It is no secret that the economy is America and much of the world is struggling. The amount of debt that the US government has piled up the past few years is absolutely staggering. While many American politicians believe that spending more money is the way to boost the economy, European countries like Greece, Spain and Italy has shown us that massive government spending is not the answer.
Quite the opposite. Massive government spending is the problem. When government spends it takes away from the private sector an the economy becomes less vibrant. Entrepreneurship and innovation is stifled and economic growth slows dramatically.
Today there is a small country in Eastern Europe that is giving all of western civilization hope. The country is Estonia.
Here is an article from CNBC that provides the details of an amazing economic turnaround in the country of Estonia. The article is titled: “Estonia Uses The Euro, and the Economy is Booming.”
In 2008 and 2009 the economy of Estonia shrunk by 18% as a results of the global financial crisis. Because the country’s revenues had decreased dramatically, the politicians of Estonia put in austerity measures to significantly cut costs. (By the way, these politicians were reelected.)
Today Estonia’s economy is growing at a robust 7.6%, five times the euro-zone average. The article also states: “Estonia is the only euro-zone country with a budget surplus. National debt is just 6 percent of GDP, compared to 81 percent in virtuous Germany, or 165 percent in Greece.”
So, what does this article have to do with entrepreneurship and the web business marketplace. In a word, “Everything.”
The article states: “Innovative young companies have been at the forefront of the Estonian revival thanks to successful startups like the web-designer Edicy, online money transfer service Transferwise and point-of-sale software developer Erply.”
“The daddy of them all is Skype, which was developed by a quartet of Estonian software geeks with their Swedish and Danish buddies back in 2003, and was bought up by Microsoft last year for $8.5 billion.”
“In Estonia we have this national trait of just getting things done,” says Tiit Paanenen, the site leader at Skype Estonia.
“I’ve tried to work out why this is and I think it’s because we are small. The circles working on the same subject all know each other, so you create this sense of accountability with each other. If you screw up everybody knows about it.”
Paanenen goes on to say: “Estonia itself was like an innovative startup, when it suddenly became independent in 1991. Old hierarchies were overturned and youngsters thrust into key political and business positions as the country built an economy from scratch.
“One of the results is that we are very competitive, because of the efficiency, because of the use of technology in the areas where otherwise you’d have a lot of overheads and waste,” the shaggy haired executive (Paanenen) said in an interview.
We can all learn a lot from the success of Estonia and their thriving entrepreneurial sector. The entrepreneurs of Estonia are creating and they are innovating. They are not afraid to take risks, they are competitive and they hold each other accountable.
This country is a great example of what can happen when government gets out of the way and allows entrepreneurs to do their thing. And that is to “create and to innovate.”
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