Estonia, EU – Baltic States, Good for Business, Markets and Companies, Technology

"Norwegian companies are mainly manufacturers, Baltic operations proved very important for them during the crisis. Some companies were virtually rescued by being able to transfer production into the Baltic countries," says Tiina Link who oversees Baltic operations for Innovations Norway, the commercial representation at the Norwegian Embassy.

“During the crisis several Norwegian companies increased production in Estonia. Changing production in Scandinavia is not s flexible, mainly because of trade unions. In Estonia and elsewhere in the Baltic countries, the wage level came down along with the financial crisis. Because of trade union resistance, a similar change in Scandinavia would have been very difficult to make if not impossible," she said.

According to Link, local business managers who are working in Norwegian-owned companies in Estonia are reliable and think similarly as their Scandinavian partners.

"For instance, in Asia where Scandinavian companies do a lot of business, the golden rule is to have own people in charge. Also, if you look at other Baltic countries, there are notably more Norwegian business managers than in Estonia. When we have meetings of Norwegian-owned companies in Lithuania, we speak Norwegian. In Latvia we speak English and in Estonia we can speak Estonian because all local business managers are Estonians," says Link.

Hans Pajoma, DnB Nord Pank CEO, noted that the bank's Estonian management is fully responsible for developing and implementation of the local strategy, and the results.

Kadrian Jaagund, Estonian area manager of Lindorff, a Norwegian debt collection agency, said that the company’s management trusts and supports local operations.

"A successful international company knows that it is necessary to adapt the group strategy to the local situation in order to be successful. The fact that it was particularly important during the crisis to know the local situation and developments, has further increased the trust towards local managers," she added.

Norwegian IT company Indico Systems that provides secure digital storage solutions set up its research and development centre in ÜlemisteCity in Tallinn in 2009.

The company's customers are mainly state agencies including justice ministries and police departments in Scandinavian and UK. Fredrik Oestereng, CEO of Indico Systems Group, noted that the company chose in favor of Estonia after considering various other countries.

"We found that Estonia was the best choice because of several reasons, including political stability, staff skilled in IT and the fact that Estonia has made a name as an IT country," Oestereng noted.

For background: There are 300 companies in Estonia that are fully or partly owned by Norwegian capital. Thousands of companies registered in Estonia have business partners and customers in Norway. The pre-crisis level of Estonian-Norwegian trade was restored in 2010 and continues to grow. Norway is Estonia’s fifth largest foreign investors behind Sweden, Finland, Holland and Russia.