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The former Soviet satellite, with a population of 1.3 million, went through a radical transformation after the collapse of its Communist government in the early 1990s, and has emerged as one of the most economically successful EU members to join after the fall of the Soviet Union by building a truly digital government and society.
Nearly all government services are provided online, and a national system of electronic identity cards allows citizens to sign contracts, file their taxes, and even vote in national elections online. The economic result? Estonia’s GDP per capita has quintupled since 1991, growing faster than its Baltic neighbours Latvia and Lithuania as well as outpacing Russia and nearby Finland.
It’s an unlikely result for a post-Communist country less than half the size of Newfoundland, where the densely forested landscape is dotted with castles, churches and hilltop fortresses. But now, nearly all of those forests, castles, churches and hilltop fortresses are blanketed with fast, free Wi-Fi.
“Going digital has allowed small Estonia to punch well above our weight on a global scale,” says Siim Sikkut, Estonia’s Government Chief Information Officer.
Sikkut is the person charged with keeping the country on the cutting edge. He took the job last year and is working on bold new projections including introducing self-driving vehicles to the country’s public transportation systems.
Siim Sikkut is Estonia’s Government Chief Information Officer, the man charged with keeping the country on the cutting edge. He took the job last year and is working on bold new projections including introducing self-driving vehicles to the country’s public transportation systems.
He was also behind the country’s e-residency program, which allows foreign citizens to become Estonian residents without ever entering the country. Aimed at entrepreneurs, the program is meant to offer them an easy way to get access to the EU market and euro-denominated transactions, while also helping boost the country’s economic prospects.
It hasn’t always been an easy path for Estonia. The switch from the Soviet planned economy was hard, but the newly independent country made an early bet that technology and the Internet could drive exponential growth in the economy. By 1997, 97% of Estonian schools had Internet access.
“As a small country, we had to find ways to be really efficient to pull off the challenge of being a fully fledged developed country,” Sikkut says.
All that technology required new ways of learning, and the government also focused on building a world-class education system. Estonia is now ranked behind only Singapore and Japan in the OECD’s international comparison of school performance by 15-year-olds.
While Estonia has embraced technology to revolutionize delivery of public services, it’s also familiar with the dark side of data. The detailed files kept in the KGB office in Tallinn helped the government maintain an iron grip during the Communist era. Transparency about the use of data and government activities is part of the justification for the domestically developed blockchain that the country uses for data verification and independent oversight of its processes.
Work began on that blockchain tech in 2008, before the original Bitcoin proposal was even published, and that isn’t the first time Estonia has been an innovator. Estonians were behind the original development of Skype and the file-sharing service Kazaa, and as far back as in 1970, the government used computerized data analysis to run a dating service for Estonian singles.
The country has adopted many of the social-democratic policies promoted by its Scandinavian neighbours across the Baltic Sea. Early childhood education, school lunches, and universities are free. But what sets Estonia apart is its embrace of the digital future, and building a digital present for its citizens.
Tune into our next RBCDisruptors event on Facebook Live, Democracy.exe: Estonia’s Digital Society, on Thursday, May 24 at 11:30 a.m. ET for a fireside chat with RBC’s John Stackhouse and Estonia’s GCIO, Siim Sikkut, live from the C2 Montreal conference. Click here to register, and make sure to like C2 on Facebook to get a notification when the event begins.
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