Europe is moving towards a sustainable future. Despite its compact size, Estonia is determined to be a trailblazer in these efforts.
The main action is happening in the country’s industrial heart, the eastern region of Ida-Virumaa. To phase out the reliance on oil shale mining, the Just Transition Fund (JTF) was created in 2019 as part of the European Green Deal, the EU’s plan to make Europe the first climate-neutral continent by 2050. Estonia was allocated a significant portion of the JTF, totalling €354M, the highest per capita allocation in the union. Since then, the country has moved swiftly to put the money to good use. This week, it was announced that over half of the Just Transition Fund has been allocated.
Over €170M has been awarded to various projects, with 626 high-quality jobs expected to be created. There is more good news—the fund was aiming to stimulate private investment in the region, with an initial target of attracting at least €168 million. To date, the private sector has committed €197 million in investments in the region, showing Estonia’s investment attractiveness.
A detailed list of the nearly 40 projects that have received funding exceeding €250,000 can be found on the Just Transition Fund website, idavirufond.ee. This includes a magnet factory in Narva being built by Canadian Neo Performance Materials (NPM). The factory is expected to significantly boost the local economy, initially employing over 300 people, with potential for expansion to over 1,000 high-paying positions. JTF has provided over €18,7M to support the initiative.
Heavy machinery company Agricom Tehnika is investing almost €2 million to establish a waste timber and farmland biomass collection and recycling centre in Ida-Virumaa. Aquaphor is investing €11 million to start producing water purification devices that also work within the framework of smart homes. The state is supporting the projects with €900,000 and €3.2M from the Just Transition Fund, respectively.
In addition to industry, the JTF is improving everyday life in the region, committing huge sums to renew communal infrastructure: building new kindergartens and modernising community centres. “The fund is not just for industries or entrepreneurs—it also supports initiatives in education, the living environment, and other areas that contribute to the region’s well-being,” says Ivan Sergejev, just transition process coordinator at the Estonian Ministry of Finance.
Jaanus Purga, the government’s representative in Ida-Virumaa, is pleased with the number of applicants and the volume of projects receiving funding. “This positive growth trend is largely due to two factors: the easing of conditions for business measures at the beginning of the year and extensive work with investors and local people. I am particularly pleased with the involvement of Estonian investors,” Purga added.
Half down, half to go — it’s not too late to benefit from JTF and Ida-Virumaa opportunities. Read more and reach out to our representatives to start your business journey in Estonia.
