Economy grew in the 3rd quarter

news release no 133

According to the second estimates of Statistics Estonia, the gross domestic product (GDP) of Estonia increased 0.7% in the 3rd quarter of 2015 compared to the 3rd quarter of the previous year.

In the 3rd quarter, the seasonally and working-day adjusted GDP increased also by 0.7% compared to the 3rd quarter of 2014, but decreased by 0.4% compared to the 2nd quarter of 2015.

In the 3rd quarter, the GDP at current prices was 5.1 billion euros.

In the 3rd quarter of 2015, the GDP growth was influenced the most by a rise in the value added in trade, professional, scientific and technical activities, and real estate activities. The Estonian economy was also positively influenced by increased receipts of value added tax and decreased payments of subsidies.

According to the second estimates, in the 3rd quarter of 2015, the GDP growth was inhibited the most by a decrease in construction, also by a fall in transportation and manufacturing. The value added in construction decreased mainly due to a fall in construction volumes. In the 3rd quarter, the decline in manufacturing was broad-based – the value added decreased in more than half of manufacturing activities. At the same time, besides the value added of the manufacture of mineral products, the value added of the manufacture of wood and of products of wood was the main contributor to the growth of manufacturing. Also, the export of wood and of products of wood increased.

Both the export and import of goods and services decreased 3% at real prices. The decrease in Estonian foreign trade was influenced the most by a fall in the export and import of electronic products. Additionally, the decrease of export was influenced by a fall in the export of chemicals and beverages. In addition to the fall in the import of electronic products, the import of goods and services was greatly influenced by a decrease in the import of mineral products, wearing apparel and beverages. Net export (e.g. the difference between the export and import of goods and services) amounted to 5.0% of the GDP in the 3rd quarter of 2015.

Although the profit of the business sector increased in the 3rd quarter compared with the previous year, a similar estimate used in national accounts (operating surplus of the whole economy) was on a downtrend. The behaviour of these two indicators differs because the former does not include holding gains and other estimated components (for example, FISIM). In other words, in the business sector the profit is calculated based on output sold but in national accounts based on output produced.

Similarly to the 2nd quarter of 2015, domestic demand fell at real prices due to the change in inventories and a decrease in investments.

The gross fixed capital formation decreased for the fifth quarter in succession at real prices, but the rate of decline decelerated. The decrease was mainly influenced by a fall in the investments of enterprises in machinery and equipment. Also, there was a significant fall in the investments in buildings and structures made by the general government.

The final consumption expenditures increased 4% mainly due to an increase in household final consumption expenditure. Expenditures on recreation, miscellaneous goods and services, and clothing and footwear increased the most.

Diagram: Contribution of economic activity to GDP growth, 3rd quarter 2015

For further information:

Annika Laarmaa
Leading Statistician-Methodologist
Economic and Environmental Statistics Department
Statistics Estonia
Tel. +372 625 9353

More detailed data have been published in the Statistical Database.