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1 Zaporizhzhia National University, Ukraine (corresponding author)
E-mail: liliia_khorishko@ukr.net
ORCID: https://orcid.org/0000-0002-0618-976X
2 "Zaporizhzhia Polytechnic" National University, Ukraine
ORCID: https://orcid.org/0000-0002-8981-4769

DOI: https://doi.org/10.30525/2256-0742/2022-8-3-205-209

MECHANISMS FOR ENSURING ESTONIA'S PERMANENT 
DEVELOPMENT: THE ENVIRONMENTAL ASPECT

Liliia Khorishko1, Tetyana Vasyl'chuk2

Abstract. The latest trends in global development actualize the problem of ecological modernization in order 
to ensure the sustainability of socio-economic and political functioning of modern states, creating additional 
opportunities for an appropriate response to possible threats. The issues of ecological modernization are key 
on the agenda of the EU, which seeks to demonstrate leadership in addressing it. Ecological modernization and 
the subsequent digitalization of the economic sphere are considered one of the most important components 
of sustainable development of the EU and each member state. These processes and mechanisms for their 
practical implementation are approved in the program The European Green Deal. The European Commission 
created the Recovery and Resilience Facility, which provides for the coordination of efforts of EU member states 
to ensure resilience and sustainability of development. The subject of the study is the content and characteristics 
of sustainable development in Estonia. The purpose of the scientific exploration is to identify environmental 
aspects and to specify mechanisms for sustainable development in Estonia. Research methodology: systematic 
approach, methods of analysis and generalization. Estonia has developed a long-term strategy "Estonia 2035", 
which defines the basic principles of sustainability and sustainable development of the state. The tools for 
implementing the set sustainable development goals are legislative, managerial, educational and awareness-
raising. In this strategy, the priorities of sustainable development of the state are innovation and sustainability of 
the economy, its competitiveness in world markets, energy efficiency, digitalization of management processes, 
safe environment for citizens, stimulating their activity in different spheres of society. Environmental issues 
are a key aspect of the "Estonia 2035" strategy, which meets such sustainable development goals as rational 
consumption, sustainable cities and communities, combating climate change, and preserving the ecosystem. 
A recovery and sustainability plan, correlated with the "Estonia 2035" strategy, was presented to enhance 
the ability to implement the basic principles of sustainable development and obtain additional sources of 
funding. Estonian officials are actively engaging financial and political mechanisms to implement sustainable 
development. According to the plan approved by the European Commission, Estonia will receive 969.3 million 
euros in funding from the Recovery and Resilience Facility. They will be distributed along the following lines: 
ecological modernization, digitalization, economic and social sustainability. In addition, political mechanisms, 
in particular public diplomacy, are actively used. They are aimed at positioning environmental initiatives 
according to the state branding strategy and intensifying cooperation with stakeholders in the implementation 
of international environmental projects. Research results: sustainability and resilience of Estonia's  
development correlate with the need to implement environmental modernization of the economy and 
digitalization of management processes; implementation of the "Estonia 2035" strategy, national recovery  
and sustainability plan is facilitated by economic and political decision-making mechanisms at the  
supranational and national levels of government.

Key words: digitalization, energy efficiency, ecological modernization, green economy, public diplomacy, 
stakeholders, sustainable development.

JEL Classification: Q54, Q57, Q58

This is an Open Access article, distributed under the terms 
of the Creative Commons Attribution CC BY 4.0



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1. Introduction
The global challenges of our time and their 

foreseeable consequences actualize the formation of 
the environmental agenda, a key aspect of which is the 
ecological modernization of the world economy. The 
basic principles of the green economy are low-carbon, 
resource-efficient, socially inclusive (UNEP, 2022).  
The progressive transition to a green economy will 
improve resource consumption efficiency, decarbonize, 
create a safe living environment, and expand 
opportunities for sustainable development of the  
global community (United Nation, 2015). In this 
context, there is a growing interest among global  
policy actors in the formation of sustainable 
development strategies, a key aspect of which is the 
issue of ecological modernization. 

The main goal of the scientific exploration is to 
determine the environmental aspects and to specify  
the mechanisms of sustainable development in  
Estonia. The National Sustainable Development 
Strategy Resilient Estonia 21 was agreed upon by 
the government and enacted by the parliament back 
in 2005 (Ministry of the Environment, 2005). With 
this document, Estonia confirmed its intentions to 
implement the UN Sustainable Development Goals  
by 2030, updating the public on key ideas such as 
security of living space, quality of life, environmental 
friendliness and balanced economic development. 

The state is a member of the EU, so the key pillars 
of sustainable development correlate with the relevant 
initiatives of European institutions. In particular, 
it is about the program The European Green Deal, 
aimed at reducing carbon emissions by 55% by 
2030 and achieving climate neutrality by 2050. 
The implementation of the key principles of this  
program and the need to find additional sources 
of investment actualizes for Estonia the issues of 
intensifying the process of ecological modernization 
of the national economy, increasing the level of 
energy efficiency in order to ensure sustainability and 
sustainability of national development in the current 
political reality.

The comprehensiveness of the study consists in 
defining the environmental aspects and specifying the 
mechanisms of achieving sustainable development 
in Estonia. Systematic approach in the research will 
allow to specify essentially substantive characteristics 
of sustainable development of Estonia, its ecological 
aspects and to define their correlation with the 
corresponding initiatives of the EU. The method 
of analysis will contribute to the clarification of 
the essence of sustainable development, directions 
and mechanisms of its implementation. The use of 
the method of generalization will contribute to the 
formation of intermediate and final conclusions about 
the mechanisms of sustainable development in Estonia. 

2. The environmental component  
of Estonia's sustainable development

Sustainable development is seen by the Estonian  
ruling elite as the basis for ensuring the state's  
subjectivity in domestic and foreign policy. Given 
today 's challenges and threats to national security, 
much attention in the political discourse is paid to 
the issues of low-carbon development of the national 
economy, the formation of a safe space for citizens,  
the search for investment in the development 
of renewable energy sources and increasing the  
efficiency of resource consumption (Riigikogu, 2020).  
The general principles of the state's sustainable 
development are defined in the long-term strategy 
"Estonia 2035", which is considered by officials as 
an instrument of strategic management and budget 
planning. It was developed by the government on the 
initiative of various stakeholders (non-governmental 
organizations, politicians, experts, citizens) and  
enacted by the parliament. 

This strategy views the state's sustainable 
development through the prism of the following 
priorities: 1) development of human capital and the 
full involvement of public initiative; 2) innovation 
and sustainability of economic development;  
3) a safe environment for citizens; and 4) effective 
public administration (Estonian Government). The 
step-by-step implementation of these priorities will  
be carried out in the context of the EU-approved  
agenda (2019–2024), relying on the mechanisms 
of financial support for Estonia's sustainable  
development. 

One of the most important parts of the EU's  
agenda is combating climate change and the  
ecological modernization of the national economies 
of its member states. Consequently, environmental 
topics are key in the "Estonia 2035" strategy, 
which correlates with the following Sustainable  
Development Goals – responsible consumption, 
sustainable cities and communities, combating  
climate change, and preserving the ecosystem. 
First, it is about activation of state institutions and  
stakeholders in the implementation of ecological 
modernization of the national economy. Among the 
priorities are the efficient consumption of national 
resources, modernization of transport infrastructure, 
development of alternative energy sources, primarily 
offshore wind energy. Emphasis is placed on attracting 
innovation and research potential to develop and 
implement green technologies aimed at adapting to 
global challenges and gradually achieving carbon 
neutrality. 

Second, improving the functioning of the national 
ecosystem is seen by the ruling elite as the basis for 
the formation of a safe space of life of society and 
sustainable development of the state as a whole.  



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The question is about the introduction of new  
approaches in the formation of a sustainable and 
safe space of self-actualization of citizens. It should 
be characterized by a balance of the following  
indicators: safety of living, opportunities for physical 
activity, accessibility of goods and services. An  
important role in ensuring the efficiency of its 
functioning is assigned to the formation of a waste 
management system and the renewal of the public 
transport fleet in order to minimize the negative  
impact on the environment. 

At the same time, the global pandemic and the  
need to respond adequately to its consequences 
have brought to the fore the search for additional 
opportunities to ensure the sustainability of economic 
and political development. The European Commission 
created the Recovery and Resilience Facility, which 
provides for the coordination of EU and national 
governments' efforts to ensure sustainability 
and resilience. In this context, Estonian officials  
presented a recovery and sustainability plan  
correlated with the "Estonia 2035" strategy and  
agreed at the level of the European Commission. 
The Estonian plan focuses on several key aspects of 
sustainability that require financial support from  
the EU institutions. 

First, the ecological modernization of leading 
industries and transport infrastructure, ensuring  
energy efficiency and rational consumption of  
resources in order to gradually reduce the effects  
of the negative impact of climate change on the  
ecosystem of the state as a whole, the preservation 
of its biodiversity. Second, the promotion of an 
environmentally friendly space and appropriate 
infrastructure for citizens to live in, which meets their 
key needs in the context of adaptation to climate 
change. Finally, investing in the development of 
an environmental monitoring system to optimize 
management and control of the environment,  
predicting possible environmental crisis situations  
and responding to them in a timely manner to  
minimize the impact on the national economy. 

Among the tools for implementing Estonia's 
sustainable development goals, officials emphasize: 
1) legislative, aimed at improving the national legislative 
framework for environmental protection, achieving 
carbon neutrality, the introduction of key principles  
of the "green economy "; 
2) managerial, aimed at optimizing the communi-
cation of power institutions at the national and  
regional levels for the implementation of environ-
mental modernization, taking into account national 
interests, the specifics of regional development  
and the needs of citizens; 
3) educational, awareness-raising, aimed at creating 
an environmental culture of citizens, increasing the 
involvement of public initiative (Estonia, 2021). 

Therefore, the main ideas and principles of Estonia's 
sustainable development are documented in the 
long-term national development strategy, as well 
as in the recovery and sustainability plan. In these 
documents, the state acknowledges its responsibility 
to combat climate change and its consequences  
for the ecosystem and the livelihoods of citizens. 
At the same time, the implementation of Estonia's 
comprehensive environmental modernization is an 
integral part of the implementation of relevant EU 
environmental initiatives. 

3. Sustainable development mechanisms  
in Estonia

A key aspect of Estonia's sustainable development  
is the combination of economic and political  
influence mechanisms implemented by the  
government with the active support of EU  
institutions. In this context, the European  
Commission created the Recovery and Resilience 
Facility (RRF, 2020). It accumulates 723.8 billion 
euros, of which 385.8 billion euros are loans, and the 
remaining 338 are grants. These funds will be used 
to support member states' economic development 
and environmental modernization. The amounts 
of payments for the implementation of national  
recovery plans depend on the concrete results of the 
implemented reforms. At the same time, member  
states have the opportunity to raise funds from 
other sources to expand funding for areas that are a  
priority for them. The reallocation of financial  
resources is based on submitted national recovery  
plans, which should include roughly 37% of  
spending on the green economy and 20% on the 
digitalization of the economy and governance. 

The Estonian National Plan is focused on green  
and digital transition, economic and social  
ustainability. Its implementation will increase  
Estonia's economic development and GDP growth 
from 0.89% to 1.3% by 2026, create 4,000 additional 
jobs, and expand opportunities for structural  
reforms in the economy (European Commission, 
2021). Several of the most promising goals  
presented in Estonia's national plan can be  
distinguished (see Table 1).

According to representatives of the European 
Commission, the Estonian national plan provides 
for 42% of the funds to be used for climate goals and  
22% for digitalization. Consequently, a positive  
decision was made on the funding presented in the 
initiative plan for Recovery and Resilience Facility 
resources in the amount of 969.3 million euros.  
In order to intensify the implementation of the plan, 
Estonia was granted 126 million euros immediately 
after the approval of the decision by the European 
Commission (Press corner EC, 2021). Also, Estonia 



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is forming a national GreenFund investment fund 
of 100 million euros, which aims to ensure long-
term investments in environmental modernization, 
development and production of green technology.

Political mechanisms of sustainable development  
are also used quite actively in Estonia, in particular,  
it is a question of public diplomacy. First, the main idea  
of the state branding strategy is environmental 
friendliness and innovativeness in the formation 
of a space of opportunities for self-actualization of 
citizens. In this context, the Green Tiger platform  
was established to coordinate the efforts of public  
and private stakeholders in creating the prerequisites 
and further development of the green economy 
in Estonia. The state is positioning itself as a  
responsible actor for implementing the 2030 Agenda 
for Sustainable Development. In particular, the 
national report (Economic and Social Council, 
2020) was presented at the Sustainable Development 
Policy Forum. It emphasizes the positive dynamics 
of environmental modernization of the economy, 
increasing the use of energy from renewable sources, 
and confirms Estonia's continued participation  
in the implementation of the Sustainable Develop- 
ment Goals in domestic and foreign policy. 

Second, Estonian government members actively 
participate in special PR events aimed at popularizing  
among the public the ideas of sustainable develop- 
ment and increasing the level of environmental 
responsibility and culture of citizens. In particular,  
with the assistance of the World Energy Council, 
the Estonian Ministry of Economic Affairs and 
Communications held the World Energy Leaders' 
Summit (World Energy Leaders' Summit, 2021). 
During the meeting they discussed the problems 
of digitalization of the energy sphere, ways of 
implementation of ecological modernization of the 
world energy, peculiarities of development of regional 
energy systems and sources of financing the energy 
transition.

Third, Estonia is actively involved in international 
projects aimed at coordinating the efforts of partner 
states to implement environmental sustainability 
initiatives at the level of certain regions. The Executive 
Agency for Innovation and Networks has initiated 
a grant of 719.7 million euros for the implemen- 
tation of The Baltic Synchronisation Project. It is  
aimed at synchronizing the power grids of the  
Baltic states with continental Europe, so it involves 
cooperation between Estonia, Latvia, Lithuania and 
Poland. The Harmony Link across the Baltic Sea  
between Poland and Lithuania, built as part of the  
project, will be the basis for the formation of 
a renewable energy system (Innovation and Networks 
Executive Agency, 2020). They will ensure the 
energy sustainability of the entire region and enhance 
the ability of participating states to implement  
The European Green Deal.

Estonia, together with Poland, Lithuania, Latvia,  
and indirectly Finland, is involved in the Rail Baltica 
project, which aims to further integrate the Baltic 
states into the European rail network (Rail Baltica, 
2014). It involves the construction of electrified  
railway infrastructure. The project will take into  
account the following environmental aspects: 
1) the use of environmental technologies and materials; 
2) development of a route outside the Natura  
2000 protected area; 
3) installation of noise barriers; 
4) digitalization of the traffic control system. 

The funding comes from grant funds in the amount  
of 824 million euros allocated in the Connecting  
Europe Facility. Estonia itself will receive 235 million 
euros for implementation of its commitments.

The project provides for the construction of new 
multimodal passenger terminals designed to connect 
urban, intercity and regional connections with 
commercial and recreational areas. This will expand 
opportunities in the formation of so-called smart  
zones of comfort and safety of citizens, which are  

Table 1
The main goals of financing the Estonian national plan

Direction Main goals
Planned financing, 

million euros

Environmental 
modernization

Supporting businesses in making the green transition and introducing green technologies 220 
Introduction of renewable energy sources and energy efficiency 92
Greening public transport in Tallinn and building a terminal as part of the Rail Baltica project 96

Digitalization
Digitalization of public services 97
Supporting digitalization of small and medium-sized businesses 83
Formation of high-capacity networks in rural areas 24

Economic and 
social stability

Improving access to health care, digitalization of medical management processes 326
Stimulating the development of the labor market, creating conditions for a combination  
of training and work for young people and re-training opportunities

10

Improving the competitiveness of Estonian business, involving its representatives  
in regional and global projects

33

Source: Factsheet (2021)



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Vol. 8 No. 3, 2022 
one of the main components of sustainable  
development. The built infrastructure will also make  
it possible to integrate the management system of 
different types of transport connections, which will  
help boost trade and accelerate the transportation of 
goods in the Baltic states to the EU.

4. Conclusions
The main principles of the state's sustainable 

development are defined in the long-term strategy 
"Estonia 2035". Among the main priorities of the 
strategy, officials emphasize environmentally friendly 
and innovative economic development, safety in all 
spheres of life, and involvement of citizens' initiatives. 
It is synchronized with The European Green Deal and 

other EU environmental initiatives in implementation 
of these priorities. 

In order to attract additional sources of financing,  
the Estonian National Recovery and Sustainability  
Plan was presented, which focuses on the implemen-
tation of the green and digital transition, ensuring 
economic and social sustainability. Estonia aims to 
combine economic and political devices to implement 
the main qualities of sustainable development. 
Economic ones are connected with the attraction of 
financial support from the EU and the functioning of 
the national investment fund, and political ones are 
connected with participation in the formation of the 
environmental agenda, intensification of cooperation 
with stakeholders and implementation of the state 
branding strategy.

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Received on: 15th of July, 2022
Accepted on: 28th of August, 2022

Published on: 30th of September, 2022