The Estonian economy is showing green shoots of recovery again, and people’s real purchasing power has risen since June of last year. These are the words of the Minister of Economic Affairs and IT Erkki Keldo (Reform).
He also added that wages have also been outpacing inflation.
Speaking to “Esimene stuudio,” Keldo noted that people’s real purchasing power has been increasing since June of last year and then he went on to assert that wages have been growing faster than inflation. Keldo also said that the average pension is increasing at a faster rate than the average salary, which raises concerns about the sustainability of such growth.
If pensions continue to outpace salaries without corresponding economic productivity, future imbalances could emerge, undermining long-term economic stability.
The minister traced the roots of Estonia’s current economic challenges back to 2022 and the Russian invasion of Ukraine, which disrupted supply chains.
While this was a significant issue, he said, the economic strain also derived from soaring energy costs and wider geopolitical instability. As for the role of the Reform-SDE-Eesti 200 coalition, Keldo stressed that “the government’s task is to provide stability.”
Keldo also called for a reduction of bureaucratic red tape. “Businesses are asked to provide the same information multiple times,” he said. The government’s goal to consolidate over 400 reports into a single form is commendable, he went on but businesses’ willingness to embrace digitalization and e-invoicing is key to its success, the minister added.
“We have long talked about having excellent e-services,” Keldo added, stressing collaboration between the government and the private sector.
Keldo said his ambition for Estonia’s economic future was clear: “If we grow added value, wealth will follow.”
As Estonia looks to a more diverse future in terms of energy, including nuclear power, a balanced approach will be crucial in aligning energy goals with sustainability commitments, he noted.
“We need excellent connections with our neighbors,” Keldo added, highlighting the importance of regional cooperation.
The article was originally published here: https://news.err.ee/1609541923/minister-despite-the-challenges-incomes-in-estonia-are-rising