Traditional Estonian industries include oil shale mining, shipbuilding, phosphates, electric motors, excavators, cement, furniture, clothing, textiles, paper, shoes, and apparel. Many of these industries stagnated after independence, deprived of their Soviet markets and sources of cheap raw materials. Yet the sector has been growing at a rate of 3 percent (1996 estimates), mostly due to the rapid privatization and the entry of foreign (mostly Scandinavian) investors in electronics, cement, chemicals, and forest products. Estonia has developed adequate assembly capacities to supply electronic components to leading Scandinavian telecommunications companies and suppliers. In addition, with its low taxes, low labor costs, and trained workforce, the country is an ideal location for electronics manufacturing. In early 2001 telecommunications giant Ericsson (Sweden), the world's leading maker of telecommunications equipment, sold its loss-making mobile handset operation, dramatically cutting its orders with Elcoteq (Finland). Elcoteq terminated the manufacture of Ericsson handsets in its Estonian subsidiary, Elcoteq Tallinn/ET, which was responsible for one-quarter of Estonian exports in 2000. But Elcoteq quickly refocused on mobile systems components for Ericsson, reflecting its long-term demand. ET continues producing handsets for Nokia (Finland), and will launch systems components production in Estonia later in 2001.
In early 2001 telecommunications giant Ericsson (Sweden), the world's leading maker of telecommunications equipment, sold its loss-making mobile handset operation, dramatically cutting its orders with Elcoteq (Finland). Elcoteq terminated the manufacture of Ericsson handsets in its Estonian subsidiary, Elcoteq Tallinn/ET, which was responsible for one-quarter of Estonian exports in 2000.