Estonia is a country known for its digital way of life, and its latest program that is likely to make it the first “cloud country” is another feather on its cap. If you’re wondering where in the world is Estonia, well, it’s a small country in the Baltic region of North Europe.
Looking back a few decades, Estonia got its independence from the from USSR in 1991. Since then, it began pushing into the digital world in a big way. For example, it created an online voting system in 2007 to make it easy for its residents to vote from any part of the world. Other programs include providing government services online, including medical records and prescriptions, so almost what everyone wants can be accessed online.
To take this digital adoption to the next level, Estonia has established something called e-residency. Under this program, people from any part of the world can apply to become virtual residents of this country. Once approved, they can start business, run a company or do anything else that other residents Estonians can do.
This program has attracted thousands of people world over. Why? For its simplicity.
Any person who wants to become a virtual resident has to fill an application form online, upload a copy of passport and pay a fee of 100 Euros. It takes four weeks for the application to be processed and during this time, a background check including a police verification is done. After the application is approved, the applicant has to visit a check point, usually the nearest Estonian embassy, and collect a digital certificate with a digital identity. Each approved applicant is given a smart card and an email ID, using which they can open bank accounts or start a company. However, most banks insist that the applicant should visit the branch in person to open the account.
So far, more than 17000 people have used this program. Bulk of the applications have come from countries like Finland, Russia, the USA, and of late, the UK. This attraction is mainly because Estonia has no corporate tax on the balances left within the company. Since this tax advantage is not available in most countries, people are looking to make the most of this opportunity and setup a business here.
With such a residency model, Estonia has created what is called a “cloud country”, akin to cloud computing. This was probably a natural extension for a country like Estonia – a place that combines a digital economy with a fairly stagnant population and economy. To give you a perspective, Estonia ahs about 1.3 million residents and a GDP of $23 billion, which is less than 10% of Apple Inc’s company value. With such a program, Estonia aims to boost its population as well as its economy in a big way, and this strategy is paying off as well.
Also, this idea of a “cloud country” is unique simply because it erases the physical boundaries of a country, which is true in the world of cloud storage and computing. This step can be the first major change that can bring us together in a “cloud world.”
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