Estonia's Foreign Aid
Estonia is a Baltic country located in Northern Europe, which gained its independence from the Soviet Union in 1991. Although it is a newly independent country, Estonia has a developed economy with its globally known advanced digital services industry. Being an EU member state since 2004 and an OECD member state since 2010, Estonia’s economy is growing. The country’s GDP in 2021 was $51,531 billion, with $38,700 per capita, according to The CIA World Factbook.

How is Estonia’s Foreign Aid Organized?

Estonia’s foreign aid focus on two aspects, which are development cooperation and humanitarian assistance. Between 2020 and 2030, Estonia is providing development assistance, in particular to Ukraine, Georgia and Moldova in Europe and to Botswana, Kenya, Namibia and Uganda in Africa. Estonia’s priorities in its development aid are ensuring peace, security and stability, diminishing poverty in target countries, and sharing its development experience with them in line with the United Nations’ Sustainable Development Goals (SDGs).

Estonia’s Ministry of Foreign Affairs states that Estonia’s foreign aid serves not only the development of other countries but also Estonia’s own security. To realize this purpose, two institutions are in charge of organizing Estonia’s foreign aid. On the one hand, the Department for Development Cooperation and Humanitarian Aid of the Ministry of Foreign Affairs of Estonia is the policy maker of the country’s official development assistance program. It sets strategies, and short-term and long-term action plans both for development assistance and humanitarian aid. On the other hand, Estonia Centre for International Development is responsible for implementing Estonia’s foreign aid projects both in development cooperation and in the field of humanitarian assistance, increasing Estonia’s participation in international aid projects and providing a bridge between the stakeholders and the beneficiaries. The centre is delivering its duties in a way that best serves the country’s interest.

The Amount That Estonia Spends on Foreign Aid

Although Estonia organizes its foreign aid professionally, when it comes to numbers, Estonia does not meet the international standards for official development assistance (ODA) amount. In 1970, the OECD’s Development Assistance Committee (DCA) set its ODA target for the first time that member countries should spend 0.7% of their GDP on their ODA programs. There has been no change in this target since then. Additionally, the member states who were members of the EU by 2004 agreed in 2005 to meet this target by 2015. Despite the fact that Estonia joined the EU only in 2004 and received an exemption from the aforementioned commitment, as an OECD member country, Estonia is still under the obligation of sparing an amount for its ODA equal to 0.7% of its GDP.

Estonia used to increase the ratio of its GDP spared for foreign aid. According to Estdev, in 2016, Estonia allocated 0.19% of its GDP for foreign aid, its record so far. Following that, between 2017 and 2020, Estonia spared 0.16% of its state budget for its ODA program. Lately, in 2021 Estonia increased this ratio to 0.17%, which is equal to $59 million, according to OECD.

The Future of Estonia’s Foreign Aid

It is a positive sign that the COVID-19 pandemic did not prevent Estonia from continuing its foreign aid activities at the same level. Moreover, the Estonian government pledged to increase the rate spent on foreign aid to 0.33% by 2030, according to its Ministry of Foreign Affairs. However, this target is far from the OECD ODA target.

 – Murathan Arslancan
Photo: Flickr