Estonian entrepreneurs feel that an unstable tax environment, excessive regulation, and bureaucratic inefficiencies hinder their international competitiveness. At a meeting hosted by Enterprise Estonia (EIS) with exporting companies, participants discussed what Estonia should do differently to take the next step in export development.
The Enterprise Estonia’s autumn meeting, attended by a couple of dozen Estonian exporters, sparked an open discussion on the challenges and opportunities facing companies. Roman Vinartšuk, Adviser to the Management Board at BLRT Group; Marko Kaseleht, Senior Vice President for Defence at Nortal; Katre Kõvask, CEO of YOOK Production; and Eva-Kristiina Ponomarjov, Director General of Trade Estonia at Enterprise Estonia, spoke about their experiences.
“Defence isn’t free – taxes are necessary to maintain it.”
Marko Kaseleht, Senior Vice President for Defence at Nortal
According to the entrepreneurs, Estonia’s export policy needs a more precise focus, a longer-term plan, and greater flexibility in a rapidly changing world. The state has set precisely such goals for itself.
Taxes, tariffs, and instability
Exporters say today’s economy is marked by uncertainty, forcing companies to react quickly. Katre Kõvask noted that taxes and tariffs are often decisive in whether a company can survive in a given market.
“As an EU member, we sometimes face situations where competitors have an advantage. If someone packages their goods in Vietnam, they don’t pay the tariffs we do. If the tariff is 30%, we’re out of the game. Right now, it’s 5% – and we can operate. But we’ve learned that we have to stay extremely flexible,” said Kõvask.
She added that instability in the domestic tax system is also a major concern: “One thing is the tax rate, another is instability. If you don’t know what tax will appear next year, it’s very difficult to invest. Add a few per cent at every step, and in the end you get ten. That erodes our competitiveness.”
Roman Vinartšuk noted that the current times are highly turbulent for industrial companies: “Adaptation is vital. As one of Estonia’s largest factories, we see how fast things change – and how expensive every unexpected tax or delay becomes.”
According to Marko Kaseleht, taxes and defence spending are part of a bigger picture: “Defence isn’t free – taxes are necessary to maintain it. The problem is that we lack strategic communication. We don’t understand why we pay and what for.”
He added that every company is part of national defence: “If we don’t contribute ourselves, no one will do it for us.”
Export policy needs a longer-term vision
Although Estonia has defined priority markets for state support, many companies operate beyond those borders. YOOK has found success in Turkey, Nortal has signed a contract with South Korea’s defence industry, and BLRT Grupp is exploring opportunities in Brazil through its Lithuanian subsidiary.
According to Vinartšuk, the issue is not the number of markets but the absence of a long-term plan: “We need a longer-term plan that can be adjusted as needed. A plan that doesn’t adapt is just paper, not a tool. The challenge isn’t how many markets we’re in, but whether we have a strategy for staying there long-term. Short-term success is not a strategy.”
“Today, Estonia tends to be the ‘best student’ in Europe.”
Katre Kõvask, CEO of YOOK Production
Katre Kõvask added that Estonia’s officially selected target markets shouldn’t exclude unexpected yet promising ones. For YOOK, one of the biggest success stories has been Turkey: “Turkey came out of nowhere. It has 80 million people, is a NATO member, and a nation of coffee drinkers – a perfect fit for us.”
Kõvask emphasised that the survival of Estonia’s food industry depends entirely on exports: “If we want the food sector to survive, exports must work. Right now, our target markets have been well chosen and are performing well. By the end of the year, we may have 13-15 new markets.”
However, she pointed out that Estonia lacks a consistent support mechanism and export policy: “Poland has subsidised its food exports for over 30 years. That’s why their prices are low and companies strong. We don’t have that kind of policy. We need a 5–10-year strategy – and we need to follow it.”
Eva-Kristiina Ponomarjov, former Director General of Trade Estonia, said that national priorities should be based on real potential, not tradition. “We’re focusing on where the actual opportunities are – not just what has been our comfort zone.”
She added that the newly completed Estonian Export Strategy 2025–2028 focuses on sectors with the greatest potential: wood industry, maritime sector, food and beverage industry, machinery and metalworking, defence industry, ICT, green technologies, and health technologies. “These are the sectors where Estonia already has a strong foundation – and where global demand is growing,” said Ponomarjov.
Overregulation and bureaucracy slow down progress
The discussion became particularly lively when it came to EU regulations and domestic bureaucracy. “In the food industry, we spend thousands of euros on packaging and labels that no one reads,” said Kõvask. “Butter used to be butter – now we have to add that it contains milk. It doesn’t benefit the consumer, but it means additional costs for production,” said Kõvask.
According to her, we don’t always have to be the most obedient followers of the rules. “But today, Estonia tends to be the ‘best student’ in Europe,” Kõvask noted.
Vinartšuk agreed, saying that while regulations may be necessary, excessive compliance can backfire: “A sensible balance must be maintained. If we’re constantly filling out reports and proving things, we have less time to find new markets.”
The need to reduce bureaucracy was a recurring theme throughout the discussion. Reporting and grant systems should be simpler and more transparent for entrepreneurs. EIS has made reducing administrative burden one of its clear objectives.
“With only 1.3 million people, Estonia can’t grow without new labour and foreign investment. We need partners and skilled workers from abroad to stay competitive.”
Roman Vinartšuk, Adviser to the Management Board at BLRT Group
Entrepreneurs also expressed concern about workforce shortages, limited investment, and lack of resources. “With only 1.3 million people, Estonia can’t grow without new labour and foreign investment,” said Vinartšuk. “We need partners and skilled workers from abroad to stay competitive.”
Kaseleht added that partnerships are equally essential in technology and defence industries: “If we want to enter new markets, national funding alone isn’t enough. Strong partnerships are the only way to grow.”
A call for stability and cooperation
Estonian entrepreneurs have a clear message: the state must provide a more stable and predictable business environment. Successful export, they said, doesn’t come from isolated projects but from long-term, consistent cooperation and a functioning ecosystem that enables companies to grow internationally.
To support this, Enterprise Estonia (EIS) helps companies expand to foreign markets, build valuable contacts, and establish partnerships that lead to real business projects. EIS currently has export advisers in 14 countries, and supporting export will remain a key focus in its new strategic period – helping Estonian companies reach further and compete globally.
Are you interested in trading with Estonia? Enterprise Estonia is providing sourcing services for foreign enterprises. Contact Estonian export advisors or use our free e-consulting service to start trade with Estonia.
