Estonia’s economic background
At the heart of the Baltic Sea region, which comprises of Europe’s fastest growing economies, is a Jewel of a country called Estonia. Estonia is a small country that has experienced economic and political stability for a long time, and it has become quite famous in the region for the low cost and the ease of doing business, as well as fairness and equality shown to investors.
Through different governments that have been elected into office, the government policy on investment and foreign policy has been quite liberal and consistent when it comes to issues regarding:
Privatization
Price liberalization
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Currency stability
Effective and current legislation
Through being very forward thinking about the above issues, the country has managed to attract one of the highest foreign direct investment per capita for any nation. The government positions itself strategically by having a very positive attitude towards welcoming foreign investors, especially into sectors that support regional development, innovation and export markets from the country.
Contrary to what you would expect, in countries encouraging foreign direct investment, Estonia has not based its attraction of foreign direct investment on schemes specifically designed to attract, support and encourage such investment.
Instead, the country has made a conscious effort to create a favourable business environment and this has led to a natural attraction of foreign investors into the country. Needless to say, this is the hallmark of a strong and confident economy.
Financing of local businesses in the open market
As such, foreign direct investment has played a pivotal role towards building the country’s economy, and this is not any different when it comes to raising capital for local companies that have a strategic role in providing housing for the countries inhabitants.
To be more specific, companies like Hüpoteeklaen OÜ, have, on several occasions, managed to raise substantial financing through bonds floated in the NASDAQ Baltic Exchange.
Foreign investment in this company represents a vote of confidence not only in Estonia as a vibrant economy, but also on a specific sector of the economy, i.e. the housing market, that has shown a lot of fragility, regionally and in the wider continent since the 2007-2008 economic crisis.
You could read http://www.sorainen.com/en/Deals/3513/hupoteeklaen-eur-4-million-secured-bond-issue for more details about one of the bonds to Hüpoteeklaen OÜ that was very successful and attracted funds without a problem.
Background on Hüpoteeklaen OÜ
This Estonian company was founded in 2009 in the middle of a fragile property market following the economic crisis that shook the whole world, especially Europe during this trying period. Even when people in wider Europe couldn’t access credit as easily as before, this company was bullish and showed confidence in the local economy, providing mortgage loans, among other financial services, to citizens.
The company’s management and its strong background in banking and real estate in Estonia gave people, who still believed in real estate, a chance to make their dreams come true even when the rest of the financial sector, including banks, were not very supportive of local borrowing.
This bullish confidence has paid off over the short time that the company has been in existence as is witnessed by its dominance and pole position as a market leader in the mortgage loans market.
