Estonia can be divided into five investment regions, all offering unique business opportunities for investors. Each region has highly developed infrastructure, possibilities for cooperation with vocational schools and universities – and its own core advantages in areas as diverse as boat-building, food or timber industries and ICT.
North Estonia: the perfect ground for creating a small enterprise… or an energy revolution
North Estonia, surrounding Estonia’s capital Tallinn, is an advantageous business environment for industrial, global business services and supply chain sectors. In the recent years, it has set its focus on manufacturing, energy and electronics. There are several ongoing green energy related initiatives, among others creating the so-called Hydrogen Valley of Estonia.
The region offers advanced and rapidly-developing production infrastructure: roads, telecommunications, warehouse facilities; and a compatible transportation network with easy access to, among other ports, the biggest cargo port in Estonia, Muuga Harbour.
Many companies also operate in the manufacture of timber products, furniture, metals, plastics and building materials. The abundance and variety of small enterprises is another one of the main strengths of North Estonia, especially in the areas further from Tallinn.
North Estonia’s population and economy keep growing and the economic growth in the region is also a major contributor to increasing Estonia’s overall international competitiveness.
South Estonia: the country’s heart of research punching above its weight in ICT and startups
South Estonia’s economic development runs around the city of Tartu, where ICT and startup ecosystem, science and the city’s companies’ cooperation with academia give an important meaning for the whole region. The city of Tartu even has its own startup unicorn, Playtech. Tartu and its surrounding counties have highly developed infrastructure, and an excellent transportation system connecting highways, railway, and a regional airport.
Other parts of South have their advantages in food production, industries related to timber and timber products (including furniture and paper), mechanical engineering, and logistics. Tourism also plays a major role in the region’s economy. As South Estonia borders two of Estonia’s neighboring countries, Latvia and Russia, this offers further advantages in logistics.
West Estonia: from sandy beaches and nearly 1,000 islands to great boats and booming bioeconomy
Recreation services and tourism economy have long traditions and the West Estonia’s image as a rehabilitation area – with some of Estonia’s most beautiful beaches – dates back to the middle of the 19th century. New blue economy – sustainable use of the marine environment – perspectives are small craft construction, aquaculture and offshore energy; all enabled by the region’s unique geographical location.
West Estonia has a remarkable bioeconomy potential and many business opportunities for internationalisation and technology development. The region is economically balanced with a comprehensive range of industries. The key industrial sectors in the region are electronics, timber, food, metal, plastic, peat and textiles.
East Estonia: where large things are made to happen
The region is characterized by low manufacturing setup costs and the presence of supporting industries, highly-developed infrastructure, and a smooth transportation system with inland transport, rail connections, and ports. It is an excellent logistical location for EU-Russia trade and has substantial opportunities for further efficient investments.
The eastern part of the region contains large deposits of oil shale – the main mineral mined in Estonia that is used in the production of shale oil and in thermal power plants, making the region a center for chemical and energy industries. As the mining and energy industry in the region is in transition, this will offer further opportunities already in the nearest future, making East Estonia another place to keep your eyes open for when planning to change the energy game.
Tallinn: the capital of startups, IT and productivity
Tallinn is the most important financial and business center in Estonia. Over half of Estonia’s businesses have converged around the capital, and over half of Estonia’s GDP is generated in Tallinn. The city is known as a technology-based business environment and a suitable location for the development centers of international enterprises and startups.
In fostering entrepreneurship, Tallinn focuses on the main areas of smart specialisation, i.e. areas that influence other economic sectors through their developments, that contribute significantly to the development of the city, and whose productivity and target markets grow rapidly. These areas include cyber security, robotics, smart fabrics, personalised medicine, genetics studies, and e-health.
The startup community in Tallinn has been growing rapidly for more than 15 years. It is no coincidence that Tallinn has one of the highest rates of startups per capita among European cities. Estonian people are entrepreneurial and innovative, while the government supports small businesses and the development of technology. Tallinn truly is Europe’s start-up paradise.
The rapid growth in enterprises in the field of the green economy in Tallinn is very promising. This results in green economy business developments and innovations, including a circular economy, circular materials use, and the growth of the green community.