By Luize Ferreira and Çag Çetin (Fraunhofer IPK)
“Most of Estonia’s research partnerships take place in Europe. Extending these partnerships to the LAC region could help Estonia achieve its objectives of internationalisation and support LAC countries in developing research, particularly in the healthcare sector.”.
Estonia is located on the border between central Europe, Russia and the Nordic countries. The capital Tallinn accommodates one third of the 1.3 million population. Estonian society is highly digitalised and has developed a digital infrastructure with wide internet access, national identification cards, and online government services (ITA, 2020). With regards to healthcare, Estonia ranked 7 out of 27 countries in the Digital Economy and Society Index (DESI) 2021and the 2019 Annual European eHealth Survey also revealed that Estonia is the leading country for e-health innovation in Europe.
Estonia is also relatively energy independent thanks to its national reserves of natural gas, but it produces the second highest greenhouse gas emissions per capita in the EU. Hence, the Estonian government is planning to diversify electricity supply via investment in renewables (biomass, biogas, wind power) and cleaner oil technology, which will create commercial opportunity. Another attractive advantage of the country is the ease of doing business – ranked 16 out of 190 countries in the World Bank index (ITA, 2020).
In 2014, Estonia was the first country in the world that launched its e-Residency program. The program provides holders of e-Residency with a transnational digital identity which allows them to access the EU business environment and use Estonian public e-services. People from across the globe can apply to become e-residents so that they can start and run a trustworthy, location-independent EU company with all the tools needed to conduct business worldwide, entirely online. (e-Estonia, 2022)
In addition, nearly 99 percent of banking transactions in Estonia are conducted electronically. According to the International Trade Administration (2020), the leading fields within the IT sector are: identification and secure data communication, software and hardware, data storage, cloud computing, and upgrading of government e-services and interoperability of databases (ITA, 2020).
Estonia performs well and scores above the European Union (EU) average in most OECD indicators. The country presented the new Estonian Digital Agenda 2030 with three priorities: (i) developing further digital public services; (ii) focusing on cybersecurity and (iii) improving connectivity across the country. Finally, the 2021 Structural Reform Priorities are to maintain inclusiveness, particularly for the low skilled workers; boost digital infrastructure to promote business connectivity and dynamism; improve energy efficiency to reduce high CO2 emissions; reduce taxation from labour and promote competitive business market (OECD Estonia).
Economic Forecast
Steady economic ties with Nordic countries, notably Sweden, have helped Estonia recover quickly from the pandemic, maintaining public dept relatively low compared to other countries in the euro zone and experiencing 8.3 percent GDP growth in 2021. According to the OECD, economic growth will be moderate in 2022 (4,5%) and 2023 (3,8%), after an exceptionally strong growth in 2021 (9,6%)(OECD Estonia). Companies report labour shortages which will pressure higher wages and inflation. In addition, Russia’s invasion of Ukraine implies higher energy prices and macroeconomic risks for Estonia have increased in 2022 (The Economist – Estonia, 2022).
Estonia’s Recovery and Resilience plan approved by the Government in 2021 includes a grant from the European Commission worth EUR969.3 million as part of the NextGenerationEU programme. The financing will support crucial investment and reform measures put forward by Estonia to emerge from the COVID-19 pandemic by 2026. In particular, they will contribute to the green and digital transitions, the economic resilience and accessibility of the health care system, social inclusion, and anti-money laundering (European Commission, 2021).
In the long-term, the Government Office and the Ministry of Finance developed the “Estonia 2035” strategy with the aim of guiding political decisions and allocation of EU funds in different fields in the coming years (Estonian Government, Eesti 2035).
Estonia’s Science Technology and Innovation (STI) Landscape
Estonia’s expenditure on R&D has been increasing since 2016 and represents 1,79% of its GDP today. In 2020, a total of EUR 482 million was invested in public and private research and development in Estonia (Estonian Research Council, 2020). The public sector is responsible for financing most of the R&D performed in the country together with large enterprises and foreign funds such as Horizon Europe. The Estonian Ministry of Education and Research is the highest governmental agency responsible for the planning, coordination, execution and monitoring of the country’s research and education policy. The Estonian Research Council organizes the national funding structure while the Estonian Academy of Sciences (EAS) works as an umbrella organisation connecting top-level Estonian scientists, supporting Estonian membership in international research associations and operating research exchange programmes (EURAXESS Estonia, 2020).
There are twenty R&D institutions, six of which are public universities. The largest research universities are the University of Tartu, followed by the Tallinn University of Technology, the Estonian University of Life Sciences and Tallinn University. Other large institutions that perform high-quality research in the fields of interest for ENRICH in LAC are:
- Estonian Bio Competence Centre
- Competence Centre on Health Technologies
- National Institute for Health Development
- Protobios company
- STACC company
- National Institute of Chemical Physics and Biophysics
The work of R&D institutions is supported by several foundations and research parks that aim to create a favourable environment for research in Estonia (EURAXESS Estonia, 2020). The internationalisation of Estonian research has been a top priority in recent years. Estonia wants to be more active and visible when it comes to international RDI cooperation (Estonian Research International Marketing Strategy). Most of Estonia’s research partnerships take place in Europe. Extending these partnerships to the LAC region could help Estonia achieve its objectives of internationalisation and support LAC countries in developing research, particularly in the healthcare sector.
National Science Technology and Innovation priorities
According to a survey regarding the OECD database of governance of public research policy, there are three pillars for national STI priorities for Estonia. First, materials for science and industry, for example, innovative construction (“smart house”), health-supporting food and chemical industry particularly promoting more effective use of natural gas. Secondly, information and communication technology (ICT) across sectors including the use of automation and robotics in industry, cybersecurity and software development. Thirdly, health technologies and services, especially biotechnology and the use of IT for the development of medical services and products (e-health) (OECD, 2018).
Previous contribution in Horizon 2020
In total 896 Estonian organisations were involved in Horizon 2020 projects with a total of 273M Euro funding received by the project’s participants. Structured by thematic priority, projects were conducted mainly within the frame of (Horizon 2020 Dashboards, state of November 2022):
The three major organisations in terms of received funding were the Tartu Ulikool (69,5M Euro), Tallinna Tehnikaulkool (37,75M Euro) and Fibenol Ou (17,69M Euro). The main collaboration links with LAC Countries of the Collaborative Country Group ‘Other Countries which get Automatic Funding’ are Argentina with 29 collaborations and Chile with 12 collaborations (Horizon 2020 Dashboards, state of November 2022).
Funding opportunities in Horizon Europe
Horizon Europe is the biggest EU research and innovation programme ever with €95.5 billion of funding available over 7 years (2021 to 2027). It is open to the world. This means that participants from all over the world can participate in most calls. In many cases, the EU will fund at least partly the participation of the international partners. As a member state of the EU, participants from Estonia are automatically eligible for EU funding, unless specific limitations or conditions are laid down in the work programme and/or call/topic text. Most LAC countries are also eligible for EU funding as per the Horizon Europe participation rules. The list of eligible countries can be consulted in the Funding and Tenders Portal.