Estonia

Estonia is the most northerly of the three Baltic States, with a population of 1.34 million, of which 0.4 million live in the capital Tallinn. The population is expected to fall to 1.27 million by 2030, with the proportion of people over 65 expected to increase from 25% to 36% over the same period. Estonian is the official language, Estonians accounting for two thirds of the population, followed by 25% ethnic Russians. The Euro is the official currency in Estonia. The standard VAT rate is 20%.

Estonia has a GDP per capita of €10,700, compared to the EU average of €24,400 in 2010. According to the OECD, the Estonian economy grew by 8% in 2011, and is expected to grow by 3.2% in 2012 and 4.4% in 2013 (compared to the Eurozone average of 1.6%, 0.2% and 1.4% respectively). The inflation rate was 4.1% in 2011, compared to 3% in the EU. The unemployment rate was 11.3%, compared to 9.8% in the EU as a whole in 2011.  

Estonia is a hierarchical society and decisions tend to be taken by older people, although that is changing. Preservation of Estonian culture is strong, due to the time spent under Soviet occupation. The people tend to be quiet and reserved, rather than extroverted. Initial business contact can be very formal, although this usually changes when relationships develop. Business and social situations are often overlapped.