International security architecture is undergoing major changes, and development cooperation (DEVCO) has not been immune to those, in both values and practices. In March 2025, the International Centre for Defence and Security completed a study on the impact of global trends on Estonia’s development cooperation, commissioned by the Ministry of Foreign Affairs. This is what it has found.
Until recently, linking the funds to values used to be fundamental to many western donors. Now, however, countries are increasingly preoccupied with protecting their own business interests.
For instance, this is how Sweden—traditionally one of the staunchest adherents of the value-based approach in the DEVCO donor community—now thinks and behaves: it has significantly cut its development cooperation funds and shifted its focus to promoting exports. Although for slightly different reasons, the Netherlands also followed this business-focused trend,
In addition, the world’s major DEVCO trends certainly include the increasing prominence of non-democratic donors—such as China and Russia—and their attempts to acquire and consolidate new spheres of influence with the support of development funding.
In short, the world is becoming more cynical and more interests-based, or it might have always been that way, and it was we who wanted to believe that the world was different.
If these trends are inescapable, will they affect Estonia’s current behaviour in the field of development cooperation? And how?
As a small country, Estonia has always been guided by both interests and values when pursuing its DEVCO policies. On the one hand, Estonia has tried to ensure its own security while projecting an image of a responsible country. On the other hand, Estonia’s development cooperation has been grounded in values of democracy, the rule of law, an efficient and transparent state, civil rights, and protection of the weak.
Unite and Conquer
Having delved deeper into Estonian development cooperation, this study has found that Estonia does not need to reinvent its policies but rather capitalise on its strengths. For instance, coordination at a national level and cooperation between different stakeholders could be further improved. Perhaps, Estonia could also utilise the experience of Lithuania, who has been gathering all the relevant DEVCO actors around one table for years.
Estonia could also prioritise areas for development cooperation as well as target countries depending on its existing capabilities—even more than it has done so far—in order to avoid putting any stakeholders under excessive pressure. After all, the biggest—and persistent—challenge for a small country is the lack of human resources. Therefore, joint efforts will yield better results, for example, if several small stakeholders apply for funding together instead of competing against each other. Likewise, on the international level, Baltic and Nordic countries could at times pull their resources to achieve better results.
In 2021, Estonia established a new Development Cooperation Agency (ESTDEV), a potent successor to the Eastern Partnership Centre. In addition to its coordination functions, ESTDEV can significantly contribute to promoting Estonia’s image as a DEVCO actor in order to appeal to more donors and project partners.
The money used by Estonian stakeholders comes not only from Estonia. The EU and wealthier donors are often willing to promote the Estonian know-how and skills by sponsoring relevant projects. The more we engage a wider network of donors and sources of funding, the more successful we can be. For example, Estonia’s cooperation with international organisations such as the United Nations Children’s Fund (UNICEF) in the field of education has helped to increase the impact of its projects, thereby proving to be a success story in and of itself.
Big Lessons from a Small State
Global actors could learn from Estonia, in particular, about how to carry out development cooperation more effectively and in a targeted manner while possessing limited resources. It is true that Estonian may not have been able to establish lasting democracy, solidify the rule of law, and foster a thriving market economy in any of the main target countries: i.e., Ukraine, Georgia, and Moldova. However, Estonia’s own transition experience has helped share knowledge more thoughtfully and effectively. This, in turn, has allowed for gradual changes for the better, for example, in reforming education or introducing information technology solutions for a more efficient public administration.
Hence, Estonia has primarily focused on teaching the lessons it has itself learned and providing solutions it has already tested. Unfortunately, one country’s success story cannot be directly transferred to another due to everyone’s unique circumstances. Estonia’s other strength lies in a deeper knowledge of the local conditions in target countries: it has been interacting with Georgians, Ukrainians, and Moldovans on different levels for decades. This interaction, moreover, has been devoid of the ‘superior-subordinate’ dynamics, a trap that many western nations have fallen into, especially in relations with their former colonies. Estonia’s experience thus proves that fostering mutual understanding and trust between partners is the best way forward.
One cannot help countries that cannot help themselves. Above all, the will to improve must come from within the country and be supported by its decision-makers. If political power is the goal in itself—rather than a means to achieve other goals—nothing will ever change. Under such circumstances, however, the most vulnerable and the underprivileged should become the priority for DEVCO. Following this logic, cooperation with civil society and/or diaspora is the only choice for Estonia to continue its engagement in cases where the regression of democracy has been obvious: formerly in Armenia, currently in Belarus, and recently in Georgia.
Beyond the State
Estonia has a vibrant and strong development cooperation community, in which the third sector, the private sector, and the state are all represented. The Development Cooperation Roundtable unites nearly 30 third-sector organisations that engage primarily with civil society in the target countries. For instance, vulnerable women and children are often assisted through such projects, while supporting free journalism and combating disinformation, too, take an important niche.
On the business side, Estonia’s flagship is, of course, information technology solutions provided to the public sector in target countries in cooperation with the Estonian government. In Estonia, the key to its many IT successes is public-private partnerships—something that might appear incomprehensible in many foreign countries. Elsewhere, intense competition around public services and solutions often emerges, which eventually results in only a single actor benefiting, instead of society as a whole. Estonia, meanwhile, has also tried to create new opportunities for its companies to export products and services via DEVCO. Such a trend is quite visible in Estonia’s contribution to the recovery and reconstruction efforts in Ukraine, where it also aims to serve as an example to other donors.
The second flagship of the Estonian DEVCO is education—the most reliable way to ensure systemic and long-term economic development and democracy promotion. Educated citizens make more informed political demands, while educated entrepreneurs create greater added value for society. For example, the Estonian project to reform the public education system in Georgia, carried out together with UNICEF, has reached quite extensive dimensions. Today, nearly two hundred schools in Georgia have introduced interactive teaching methods, following the Estonian example, which will produce better learning results compared to the Soviet-era education system.
Where to Next
Estonia has already taken some first steps to reach out to African countries as well, where its support consists mainly of promoting efficient information technology solutions. However, the lack of Estonia’s diplomatic presence on the continent—and, consequently, insufficient knowledge of the conditions on the ground—complicates effective and sustainable assistance, at times making it nearly impossible. Moreover, many African countries may require resources that are completely different from what Estonia can offer: e.g., road construction or financial support for the functioning of the local governments. Therefore, Estonia should keep its niche in ‘smart assistance’ (i.e., reform, IT, and education), prioritising countries where the basic conditions for growth already exist. Investments in infrastructure, on the other hand, require contributions of a completely different calibre and are widely available via international financial institutions and wealthier donors.
There are, however, other countries where Estonia’s transition experience might be relevant, such as in the Balkan region. The Ministry of Foreign Affairs, in cooperation with the Development Cooperation Council, is considering such opportunities in the ongoing review of the target countries under the development cooperation strategy. One idea being explored in this context is taking a region-based approach. It can also be further debated whether Estonia’s current humanitarian aid activities could be transformed into DEVCO projects in countries where Estonian humanitarian aid organisations are well-established and where the domestic developments are promising.
Estonia ranks last in the European Union in terms of its citizens’ awareness and support for development cooperation. It has been twenty-seven years since Estonia allocated its first development cooperation funds to Ukraine, yet the question of why Estonia needs to continue development cooperation remains relevant.
It goes without saying that the effectiveness of enhancing one’s own security by employing tools such as DEVCO cannot be measured by any metric. It is a axiom that a country is better protected and better off itself if it contributes—even a little bit—to the well-being of others. Estonia’s contribution to the democratic donors is Estonia’s DEVCO contributions amounted to roughly €100 million per year in 2023, while the US allocated $65 billion, Germany €38 billion, and EU institutions €27 billion for similar purposes. One could argue that 0.28% of a country’s GDP is a relatively small figure, but it is quite a significant additional investment in protecting Estonia’s independence, nonetheless.