average electricity price before vat paid by estonian companies in the first half of this year was 16 cents per kilowatt - hour, which is a little below the european union average, but above the price of 8 cents in finland or 11 cents in sweden. european union member states have also passed support measures and industrial policy measures that could create inequalities in the single market of the union. several countries will continue to pay energy subsidies this winter, though in much smaller amounts than before. policies that can develop the green and digital economies will depend on the budgetary capacity of different countries and the fiscal choices that they make, and countries like france, germany and italy have recently proposed new largescale initiatives. the good growth in the turnover of estonian companies was last year encouraged by high inflation elsewhere in the world, but that picture has now changed. growth has slowed in estonia's main export markets and purchasing power has declined, making it very difficult for companies here to pass higher input prices on to purchasers. companies trying to cope with their costs growing relatively fast will have to continue to find efficiencies in production and business processes, as productivity indicators show there is still a lot of room for improvement in this. 4 / 6 bis - central bankers'speeches labour productivity in estonia, shown as real gdp per employee, had been approaching the average level in the european union but fell by almost 5 % last year because employment increased just as gdp contracted, and estonia fell back to 18 % below the european union average. there has been no improvement this year either, which means that the target set in the government's estonia 2035 strategy of productivity surpassing the european union average level has actually been made more distant. some of the decline in productivity is sure to prove temporary, as there is a lag in the reaction of the labour market to events in the economy, and employment has not declined to the same extent that output volumes have. the gap from estonia to wealthier countries is, however, still clearly evident. the branches of the economy that suffered because their earlier supply chains were wiped out by the outbreak of war will have to change their business models. companies that are in difficulty because of the gloom in the economies of their main export markets will have to try to find new markets. we will be releasing the latest eesti pank economic forecast in a couple of weeks. the final version is still being polished, but the figures recently released for gdp in the third quarter indicate that the

##e taught for thirteen years in the prestigious columbia university in new york. there he mainly focused on development economics, earning a great reputation as an international advisor on the subject. he died unexpectedly and still relatively young at only 51. the view of ragnar nurkse of the time notes his thorough knowledge of economic theory and practice, his original ideas, and his clear vision. he was the sort of man who is clearly needed in the world today. when estonia regained its independence it chose the path of reform, with a unique combination of conservatism, innovation and a recognition of its own limitations. estonia chose once again the road to europe. eesti pank concentrated on stabilising the economy and on earning and maintaining confidence in the estonian currency. today the european union and its member states are estonia ’ s main partners both economically and politically. working together with the european system of central banks has become a matter of course for eesti pank, be it in monetary policy, financial stability or economic analysis. we are in an unprecedented position to engage in defining the economic world around us, and our input is listened to. evidently there are limits on how much a small country can contribute in the functioning of the european union, because smaller countries have fewer resources. but we can widen bis central bankers ’ speeches those limits by making the best use of our resources, by learning from our own experience and that of our partners, and by working well together. working together is particularly important right now, at a time of geopolitical tensions in and around estonia and of deepening insecurity. it is right now that we need to find the ideals, the ideas, and the goals that can bring us together, and we must work together to achieve them. i wish us strength and good luck in all of this. thank you again. bis central bankers ’ speeches