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National Reform Programme “Estonia 2020”

“Estonia 2020” is a reform programme that describes the objectives established to improve competitiveness and activities needed to achieve these objectives.


The two central objectives of “Estonia 2020” are increasing the productivity and employment in Estonia. The main focus in the coming years is on education and employment and the main objectives include integrating long-term and young unemployed people in the labour market and developing their skills.

The final objectives are set for 2020 and intermediate objectives for 2015.

While preparing “Estonia 2020”, the objectives and priority actions agreed between the European Union heads of government as well as European Commission recommendations to Estonia have been taken into account. The development plan serves as an important basis for targeting national investments as well as the European Union funds.

The National Reform Programme “Estonia 2020” is Estonia’s strategy for achieving the “Europe 2020” objectives.

 
 

Objectives of “Estonia 2020”


Estonia has set two main objectives for the reform programme:

  • to achieve strong growth of productivity;
  • to restore the high employment rate observed before the economic crisis.


 

In addition to the preceding objectives, the programme includes 15 further objectives that are divided into four fields:

  • educated population and cohesive society: 
    the quality and availability of education and skilled labour supply;
  • competitive business environment: 
    policy that supports the improvement of the long-term competitiveness of companies;.
  • environmentally friendly economy and energy: 
    energy and resource savings;
  • sustainable and adaptive state: 
    sustainability of public finances and the ability to react to changing circumstances; additionally, tax policy supporting the development of the economy and modernisation of the government sector.
 

First main objective: increasing productivity per employed person


The Estonia’s objective is to increase productivity per employed person to 73 % by 2015 and to 80 % by 2020 compared to the European Union average.

Increasing the productivity of Estonian companies is one of the main tasks in improving competitiveness, especially in a situation where the production costs of the companies are approaching the level of developed countries. The prerequisite for achieving the target level is that the productivity per employee in Estonia would increase approximately 2 percentage points faster than the EU average.

In 2000, Estonia’s productivity per employee was merely 47.2 % of the EU average. From this low level, Estonia’s productivity indicator per employed person has grown faster than the EU average. Due to the economic crisis, which struck in 2008, Estonia’s productivity fell in comparison with the EU average and in 2010, there was a rapid growth in productivity (including with regard to the EU average). Although the Estonian economy also grew in 2011, compared to other Member States, the productivity per employee in relation to rapid employment recovery failed to reach the EU average. 
 
In 2012, productivity raised most fast in Baltic States (Estonia 3,2%) and in 2013 the productivity per employee in Estonia was 72,8% of the EU average and in 2014 73,8%.
 
 

Second main objective: increasing the employment rate in the 20–64 age group


Estonia targets at increasing the employment rate in the 20–64 age group to 72 % by 2015 and to 76 % by 2020.

In 2015, the employment rate of the age group 20–64 grew, reaching the level of 76,2 %. Therefore, the target level of 2015 has been reached. 

Although employment has also grown faster than expected, a fresh demographic trend shows that even that is not enough to cover the labour force needs in today’s volume. 
 
 

Contact

 

Henry Kattago

Strategy Director

 

 

 Phone: +372 693 5629
henry.kattago[at]riigikantselei[dot]ee

 

Last updated: 8 May 2017