Martin Simovart, Partner and Head of Global Relations at Cobalt in Estonia, is fairly confident about the state of affairs in his country at the moment. “For the first half of the year we saw what we actually predicted — about a five percent rise in GDP — and I hope it’s going to continue. The momentum is there, and I don’t see any indicators that it’s going to slow down. And the overall feeling is fairly positive.”
Simovart, speaking from Sydney, Australia, concedes that Estonia’s prospects aren't completely in its own hands. “Of course we’re such a small country that we’re dependent on outside factors — how Scandinavia is doing, things in Russia, and so on. These are unpredictable, and we can’t control them.” Still, he says, "if circumstances continue as they are things should continue to go well."
And they’re certainly going well for Cobalt in Estonia, he says, “We don’t have final figures for this financial year yet, but unofficially we see an increase of 10-12% over last year, with some big transactions ongoing and new projects continuing to come in. M&A transactions and litigation and regulatory part all very active.” Simovart says that the GDPR has “absolutely” been good for business, "and we’ve done a lot of it.”
Estonia’s reputation as a home of innovation remains a source of growth. "Start-ups remain very strong in Estonia,” Simovart says, "both in strategic equity funds and venture capital funds, including from Chinese investors. This sector has been really active and continues to be, and transactions happen frequently.” Indeed, he says, "Things in this sector have been even better than last year — which was better than the year before it.”
By contrast, although Real Estate has been a real engine for growth in many CEE markets recently, Simovart says it’s been less strong in Estonia. "Real Estate is not going down,” he says, “but it may be going sideways. It’s not going dramatically up. But I guess we’ve reached the pre-crisis level for both houses and commercial real estate. So there’s an increase over previous years … but it’s not exploding."
Simovart says that the ongoing transformation of the Estonian legal market seems to be settling down. "I think the legal market has been very demanding for the past two years, though now it’s settled down, compared to what it was a few years ago when all the mergers and consolidations happened. Now it’s fairly stable. There are essentially three leading firms — Sorainen, Ellex, and Cobalt — and there are some spin-offs and firms that have found more of a niche practice. In this sense the market has settled down and become more mature as well."
Of course, the growing sophistication of the markets makes the competition for skilled lawyers more acute. Especially, Simovart reports, because “young lawyers are more ambitious, and the demands from mlllenials for work space and work-life balance when they pursue their careers mean that law firms have to adapt.”