But Estonia slid into recession in 2008 as rampant inflation dented domestic consumption.
The global economic crisis compounded the bleak picture by hitting exports — as well as the tourist trade, as many would-be foreign visitors stay at home.
The economy contracted by an estimated 2.8 percent in 2008. Authorities expect it to shrink by 4.5 percent this year, although analysts say it may plunge by as much as 7.0 percent.
Dozens of hotels built in the picturesque capital Tallinn during the boom are now struggling and are slashing costs by firing staff, closing for the winter and offering hefty discounts via their websites.
One of Tallinn’s newest hotels is trying to draw visitors by offering free unlimited international calls via the Skype Internet service, which has more than 370 million users worldwide.
[Feliks Magus, chairman of the Estonian Hotel and Restaurant Association] said other hotels were following suit.
