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Largest cluster project in Estonia given almost 13 million EEK in support

14.09.2010

On 1st September, Enterprise Estonia decided to allocate 12.8 million Estonian kroons to a logistics cluster that unites Estonian transportation and logistics companies specialising in jointly marketing the location of Estonia on foreign markets, as they hope to increase their export turnover by almost 30% within the next five years.

The 2.5-year development project led by MTÜ Logistika ja Transiidi Assotsiatsioon (NGO Association of Logistics and Transit) is the largest cluster co-operation project initiated in Estonia to date both from the perspective of the number of companies involved as well as in regard to the investments made and the duration planned. The cluster unites 19 market leaders in the logistics sphere, including ports, terminals, a railroad company, an airport, and freight forwarders. According to Urmas Kõiv, the head of the logistics cluster, collaboration on the project stretches from CIS countries to China, Japan, India and North and South America.

“The cluster is an excellent example of what could happen if, instead of trying to cope on their own, the parties involved start co-operating in order to guarantee the success of the entire sector,” Kõiv said. “The result is a common understanding of and agreement on the logistics location of Estonia and the competitive advantages of our sector. By getting to know each other’s businesses and combining one another’s skills, we can invest in infrastructure, create new jobs, launch a supply chain master’s programme, and offer our clients innovative complete solutions in the form of dozens of innovative products and services. We are glad that Enterprise Estonia has also now decided to acknowledge our contribution to the development of Estonia’s economy.”

Kõiv believes that the cluster will help to increase the export turnover of its members at least 30% within the next five years.

“The Estonian logistics sector is very well-developed and has become a key sphere from the point of view of transportation. The creation of this cluster simplifies the establishment of partnerships on foreign markets and unifies the message sent out,” said Pille-Liis Kello, the Director of the Capability Division of Enterprise Estonia.

“Individual entrepreneurs are not able to make their way to major foreign markets due to the lack of opportunities, knowledge and finances,” added Viktor Palmet, the President of the Estonian Ports Association who has also been involved in the project. “Success is primarily the result of joint efforts and the will of groups of entrepreneurs from various spheres”.

The logistics cluster is also in close collaboration with other sectors that consist of the main partners of the companies operating in the sphere. Therefore, the success of the cluster is closely connected to the development of the forest, furniture, engineering, and food industries, as well as agriculture. The cluster’s partners also include other associations and clusters that have a significant impact on the logistics cluster’s ability to achieve its goals.

To date, Enterprise Estonia has allocated 20 million Estonian kroons for five full clusters - two IT clusters, two timber and wood clusters, and one developer of wind energy.

Read more: Estonia`s biggest innovation magazine HEI