Electric vehicles as a business opportunity for Estonia
Lauri Matsulevitš 09.06.2011
In Spring, Estonian government decided to use the funds received from the sale of AAUs to purchase 500 electric vehicles, develop a countrywide EV-infrastructure and set up a support scheme for early adopters.
However, the state's initiative should not be looked at as a mere transportation-related project but as an opportunity for Estonian entrepreneurs to gain a foothold in the rapidly growing e-mobility business.
In 10-15 years, 10-12% of cars sold will drive only on batteries. It appears, that in the future most profitable business opportunities in the industry are not related to car-manufacturing as such but can be found in other parts of the value chain – vehicle operation and value added services. This, in turn, means that new players outside the traditional car industry have an opportunity to enter the market and find their niches.
Estonian companies could have a chance in such areas as IT-and payment solutions, location-based services, battery recycling and second life, manufacturing and operating of charging stations, car sharing, load balancing, information- and entertainment services.
Thanks to the AAU-deal, the number of EV-s rolling on the streets will increase to at least 1000 in a couple of years.
This, however cannot be the final goal. First and foremost, all stakeholders, including the state, businesses and local governments should really think of how e-mobility in Estonia will evolve and how to benefit from it.
In addition: Coffee morning: From 1000 e-vehicles to new business opportunities
Of effectiveness and ineffectiveness of a state
Heido Vitsur 22.10.2010
It goes without saying that like in any other state also in our state one can find ineffectiveness. I would distinguish here two kind of ineffectiveness. Firstly a technical, organisational ineffectiveness and secondly ineffectiveness of essence, of principle. It is also true that the biggest originator of ineffectiveness is the boarders of administrative areas and action spheres.
But due to the problems and complicity of interdependence characteristic to state any country is more sophisticated organisation than any enterprise. Hence there are limits to use of some solutions which technically could be possible.
To argue that ineffectiveness is acceptable in Estonia would be wrong. In close future Estonia in cooperation with OECD should get ready the audit of our states activities; also a year ago on the conference of ‘Estonia after Euro’, which was organised by the Estonian Cooperation Assembly and Development Fund, Jüri Raidla called for conducting state audit of Estonia again for the benefit of effectiveness of the state. The team has started the work. Hence there are at least two sources outside Estonian administration preparing overview of the problems of our state and proposals for improvements and corrections.
It will not be easy. To connect or rearrange and to make more effective the net of institutions or services is never simple or cheap. Unfortunately we do not know well enough still how much one or another rearrangement of the past did cost us, the taxpayers. Let it be such simple things like moving Ministry of Education and Science to Tartu or uniting Estonian Radio and Estonian Television. And the expenses are the simple side. More important would be to know did the joining bring synergy, how much potential of development was created and what were the losses.
Such analysis and calculations are very sensitive, difficult and laborious and we have no tradition of doing or publicising them.
Hence this is one possible answer to the question why there seems to be present acceptance of situation at hand. Firstly the gut-feeling of experienced high executives says that nice reform proposals are in reality really as nice. Secondly the experience also proves that rearranging costs more than the most pessimistic prognoses were and take also more time as a rule.
Let’s take the digital prescription as an example. Today the talk of it has died down, system most probably is working, but how much problems did it create not so long ago. Regrettably we do not have deep analysis of the elaboration and application of this relatively restricted project. But it would be necessary for the benefit of the initiators and doers of new projects.
But at the same time it is probable that now it is more difficult to find someone from decision-makers who would want to take risk with more complicated reforms than that. Especially if the topic crosses the interdepartmental borders.
Nevertheless I am convinced that instituting technical improvements in the household of Estonian state has gone with dashing speed, so we have nothing to be ashamed of. I am sure that when the time is right the barriers between departments will be torn down.More difficult and more important is to increase the state effectiveness in fields which are not directly connected to large workloads in public sector, but to areas where problems do not have a clear ‘host’ or where the right timing in recognising the problem and finding a right solution to it could affect the speed of our development.
Misty view of lifelong education
Imre Mürk 20.10.2010
On the forum of adult education, held at 15th of October the problems and ideas for solutions of the sphere were talked about. As shown in the audit of the National Audit Office from September the field is governed and operated as if in the mist. Although there is European funds in the sum of 2 billion EEK foreseen for use, there is no common share vision, aims and understanding, how to spend it to gain the most.
For now there are 25 different measures dealing with lifelong education, 15 different institutions taking different steps and on top of this the funds from Ministry of Education covers just 60% of the money necessary. The rest 40% is covered by the funds of Ministry of Agriculture, Internal Affairs, Environment and also Government Office, who act is if in the bubble of their own. The result is separate and unconnected row of measures and nowhere to get a whole picture.
What we need, is systematic thinking of policies.
Economy is a social system with work allocation, level of which is determined by the competitiveness of enterprises. In this system act both entrepreneurs and employees. Just few years ago in this system actively participated more than 600 000 people, but the number has reduced close to 500 000. That leaves almost 100 000 out of the system. The main reason is incapability to compete successfully due to insufficient training – the precondition for the competitiveness of a enterprise is the level of training both for employer and employee. On broader scale this concerns also the level of public sector, scientist etc.
The level of training can be defined as education. Education is the ability of a person to understand the laws of society and nature and the conceptual connections between actions and phenomena.
Hence it is particularly important that while aspiring from industrial manufacturing towards knowledge-intensive economic model not just to find common goals, but to change the principles by which the training of people takes place both in formal education and adult education. Estonia acting in the economic sphere of European Union may not allow the prevailing of ongoing situation where the price convergence goes up, but the lion share of people in export sector work at most simple tasks, which does not pay in the world more than 8000-10 000 EEK in a month and for which the competition is in Indonesia, China or Vietnam.
Our only chance is to raise the level of training and cooperation of Estonian people as to create new jobs to enable better pay. Estonia's chance is to learn to produce and export goods and offer knowledge-intense services that others cannot do. Now how to achieve that?
The old saying goes that a barrel can be filled up only to the level of the shortest board. This means that no progress can be achieved before synchronised changes in all the important fields adjacent to the problematic area.
For example there is a plan of action Made in Estonia in the Ministry of Economy which foresees the luring of foreign investments to the state in six areas important to Estonia. These are:
1) information and communication technology
2) business and finance services
3) transport and logistics
4) mechanical and metallurgical industry
5) industry of electronics and electrical equipment
6) wood and wood industry
It would make sense to see the same priorities in the planning of adult education. Otherwise it might end up with lured investor leaving as there is not sufficient workforce with proper training.
Another possibility is to plan the adult education in the view of three challenges/possibilities before Estonia and also whole Europe. These are:
1) Aging (e.g. create in society capability of establishing social networks, lessen the digital gap of older generation, advance e-learning etc.)
2) The health care and wellness services (if we know of the growing demand in the world, we can strengthen the readiness and skills of our people to be put in use in different areas)
3) ‘Green economy’ (we create possibilities for self-education to entrepreneurs and more broadly in society to create understanding of the opportunities springing from spread of ‘green thinking’, i.e. in tourism, energy field and waste management)
Ott Pärna 08.09.2010
Of the use of IT solutions in the education for heightening the joy of learning and giving the Tiger Leap Programme new life.
Ott Pärna 05.03.2010
60s were the time of revolution. It was the time of turbulent change. And in any case it is the time fascinating to look back to, especially for those of us who hadn’t even taken their first breath yet.
Signe Viimsalu 29.01.2010
1 January 2010 was the date of entry into force of a new Bailiffs Act which established, for the first time in Estonia, a joint professional chamber of bailiffs and bankruptcy trustees and amended, among other acts, the Bankruptcy Act.
Heidi Kakko 13.10.2009
One of the major challenges facing us is to develop the local VC market and boost the number of innovative businesses
Ott Pärna 12.06.2009
Why countries without a licence to fail are loosing in the economic development race
Imre Mürk 17.03.2009
A businesslike group of enterprising people assembled at the Development Fund for a round-table discussion on reproductive medicine (artificial insemination) focusing on opportunities for exporting the service.
Heido Vitsur 21.12.2008
Less money, more regulations and more local activities
Indrek Kelder 08.07.2008
The Development Fund recently made its first investment and the media - disappointed by the...