Estonian GDP expanded 0.6% on the year in the second quarter, marking a slowdown from the decent tempo seen in January-March, Statistics Estonia announced on June 9.
Seasonally and working-day adjusted, economic growth sank to 0.5% y/y, while managed a gain of just 0.3% in quarterly terms. In the first quarter, the economy expanded 1.7% y/y.
What growth there was in the second quarter was driven by external demand, Statistics Estonia noted. “The real increase of the export of goods of the total economy was 5% y/y. Foreign trade was mainly influenced by the increase in the export and import of electronic products. Additionally, the export of goods was significantly affected by the increase in the export of electrical equipment and wood products.”
On the other hand, closer to home growth in April-June was negatively influenced by excise taxes, the stats office points out. In particular, Statistics Estonia notes a drop in alcohol sales.
Swedbank expects the Estonian economy to grow 2% this year, with improving investment and exports the primary drivers. The rapid growth of private consumption is likely to slow a little the analysts forecast.
Pushing to 2% would mark a strong improvement on the feeble performance last year. Estonian GDP grew just 1.1% in 2015, the slowest rate of expansion since the Baltic meltdown in 2009.