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welcome to the big question I’m Angela Barns and today I’m joined by Sandra sarv estonia’s Deputy Minister for economy and Innovation it’s a pleasure to have you with us on the big question Sandra thank you very much for joining us thank you now Estonia is really interesting to talk about when it comes to the the digitalization of Public Services it was ranked ninth in the EU as well on the European commission’s 2022 digital economy and Society index but it’s been quite the journey since 1991 when Estonia became fully independent again so first of all can you just talk me through Sandra the economy and in infrastructure back in 1991 and how the country got to where it is now so just a little remark there uh the 9th we rank overall but when it comes to offering public Digital Services eston always ranks in top three as EST has 99% of all public services a available digitally in 1991 Estonia regained its independence and we had been illegally occupied by the Soviet Union for half a century uh so for five decades there was virtually zero economic growth um 1938 prior to the Soviet occupation estonia’s economy was roughly the same as finland’s which is our Northern neighbor roughly could say that both Finland and Estonia had 2,500 International dollars GDP per Capal capita 1991 estonia’s GDP per capita was even lower than prior than half a century earlier so roughly 2,000 Euros per capita so you can imagine half a century of virtually no Economic Development compared to Finland for instance who had had half a century to have economic focus and um and support and their GDP per capita by 1991 was the same as Estonia is today uh so around 28,000 um Euros um per capita G so yes uh this half a century uh didn’t bring us any new developments our infrastructure was outdated there was virtually no free economy you know it was a communist era uh in our history so we had to have a fully fresh restart back in 1991 and luckily we had very young uh fresh politicians at the time who thought that Estonia is going to need to do something different and we did was it necessary to build public infrastructure the way that you have done and how do you think it has put Estonia ahead so half jokingly we say that we were too poor to afford anything else which is in the same time it’s also a correct thing to say h so we skipped a lot of the steps that people were doing in in the second half of the 20th century uh so we went virtually from 1940 uh to the new era of Technologies um we uh realized that we need to be efficient which is one of the keys why Estonia is so digitalized in the first place digitalization brings you actually efficiency because you can do the same things with less resources with less Workforce Estonia is only a country of 1.3 million people you imagine we’re not so big um but we don’t like to be called tiny we like being called compact so we had to adopt uh digital systems in order to offer services in a more efficient way the very first digital service that we had back in the year 200000 was actually tax declarations so instead of queuing in line we digitalize the service and nowadays it takes less than um 5 minutes to declare your taxes so efficiency but the private sector hasn’t subscribed in the same way has it why do you think that is is it to do with the trust and digitalization or something else no not at all I mean still all of the companies are set up online you cannot even set up a company you know physically on paper somewhere and still all the taxes are declared online but the use of digital Technologies I think has to do with the fact that we have so many companies as I mentioned every 10th Estonian has their own company 94% are micro companies I mean if you set up your ice cream booth somewhere uh for the summer perhaps there’s not so much to digitalize uh so I think this is this is where the secret lays why we’re not so uh digitalized in the business sector uh is because we have so many companies and a large some of them are small companies what do you think other EU member states could learn from how you have progressed and how you’ve digitalized completely your public services well uh I don’t know if I’m allowed to say this on air but Estonia has something called the Skype Mafia so Skype was set up initially in Estonia and nobody uses Skype anymore but it was uh very popular you know let’s say 10 years ago 7 years ago and so Skype was set up in a and those guys who were the early emplo guys and girls who were the early employees at Skype they went on and they built their own startups and companies and Estonia has 10 Tech unicorns uh which per Capi the most in Europe and those people who built Skype then went to build on their own uh companies and those companies of the first gen then went on and built their second gen companies and now we’re already third gen Skype companies and this community is very very tight Estonia is a compact country if you remember so people talk to one another and they give advice and this this is breeding ground for startups if I may say so that’s really impressive 10 unicorns in Estonia and that is impressive per [Music] capita what does Estonia have to offer as well a foreign corporation wanting to set up a company in Estonia I know you’ve given rise to globally successful companies like bolt Skype and wise yeah to name a few it’s the most competitive tax environment in the C countries for six or seven years in a row already uh we have 0% corporate tax and reinvested profits so unless you take out dividends as long as you reinvest uh there’s no corporate tax in Estonia um you know which which is a competitive Advantage Estonia attracts a lot of capital uh per capita again so we say per capita Estonia always wins in the year 2022 Alone um Estonian startups attracted 1.3 billion EUR um and this was on average six seven times more than uh in Europe per capita so that’s the E residency card is it the e- residency card um is similar to estonia’s national ID card so national ID card in Estonia is mandatory so what’s E residency is we figured we can give access to estonia’s business environment with the similar type of digital ID it’s it’s not your personal identity document you cannot travel with it however you can access those access those EST stus Digital Services you can open up a company online wherever you’re based in the world um and you can open up aany in Estonia in 15 minutes and 33 seconds which is a world record uh so of course if this is only if you do it regularly if um if you’re a newbie it would take you a couple of hours but still it’s very efficient you can fully declare taxes online you can provide digital signatures for documents you can acquire property you can acquire new companies without ever having to show up physically and currently we have globally over 100,000 IR residents who have opened around 30,000 companies in Estonia and uh they not only bring us economic benefit by paying some taxes in Estonia but they employ locally they bring new innovation to Estonia so we’re really happy with the E residency project it sounds uh like a very appealing place then for startups to do business and Estonia is relatively small as we’ve said uh do you think that’s made it easier to create Digital Services so both yes and no it’s made it easier uh because obviously uh you have only 1.3 million people however it’s more difficult because as we started in 1991 we didn’t have a lot of resources meaning Capital so if you are larger country if you have more Capital it’s easier to uh to build the best systems uh possible so we’ve always had to innovate and uh and be more inspired with what we can do with the resources that we have that’s great to get your insights on all of that Sandra Sarah thank you ever so much for talking to ask in the big question it’s been a pleasure to have you on the show thank you so much for having me [Music]