On March 11, Aleksey Vedev, Doctor of economic sciences, Head of Financial Studies Department of the Gaidar Institute for Economic policy, shared his thoughts with about economic crisis in Estonia.
According to expert, crisis in Estonia as well as in other European countries is protracted. The main issue is the difference between the efficiency of labor productivity in the north and in the south of the European Union.
Despite stabilization of the economy since the beginning of 2009, there has been low economic growth rate, which led to a high debt burden and low labor efficiency in Estonia.

“Since Estonia is located in northern Europe, labor force is expensive in this country along with high debt burden and low labor and economic efficiency as in other North European countries, for example, Netherlands or Germany. Therefore, challenges accumulate and ultimately lead to a structural crisis”, said Vedev.
Further, the expert commented on the recent situation regarding fall in oil prices, depreciation of Ruble, capitalization of Russian companies.

Vedev concluded: “If progression of coronavirus subsides in the coming months and oil prices win back their positions, then, Russia's GDP may get off with a slowdown of the economy. However, if these challenges persist until H2, then, the crisis could overtake Russia as well”.