surveyed over 100 leading foreign companies across Estonia, Latvia, and Lithuania, Estonia’s digital infrastructure was rated the country’s greatest strength, with 69% of respondents citing it as a key advantage—the highest among all three Baltic States. Business regulations (50%) and Estonia’s reputation for technological know-how (44%) were also frequently noted as competitive strengths.
While the average investment attractiveness rating for Estonia stood at 2.7 out of 5, foreign investors pointed to Estonia’s long-standing focus on digital transformation and business-friendly environment as underlying factors for optimism. Estonia also stands out for its pragmatic, compromise-oriented business culture. “Estonian colleagues are often more willing to compromise and find common solutions, which makes collaboration smoother,” noted one investor.
Key investment drivers
The 2024 report highlights several other features where Estonia excels:
- Business Regulation (50%) — a streamlined, transparent legal and tax framework (#1 in OECD for a decade and counting!) supports entrepreneurship and minimises red tape.
- Technology & Know-How (44%) — Estonia is home to a vibrant tech ecosystem, with deep pools of IT talent and a supportive startup culture.
- Quality of Life (25%) — A safe environment, clean nature, and efficient public services contribute to a high living standard that supports talent attraction and retention.
“Quality of life in the Baltics is good—beautiful nature, good infrastructure, everything is nearby… Estonia and the Baltics, generally, are a good place to live,” sums up one investor from the manufacturing sector, who was quoted in the survey.
Of course, like its Baltic neighbours, Estonia faces challenges, primarily related to labour shortages and rising production costs. At the same time, one important issue is clearly being addressed.
Estonia was the only Baltic country where defence did not rank among the top five investor concerns, showing confidence in the country’s strategic stability. The government has recently doubled its strategic €100M Defence Industry Fund and unveiled a new 200-hectare industrial park in Pärnu County, among many other measures. Estonia will also be the first country to cross 5% of its GDP in defence spending.