Analytics, Baltic Export, Economics, Estonia, GDP

According to the estimation of the Ministry of Finance, the residents’ financial confidence improved in the fourth quarter of 2009, but they continued consuming less than their income would have allowed. Due to price decrease, real private consumption fell by 17% in the year-on-year comparison – a little less than projected.

In comparison to previous quarters, people continue cutting back on their consumption of foodstuffs and alcohol. The use of personal cars is increasingly replaced by the use of public transport.

The ministry noted in its comment that at the end of last year, decline in exports in the year-on-year comparison started slowing down, due to slightly increased volumes in some sectors and due to the impact of the low comparative base. Companies have cut back on their expenses significantly in the context of decreased demand and have thus improved their competitiveness on foreign markets.

The growth outlooks on Estonia’s main exports markets are also improving and therefore the exports sector has slowly started to receive new orders and a slight increase is expected to take place in the beginning of this year already. The growth in exports in the year-on-year comparison will be the factor that will push economic growth in the second half of the year.

The Ministry of Finance will publish its spring economic outlook for Estonia in the beginning of April.