Estonia Economy Grows in Q3

The economy of Estonia grew 0.9% year-on-year in the third quarter of 2025, following a downwardly revised 0.8% gain in the previous quarter. This marked the largest economic growth since the first quarter of 2022, as government spending increased (3.4% vs 2.3% in Q2). In contrast, private consumption fell (-0.6% vs 0.9%) and fixed investments also contracted (-0.7% vs 1.4%). Net external demand also supported growth, as exports (5.7% vs 1.6%) rose more than imports (5.6% vs 2.4%). On the production side, most sectors contributed positively to the economic activity, led by energy (21.5%) and real estate sector (4.4%). On a seasonally adjusted quarterly basis, GDP grew by 0.4% in the third quarter, easing from a downwardly revised 0.5% rise in the preceding period.

The economy of Estonia expanded 0.9% year-on-year in the first quarter pf 2025, recovering from a revised 0.7% contraction in the previous period. This also marked the first GDP growth since the second quarter of 2024, as private consumption rebounded, increasing by 0.9% from a 0.8% decline in the previous quarter. At the same time, government spending increased (2.4% vs 1.3%). Net external demand also weighed on GDP, as exports (2.4% vs 5.7%) rose less than imports (3.5% vs 0.5%). However, fixed investments dropped (-0.3% vs 4.3%). On the production side, most sectors contributed positively to economic activity, led by the energy sector, real estate, and information and communication. On a seasonally adjusted quarterly basis, GDP grew 0.6% in the second quarter, following a revised 0.2% rise in the preceding quarter.

Estonia's economy contracted by 0.3% year-on-year in the first quarter of 2025, reversing a 1.2% expansion in the previous period. Private consumption declined by 0.6%, following a 1.3% increase in Q4 2024, while fixed investments fell slightly (-0.1%), easing from a sharp 10.3% drop in the prior quarter. Notably, government investment surged by 20.6%. Net external demand weighed on GDP, as exports grew by 5.4% (up from 2.9% in Q4), but were outpaced by a 5.8% rise in imports (up from 4.8%). However, government spending increased by 1.7%, after a 1.1% contraction in the previous quarter. On the production side, most sectors dragged on economic activity, led by energy (-22.4%), agriculture (-17.8%), and transport (-10.3%). The trade and financial sectors also declined by 3.3% and 1.6%, respectively. On a seasonally adjusted quarterly basis, GDP shrank by 0.3% in Q1, following a downwardly revised 0.2% growth in Q4 2024, marking the first quarterly contraction in five quarters.