Estonia once again sets the emerging Europe standard for investment promotion

Estonia again tops Emerging Europe’s ranking of the region’s 23 national investment promotion agencies, but second placed Lithuania is closing the gap. 

One of the world’s most digital societies, Estonia, has again come out on top of Emerging Europe’s annual ranking of the region’s investment promotion agencies. It is the fourth year in succession that the Baltic nation has taken top spot. 

Estonia picked up the same score as last year – outperforming its competitors in innovation, creativity and community building. Despite not being able to overhaul Estonia, Lithuania managed to reduce the gap between the two countries owing to improvements in the support and community building components. 

“We’ve come to expect good things from Estonia, so its continued dominance of this ranking is not a surprise,” says Emerging Europe’s editor, Craig Turp. “It is testimony to the hard work that the Invest Estonia team puts in that the country’s standards remain so high.  

“That said, Lithuania – which took top spot when we first published the ranking in 2018 – is taking steps to get its title back.” 

Third place this year is taken by Latvia, meaning that for the first time the top three positions in the ranking are held by the three Baltic countries.  

“Latvia’s third place recognises the efforts of the Investment and Development Agency of Latvia to create a virtual ecosystem that consists of several webpages and databases which enhance the user experience of potential investors and provide the possibility to discover opportunities offered by the country online,” says Oleksii Toporkov, a senior data analyst who led the work on the report. 

Best practice 

Since 2018, as part of its Future of Emerging Europe awards programme, Emerging Europe has been researching how the region’s 23 national investment promotion agencies communicate their investment opportunities and how they use their digital channels to get potential investors interested in the various business opportunities offered by the region’s key sectors. 

“This year, aside from ranking the performance of each country, we continue to explore the digital transformation of government and IPA operations, as well as social media diplomacy,” adds Andrew Wrobel, founder of Emerging Europe

“Our goal has remained the same for the last six years — to highlight best practice and encourage IPAs to learn from one another and improve their communications and the quality of their service.” 

Emerging Europe’s report also includes details of actual foreign direct investment (FDI), making use of the latest data – released on July 5 – from UNCTAD, the United Nations Conference on Trade and Development. 

Across the emerging Europe region, FDI inflows reached 85.5 billion US dollars in 2022, two per cent lower than in 2021, after a massive 64 per cent increase in 2021.

Here, the regional champion is by some distance Poland, which attracted almost 30 billion US dollars worth of investment last year, followed by Romania with 11.27 billion US dollars.

In terms of FDI per capita, however, Montenegro leads the region followed by Croatia, Czechia and Estonia. 

Keeping Ukraine on the radar of investors 

Despite Russia’s full-scale invasion of Ukraine in February 2022 and the subsequent, ongoing war, the country’s investment promotion agency, UkraineInvest, has worked hard to keep the country on the radar of potential foreign investors.  

Its fourth place in the ranking of IPAs – last year it was fifth – demonstrates its success. 

“[Part of] our job was to spread the message that companies leaving Russia may turn to Ukraine as a potential investment destination,” says Sergiy Tsivkach, UkraineInvest’s CEO. 

“Government incentives, reconstruction-related investment opportunities, and our ‘one-stop shop’ support were some of the components of the message bringing positive results.  

“The case of Kingspan Group, a global leader in high-performance insulation solutions, which is launching a Construction Materials Campus Project in the Lviv region, worth more than 300 million euros, is a great example of such synergy.” 

UkraineInvest has also been closely working with international finance institutions and other international partners to unlock sources of financing for Ukrainian projects. 

“We have significantly strengthened our multi-sectoral expertise and global outreach. A recently announced research collaboration with UNDP aims to mobilise international impact investment resources to boost private investment projects which can be a significant contribution to the overall recovery of Ukraine,” adds Tsivkach. 

According to UNCTAD, Ukraine attracted 848 million US dollars worth of FDI in 2022.

The 2023 edition of the Emerging Europe Investment Promotion report can be downloaded here.

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