Estonia continues demonstrating its digital commitment in the 2024 IMD World Digital Competitiveness Ranking, maintaining its position among the world’s top 25 most digitally competitive nations. The index, which evaluates 67 economies worldwide, sees Singapore claiming the top spot this year, followed by Switzerland and Denmark in the top three.
Estonia ranks 24th overall, proving the country’s sustained commitment to digital innovation and transformation. It also ranks 15th among smaller economies (with a population of less than 20 million people).
The IMD ranking evaluates countries across three main factors: knowledge, technology, and future readiness.
In particular, when it comes to knowledge, Estonia excels in training and education, ranking 11th globally in this crucial sub-factor. The country continuously ranks first in overall PISA scores in Europe, while ranking 9th in total public expenditure on education and in the top dozen for pupil-teacher ratio at the tertiary level.
Estonia is also actively improving its weaker points. For instance, regarding public-private partnerships, the government recently announced a €160M incentive for large-scale investments, with a focus on export-oriented projects that create high-paying jobs.
In a scenario where solving the tech gap between the US and EU has become a major priority, Tallinn is speeding up the adoption of new technologies and investment practices. According to Atomico’s latest State of European Tech report, Estonia is now a global leader in venture capital investment relative to GDP.
The report, which provides a comprehensive analysis of Europe’s tech ecosystem, reveals that the continent has undergone a remarkable transformation over the past decade, growing fivefold to reach a valuation of €3.2 trillion in 2024.
Estonia has established itself as the world leader in venture funding relative to GDP, with VC funding accounting for an impressive 1.17% of GDP over the past decade – the highest ratio globally, surpassing Singapore, Israel, and the US. The country now has nearly 11,000 tech employees per million inhabitants, second only to Finland in Europe.
The report also points out that Estonia’s ecosystem has produced several global success stories, including Bolt, now valued at €8.4 billion and counted among Europe’s most valuable tech companies. Estonia snags the top spot for the highest number of unicorns per capita.
The report highlights several key strengths of Estonia’s productive tech ecosystem:
- Zero corporate tax on reinvested profits;
- Digitized processes for company incorporation;
- Strong government support for innovation.
- Estonia has successfully created a self-reinforcing talent cycle, with experienced professionals from successful companies going on to find new startups or invest in the next generation of entrepreneurs.
- Strong ability to scale internationally, with Bolt preparing for a potential IPO in 2025.