The economy will grow by 9.5 percent this year

The economy will grow by 9.5 percent this year, the finance ministry says, and by 4 percent in 2022. The ministry says inflation will be 3.8 percent this year, slightly lower in 2022 and substantially lower (around 2 percent) in 2023-2025.

Speaking at a press conference Thursday announcing the ministry’s summer economic forecast, finance minister Keit Pentus-Rosimannus (Reform) said: “Our economy has recovered at a rapid pace, and we are largely back to pre-crisis levels,” though noting the coronavirus crisis has benefited some sectors and harmed others.

The government prepares its draft state budget partly on the basis of the summer forecast.

The ministry forecasts real economic growth of 2.6 percent in 2023, 2.9 percent in 2024 and 2.8 percent in 2025.

Inflation will run at 3.8 percent this year, then slow slightly to 3.7 percent in 2022, and more sharply to 2.1 percent in 2023, and 1.9 percent in 2024 and 2025, the ministry says.

Unemployment is expected to fall just 0.1 percentage point to 6.7 percent this year, but more substantially for 2022 (to 5.8 percent). After that the curve will flatten at 5.7 percent unemployment in 2023, and 5.6 percent both for 2024 and 2025, according to the ministry.


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