Analysis of the construction sector in Estonia

The construction sector plays a key role in the socio-economic development of society: companies generate wealth with construction activities that, combined with the real estate sector, account for approximately 17% of Estonia’s GDP. In order for the further development of the construction sector to be consistent and competitive in Estonia, CIVITTA Estonia has completed the analysis “A long-term view on construction” for the Ministry of Economic Affairs and Communications, which creates a vision for the future and answers the question “What could the Estonian construction sector look like in 2035?”.

In recent years, the Estonian construction sector has contributed significantly to general economic growth. However, the analysis shows that several problems and challenges exist that in interaction reduce the international competitiveness of the construction sector, such as lack of a long-term view on the living environment, a non-existent long-term and contra-cyclical construction investments plan, smart commissioning principles and implementation thereof, as well as environmental sustainability and efficiency problems, a slowdown of export growth, a lack of openness to innovation, a low level of labor productivity and the bad reputation of the construction sector.

In order to achieve the vision and resolve the problems detected, 7 large steps and 38 activities have been planned. By combining the activities of all objectives, it is possible to increase the contribution of the construction sector to Estonian GDP by 1.91 percentage points or approximately 496 million EUR in a year as added value. At the same time, the estimated total costs of the implementation of all these activities are 59.8 million EUR.

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