The European Union's long-term budget includes a European fund from which Estonia will receive a total of €6.5 billion for its national partnership plan for 2028–2034. Three-quarters of that amount must already be tied to specific projects by the end of next year.

Ministries have submitted funding applications to the Ministry of Finance explaining what they would like to do with the money. The total value of the applications is €13.3 billion, meaning it exceeds the available amount by more than twofold. The Ministry of Finance therefore stressed that these are preliminary requests that have yet to be negotiated.

The applications are divided by objective and the first section concerns support for sustainable prosperity, linked to the economy and competitiveness.

The Ministry of Justice and Digital Affairs is seeking €260.4 million to carry out the digital transition, stating that by 2035 Estonia should become the world's most trusted and self-operating artificial intelligence-based state.

"The reform addresses data management, data-driven governance and artificial intelligence as a single system, as a result of which the functioning of the state will become measurably faster, cheaper and more transparent," the application states.

As a result of the reform, access to interoperable data should become automated, the administrative burden should decrease because reports will move automatically and in machine-readable form and there are also plans to introduce artificial intelligence systematically throughout government. In addition, Estonia plans to create large-scale computing capacity, such as an Estonian branch of a European AI gigafactory, which would make it possible to develop high-impact artificial intelligence models.

Ultra high-speed internet requires €360 million

The Ministry of Justice and Digital Affairs is also seeking €387 million to invest in measures that would reduce duplication in the country's information and communications technology sector, help introduce centralized services and phase out riskier software.

With that funding, public services would be developed on central platforms rather than as separate solutions, while similar functions would be standardized and automated nationwide. The ministry sees the private sector as a partner. Among other things, the reform would help introduce artificial intelligence and aims to ensure that Estonia's digital state provides secure, personalized and integrated public services.

The third application submitted by the ministry concerns the creation of an ultra-fast and resilient communications network across the country that would serve as the foundation for the digital transition, smart industry and national security. The ministry is seeking €360 million for that purpose.

"The goal is to cover the main transportation corridors and white areas, including especially Estonia's eastern border, with 5G, build access networks to end users and strengthen the physical protection and autonomy of critical communications infrastructure," the ministry said in describing its plan.

More specifically, the reform would ensure the resilience of communications, support 5G transportation corridors, build cell towers in mobile service white areas and provide last-mile connections to addresses that do not have fiber-optic access.

In addition, the ministry wants €12 million to reform digital skills and competencies. The plan is to turn the Digital State Academy into an environment that would provide digital training primarily for the public sector and to develop a digital skills training system for the public sector.

Part of the funding would also be directed toward communications on digital services and the digital state, as well as digital mentoring measures so that older people and others with fewer digital skills would be able to participate in the digital society.

2+2 highways and Rail Baltica

The Ministry of Climate is seeking €732.8 million to develop a high-quality and energy-efficient housing stock. The amount would cover the creation of financial incentives and other support services that would help property owners make buildings more energy efficient.

"In Estonia's context, this is especially important given that the building stock accounts for more than half of the country's total final energy consumption. Implementing the reform will improve the quality of housing across Estonia, reduce the renovation backlog and support people's continued residence in regional cities and small towns," the ministry said in explaining the proposal.

For the 2028-2036 period, the plan calls for direct subsidies, loans and guarantees for apartment buildings, as well as loans, guarantees and capital reimbursements for smaller residential buildings.

The Ministry of Climate also wants to reform mobility and infrastructure, which according to the application would require €416.7 million. The ministry argues that several sections of Estonia's core TEN-T road network do not meet requirements and that the limited load-bearing capacity of bridges and viaducts hampers the movement of heavy cargo and allied forces.

The investment would be used to rebuild 1+1 road sections of the core TEN-T network into 2+2 roads and to reinforce bridges and viaducts. Funding would also be directed toward the construction of Rail Baltica to create a fast connection to Europe's transportation network.

"Indirectly, the entire population of Estonia, 1.3 million people, will benefit because security and the country's rapid response capability will improve," the Ministry of Climate said in its application.

The Ministry of Climate also wants to carry out a reform to improve the resilience of the natural environment at a total cost of €326.1 million. The reform includes soil and land-use reform, with investments directed toward preserving and improving soil quality, as well as investments to ensure the sustainable use of nature, protect water and marine environments, make contaminated legacy sites safe, speed up the reuse of areas damaged by mining and ensure the safe handling of radioactive waste.

In addition, the plan includes a Natura 2000 support program to promote biodiversity aimed at private forest owners, compensating them for income lost because of restrictions, as well as support for maintaining heritage meadows to ensure that they continue to be managed through mowing and grazing.

New ferries

The Ministry of Climate is seeking €200.7 million to support the transition to clean energy. In its application, the ministry explains that the reform would primarily address problems associated with the use of fossil fuels, thereby helping ensure energy sustainability. In addition, the measures would help diversify the energy production portfolio and create opportunities to make use of critical mineral resources.

With the investment, the ministry wants to replace fossil fuels in heat supply with clean energy, increase the production and share of renewable gases in the gas network, carry out studies of critical raw materials and minerals and establish the expertise of a nuclear regulator, which is a prerequisite for building a nuclear power plant.

Regarding the latter, the application notes that €12.6 million will be needed between 2027 and 2035 to strengthen the nuclear regulator's capacity, with the money directed toward staff training and information technology investments. Nearly €1.1 million would be spent on upgrading the national early warning system for radiation hazards, including replacing measurement and laboratory equipment and integrating it with information systems.

The Ministry of Climate would also like to use €178 million in support funding to increase the competitiveness of the maritime sector. This would require investments in developing and making maritime transport and port infrastructure more environmentally friendly.

"The plan is to refurbish and acquire new ferries for various routes, develop port infrastructure and shore power capacity and strengthen the network of small ports. There will also be a focus on reducing the environmental impact of the State Fleet and work vessels and on modernizing existing ships. In addition, plans call for the development of digital solutions and support for retrofitting ships in order to increase the efficiency and competitiveness of the maritime sector," the ministry said.

The Ministry of Climate would also like to carry out a reform to improve environmental and climate awareness with European funding, which would cost €10.8 million. The reform is intended to increase climate awareness among the population, improve climate-related expertise among businesses and municipalities and strengthen cooperation between the public and private sectors in the field of environmental knowledge.

Plans for an extensive EV charging network

The Ministry of Climate has also requested €130.1 million for a reform of clean industry, circularity and environmentally sustainable business. Its focus is on global climate change, the loss of biodiversity and environmental pollution.

The goal of the investment is to increase the competitiveness of Estonia's economy through the principles of circularity and environmentally friendly solutions by developing reuse, the use of secondary raw materials and digital solutions that make it possible to optimize production processes. As a result of the reform, value chains are expected to become more local and more resilient.

The Ministry of Climate also wants to spend €41.8 million to reform cross-sector governance for climate change adaptation. The reform would ensure that Estonia has up-to-date data, forecasts and risk assessments for adapting to climate change in order to prevent damage and direct adaptation investments to where they will have the greatest impact.

To achieve this, the ministry wants to improve weather forecasting capabilities, ensure the resilience of the hydrometeorological monitoring network, support society's ability to adapt and increase local-level capacity to use that knowledge in planning.

The application titled "Connected Estonia With a High-Quality Living Environment" notes that Estonia's electric charging infrastructure does not cover critical nodes, hindering the adoption of more sustainable vehicles.

Through the €284.2 million reform, the Ministry of Climate wants to develop sufficiently extensive alternative fuel infrastructure, particularly electric charging infrastructure, that could be used by passenger vehicles, vans and heavy trucks.

The plan would also continue the development of bicycle paths across Estonia, maintain and improve railroad infrastructure and invest in regional airfields in order to ensure fast alternative connections with the islands.

The Ministry of Climate wants to invest €154.2 million in a water services reform consisting of investments in the water reform roadmap. More specifically, the application outlines support for water utilities in preparing for mergers, improving water management infrastructure and increasing the crisis resilience of water supply systems.

In addition, there are plans to modernize wastewater treatment systems and strengthen cybersecurity, management and automation systems so that essential water and sewer services can withstand power outages, malfunctions and extreme weather conditions.

The Ministry of Climate is also seeking funding for a reform of data-driven environmental management and information technology services. With €5.3 million, the ministry wants to create an integrated system in Estonia for environmental data, monitoring and decision support that would make it possible to design and implement policies on the basis of evidence, ensure the country meets its international obligations and support informed decisions to reduce environmental impacts and improve the quality of the living environment.

Ministry of Culture wants €706 million for urban center development

The Ministry of Culture would like to carry out a reform focused on high-quality spatial planning and the development of historic urban centers. The measures, which would cost €705.6 million, are intended to strengthen Estonia's city centers by ensuring they combine good housing, jobs and services.

To achieve this, the hearts of urban centers would be developed to increase their competitiveness, municipalities would be supported in urban planning, housing availability would be improved, buildings would be renovated, financing models needed by the private sector to support renovation and construction would be created and construction and planning processes would be simplified through digital solutions.

The Ministry of Culture also wants to improve the competitiveness and export capacity of the creative industries and is seeking €31.8 million for that purpose.

The reform aims to shift the treatment of the creative industries from a narrow cultural policy issue to a broader economic policy context. To do this, mechanisms would need to be developed that take into account the specific business models of creative industry companies so that existing support measures and funding logic are better suited to them.

According to the Ministry of Culture, supportive services would be needed to help companies enter international markets and there is also a need to strengthen the ability to develop and commercialize intellectual property.

€1.3 billion for a technology development leap

The Ministry of Economic Affairs and Communications is seeking €1.33 billion from the fund to boost the competitiveness of Estonia's economy through a technological leap, particularly in manufacturing. Estonia's industrial sector should become less dependent on low-value subcontracting, while the share of high-tech production should increase.

To achieve this, the ministry wants to support investment in fixed assets, the digitalization and automation of companies, help exporters diversify their target markets, increase access to capital and companies' investments in artificial intelligence, raise productivity in manufacturing and strengthen economic security and crisis resilience.

The core of the reform is a lead company program designed to encourage internationally competitive companies to take a leading role in strategic sectors and build comprehensive cooperation ecosystems or industrial programs around them.

In addition, the reform would create an industrial investment instrument that takes regional characteristics into account and would support, among other things, industrial development and the capacity of the defense industry.

The Ministry of Regional Affairs and Agriculture is seeking €603 million to implement the vision of a polycentric spatial development model for Estonia.

With the investment, the ministry wants to create a unified framework for directing state planning interventions geographically. This would mean slowing the concentration of development around the capital, clearly describing how each investment supports a polycentric settlement model and designing activities based on the specific characteristics of each region. The plan also includes the introduction of smart city solutions and a digital development leap for municipalities.

Ministry of Social Affairs seeking €229 million for hospitals

The Ministry of Social Affairs is seeking €229.2 million to reconstruct hospitals in the hospital network and infrastructure for specialized and general care services. The first investment package would renovate the hospitals included in the Hospital Network Development Plan, with the exception of infrastructure related to psychiatric services.

As a result, the hospitals would become more energy efficient, use their space more effectively and build new wings.

The second investment package would implement the healthcare sector's green transition action plan, which includes investments in the circular use of supplies, vehicles powered by renewable energy, drone solutions and the expansion of telemedicine solutions.

The third investment package would improve the energy efficiency of specialized and general care homes that provide round-the-clock care.

The second major objective under which the applications are grouped is supporting defense capability and security. In this area, the Ministry of Justice and Digital Affairs is seeking €189 million to strengthen cybersecurity. With the investment, the ministry wants to create a cyber and digital services management center and a cyber forensics laboratory under the Information System Authority, strengthen the country's cyber shield, organize international cyber exercises and much more.

There are also plans to adopt new technologies by ensuring the safe use of artificial intelligence, implementing quantum technologies and quantum communications and introducing quantum-resistant solutions.

The Ministry of Justice and Digital Affairs is also seeking €168 million to modernize state communications. The goal is to turn it into a comprehensive and crisis-resilient service, with investments directed toward the parallel deployment of multiple communications technologies, improving the resilience of critical infrastructure and creating frameworks for using commercial networks in times of crisis.

In addition, the plans would create the conditions necessary for the adoption of cloud services for critical information systems and modernize the national electronic identity infrastructure.

Ministry of Defense after new reliable ships

The Ministry of Defense wants to use €76.8 million to strengthen Estonia's marine pollution response capability in order to meet the country's international pollution-control obligations and develop the capacity to respond to chemical accidents at sea.

To do so, Estonia would procure a next-generation vessel or vessels for removing oil and chemical pollution, conducting underwater operations, laying cables and responding to crises more broadly. The vessel would be built to classification society standards and would have to meet Ice Class 1A Super requirements, ensuring year-round reliability even in severe ice conditions and giving it icebreaking capability.

The minister of defense is also seeking nearly €1.79 million for the Defense Resilience project, which would begin drone training across all units of the Estonian Defense League so that every field would have the minimum required drone capability. The goal is to ensure that the Rescue Board has support for mass evacuations during crises and to improve day-to-day guard services at all facilities of the Defense Forces and the Estonian Defense League.

The Ministry of Defense also wants to invest €17 million in artificial intelligence models and a cyberdefense testing environment in order to create an accredited testing and validation environment for the Defense Forces and the defense industry that would ensure access to NATO innovation networks. The reform should also ensure the operation and further development of an artificial intelligence training environment in order to speed up the development of autonomous cyber capabilities.

The Ministry of Climate plans to increase the crisis resilience of energy infrastructure and is seeking €129.4 million for that purpose. The funding would be used to improve the cybersecurity of the electricity and gas networks, acquire backup equipment, strengthen the perimeter around key substations and create drone defenses and physical shelters.

The Ministry of Defense is seeking €178.8 million to develop innovation and industrial capacity in the defense industry.

The reform consists of four sub-measures: a support program to cover capital costs for launching or significantly expanding production in the defense industry, a state co-financing measure for European defense industry programs, the creation of a center with testing laboratories and test areas for the defense industry and the construction of basic infrastructure for defense industry parks.

Fighting narcotics crime

The Ministry of the Interior is seeking €220.2 million to fulfill obligations in the field of internal security arising from European Union legislation. The funding would ensure that experts receive sufficient training, that the digital forensics capability of the Police and Border Guard Board is raised to a high standard and that the police establish a permanent capability to gather and analyze information in cybercrime investigations.

In addition, the ministry wants to create a capability to combat drug crime in line with European Union expectations, including the early detection of new synthetic substances, establish a systematic supervision model for civilian firearms in order to reduce the risk of misuse and create a comprehensive system to combat human trafficking.

The Ministry of the Interior has also submitted an application for €198.7 million to implement European Union asylum, migration and integration policy.

The program focuses on developing migration-related databases, maintaining information technology systems, increasing the capacity of migration screening and follow-up procedures, providing counseling services to third-country nationals and training officials so that they can process legal migration cases lawfully.

Shelters should be no more than 3 minutes away

In addition, the Ministry of the Interior would like to spend nearly €903 million to improve the crisis preparedness of internal security agencies. More specifically, this would mean increasing air and maritime rescue capacity, involving volunteers, including the creation of a crisis reserve, strengthening volunteer training, improving residents' preparedness for crises and building shelters and shelter locations so that in the event of an air attack people would be able to reach protection in the nearest shelter within three minutes.

The ministry also wants to create evacuation sites for local governments, while the emergency warning system would be developed into a comprehensive and reliable system capable of quickly alerting people in the event of an attack.

To maintain and develop aviation capability, the Ministry of the Interior is seeking €266.8 million. The money would make it possible to replace old helicopters with five new multi-purpose helicopters, acquire an additional surveillance aircraft that could also transport patients in need of medical care, build a new main base in Tallinn for housing and maintaining aircraft operated by the Police and Border Guard Board and establish an additional helicopter base, initially planned for Tartu.

The investment would also include training helicopter personnel, building helicopter landing pads next to emergency departments at regional hospitals and expanding refueling options for the Police and Border Guard Board's aircraft across Estonia.

The Ministry of the Interior is also seeking €282.6 million for mandatory measures to implement European integrated border management and the common visa policy. The investment should ensure that Estonia's border as an external border of the European Union is monitored and protected, that work related to Schengen visas is organized more efficiently, that the European Union's digital travel application is introduced and that Schengen information exchange is ensured.

In addition to supporting sustainable prosperity, the ministries' applications also concern strengthening social cohesion, preserving quality of life and strengthening democracy and the rule of law.

The European Commission presented its proposal for the European Union's long-term budget for 2028–2034 last summer. The new European Fund, which will be distributed among member states, forms the first pillar of that budget.

Based on the ministries' applications, discussions will now begin and the government will discuss the allocation of support in August and September. In the first stage, 75 percent of the national plan's volume, or €4.97 billion, will move into planning.

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