Regional policy centres around large regional differences, the concentration of the population and economic activities in cities against the background of a decrease in population, the weakening of second-tier centres and the large distances that curb the development of rural areas. In accordance with the regional development strategy, the state is working to ensure consistent growth in all areas, applying the unique potential available due to each area's peculiarities.
Regional subsidies
National support
Each year a dozen regional development support programmes and schemes are financed from the state budget. Some of them are aimed at supporting only specific regions, others cover the whole country. They all aim to guide the national regional development and improve the preconditions for the development of various regions in Estonia.
The Ministry of Regional Affairs and Agriculture mediates national subsidies from the following national programmes and measures: regional investment support programme, light and non-motorized traffic routes support scheme, local initiative programme, county development programme, Peipsiveere programme, sparsely populated areas programme, Setomaa development programme, service centre support scheme, small islands programme and the compensation scheme for the Russian Federation visa processing procedure payment.
European Union support
Estonia started receiving support from the European structural and investment funds in 2004, in relation to becoming a Member State of the European Union. Prior to this, Estonia received support from the European Union that was meant for countries who are working towards becoming the Members States of the European Union.
During the EU planning period of 2021-2027, Estonia has been allocated around €3.4 billion, plus the support from the Rural Development Fund. Energy saving, uptake of renewable energy and moving towards a greener and more resource-efficient economy are some of the major topics, and are particularly relevant in current conditions. With the support of the Structural Funds, we will be able to make stronger progress in these areas in the coming years - a third of the new period's budget has been designated to support green policies.
A key objective in the new period is also to increase the research, development and innovation capacity of Estonian businesses and the implementation of digital technologies to create a well-functioning environment for smart solutions. Developing a more science-intensive and resource-efficient economy and making the digital and green turnaround with Estonian tax money alone would take significantly more time.
A completely new funding instrument in the Cohesion Policy is the Just Transition Fund, where we concentrate support on just one region – Ida-Viru County, as the region most affected by the transition to climate neutrality. The resources of the Just Transition Fund will be divided between two areas: first, to diversify the economy and workforce in the Ida-Viru region, and, second, to support the social, environmental and community aspects of the transition.
European Territorial Cooperation (INTERREG)
European Territorial Cooperation is one of the two goals of cohesion policy and provides a framework for the implementation of joint actions and policy exchanges between national, regional and local actors from different Member States. The overarching objective of European Territorial Cooperation is to promote a harmonious economic, social and territorial development of the Union as a whole.
Almost 10 billion euros are shared between almost 100 Interreg programmes across the borders, in and outside the EU, which will contribute to implement EU’s cohesion policy main priorities:
- A more competitive and smarter Europe;
- A greener, low-carbon transitioning towards a net zero carbon economy and resilient Europe;
- A more connected Europe;
- A more social and inclusive Europe;
- A Europe closer to citizens.
In 2021-2027 Interreg has two new specific objectives:
- Interreg Specific Objective1 : A better cooperation governance;
- To enhance the institutional capacity of public administrations,
- To resolve legal and administrative obstacles in border regions,
- To promote sustainable democracy,
- To strengthen mutual trust among citizens.
- Interreg Specific Objective 2: A safer and more secure Europe
- For actions in the fields of border crossing management, mobility and migration management, including the protection and economic and social integration of third-country nationals.
- To support employment and labour market measures such as improving access to employment, encouraging life-long learning, promoting gender balance and fostering equal opportunities.
Last updated: 01.08.2023
