Central Europe Review The International OSI Policy Fellowships (IPF) program
Vol 2, No 25
26 June 2000
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News from Estonia News from Estonia
All the important news
since 17 June 2000

Mel Huang

Politics and foreign affairs

The first class of the Baltic Defence College graduated this past week. The class of 32 is composed of students from Estonia, Latvia, Lithuania, Denmark, the United States, Hungary, Germany and Sweden. Defence ministers from Estonia, Hungary, Latvia, Lithuania and Sweden attended the ceremony in Tallinn, alongside Estonian President Lennart Meri, British First Sea Lord Admiral Michael Boyce and Danish military commander General Christian Hvidt. Hungarian Defence Minister János Szabó also discussed defence co-operation with officials. Next year, two classes of 40 will study at the BALTDEFCOL.

Estonian Prime Minister Mart Laar hosted his counterparts, Andris Bērziņš of Latvia and Andrius Kubilius of Lithuania, in the "summer capital" of Pärnu for a regular meeting. The trio focused on how to better exchange information, especially on issues relating to EU and NATO integration. The prime ministers also discussed Russia's and Lithuania's recent claim to damages from the Soviet occupation. Laar and Bērziņš, alongside several officials from both countries, opened a new border checkpoint at Ikla before the trilateral summit.

Foreign ministers from the Council of Baltic Sea States (CBSS) met in Bergen, Norway, to discuss regional co-operation. High on the agenda was the EU's "Northern Dimension" and the integration of Kaliningrad into the region. The Council also approved a change to the mandate of the human rights commissioner, changing the role to that of a democratic development commissioner. Former commissioner Ole Espersen is completing his term. He will be replaced by the chairwoman of the Foreign Affairs Committee of Denmark's Folketing, Helle Degn. The members of the CBSS are Denmark, Estonia, Finland, Germany, Iceland, Latvia, Lithuania, Norway, Poland, Russia and Sweden, while the US, Britain, France, Ukraine and the European Commission are observers.

The visit by the parliamentary state secretary of the German Defence Ministry turned into headline news, when Walter Kolbow suggested that Russia's "consent" would be needed in NATO enlargement. This set off alarming reactions in some candidate states already weary of the German attitude towards NATO and Russia (see this week's Amber Coast for more).

The Riigikogu passed a tough new tobacco law, which some called draconian, on the first day of its extra session. The law places restrictions on the content of cigarettes and other tobacco products and places severe restrictions on where smoking is allowed. Smoking will be banned from many places, ranging from waiting rooms in train stations to government buildings, where smoking rooms will need to be designated.

The same busy day, the Riigikogu approved two loans from international lending institutions for transport. A EUR 15 million loan will be used to improve both the Tallinn-Pärnu-Ikla-(Latvia) route and the Tallinn-Narva-(Russia) road, while a EUR 24.8 million loan will be used for the Tallinn-Tartu-Luhamaa-(Russia) route.

Other resolutions passed in this busy Riigikogu session included a tax on fuel components and additives, a one-year extension for troop deployment in Bosnia, approval of the central bank's 1999 report and the placing of IT issues in the domain of the Transport and Communications Ministry.

However, the second day of the special Riigikogu session collapsed with a lack of quorum on a key bill on rural life. With only 49 members present, the opposition, vehemently against the bill, made a surprising quorum call that caught the ruling coalition off guard, citing rules that require extra sessions to have a quorum of at least 51 members. Prime Minister Laar issued a warning, saying without the bill Estonian farmers may lose up to EEK (Estonian kroons) 250 million worth of EU SAPARD funding. This comes coincidentally as the EU ruled to increase the quota of Estonian products and reduce the tariffs on others, while scaling back subsidies to producers that export to Estonia.

The Tallinn City Council voted to sell 50.4 per cent of water utility Tallinna Vesi. This comes as the Council also approved a EEK 186.8 million supplemental budget for roadwork and IT development, with about half the funds due to come from the water privatisation. The remaining will be from loans.

Travelling to Estonia soon? Choose Hotels Central at HotelsEstonia.com to reserve a hotel online at a great price.

The Baltic Russian Party of Estonia was officially formed. Leader and MP Sergei Ivanov stressed the party will be Esto-centric but also will be concerned with issues affecting the Russian-speaking population. Ivanov, who is close to the ruling coalition, nevertheless called for simplified citizenship and language laws. Other Russian parties are now talking of a merger to counter this new force, which prompted a strange message of reconciliation issued by the Russian Embassy, who said they cannot help if the forces are divided.

Curiously enough, the Riigikogu voted to raise the minimum tax-free monthly earning to EEK 1000, on an initiative of the laissez-faire-minded Reform Party. Previously, it was EEK 800, raised just recently from EEK 600.

The post of legal chancellor is empty, as Eerik-Juhan Truuväli completed his seven-year term. No replacement has been named yet, due to haggling among politicians, so a deputy will act as legal chancellor until a new appointment is made.

The broadcasting council named former banker Aare Urm as the head of public television ETV and kept Ain Saarna as the head of Eesti Raadio. Local media complained of collusion between the government and opposition in making the deal, as one candidate is supported heavily by the Pro Patria Union of Prime Minister Laar and the other by the opposition Centre Party.

Estonia's sixth honorary consulate in Sweden opened in Karlskrona, headed by Lars Werner. Other honorary consulates in Sweden are in Gävle, Luleå, Eskilstuna, Malmö and Visby, on the island of Gotland.

Ambassador Mart Laanemäe presented his credentials to Swiss President Adolf Ogi. Laanemäe, residing in Vienna, is ambassador to most of Central Europe for Estonia, and seems to get more and more appointments over the years.

President Meri approved Rein Oidekivi as the new ambassador to Lithuania, recalling current Ambassador Alar Olljum in the process, as he approaches the end of his term. Ambassador to Japan Mark Sinisoo and Ambassador to Poland Peeter Reštšinski have also finished their terms and were recalled, but replacements have not been officially named yet.


Economics and business

The Estonian government issued what amounts to an ultimatum to US-based NRG Energy for the privatisation of the country's two main power plants. The final set of conditions, according to Economics Minister Mihkel Pärnoja, is far from being negotiable, and the government expects an answer by this Monday. The deal, which was progressing well after five years of talks, hit snags recently, as President Lennart Meri came out suddenly against the deal, and several "consultants" also disagreed with the terms. The US government is believed to be strongly in support of the deal, and its demise could jeopardise US-Estonia relations.

The central bank announced that the Q1 current account deficit is at eight per cent of anticipated GDP, at about EEK 1.5 billion. The bank also said Q1 trade deficit was EEK 2.5 billion, but that included a jump in exports by 47 per cent and imports by 38 per cent. With all the numbers, the central bank also upped the GDP forecast to 5.5 per cent this year.

The producer price index rose by 0.2 per cent in May compared to April.


Social and local interest

In a highly controversial report, the World Health Organisation (WHO) ranked Estonia's health care system 77th in the world. Many countries, including Britain, have complained of the methods used by the WHO in critiquing the state of health care in the world. Latvia was ranked 105th and Lithuania ranked 73rd.

A person accused of making a string of bogus bomb threats to one store in the Pirita suburb of Tallinn has been apprehended by CCTV. The store, which faced nearly one threat per day, was more than relieved by the apprehension.


And in other news...

It's summer, and strange contests are about. A contest in Tartu to see how quickly people can drink beer yielded a victor who put down 3.5 litres of beer in one minute, winning EEK 5000.

Estonia and Finland held a joint song and dance festival, with the song festival held at Tallinn's Song Festival grounds and the dance festival at Helsinki's Olympic Stadium. Some 10,000 singers (3800 from Finland) raised their voices in Tallinn, while 6000 (3500 from Estonia) danced away the next day, 85 kilometres north. Although ticket sales were less than expected, and the whole project was a financial loss, Presidents Lennart Meri of Estonia and Tarja Halonen of Finland surely enjoyed the event from the grandstand.

Happy birthday! The Estonian currency, the kroon, celebrated its eighth birthday on 20 June. At the time of introduction - backed by assets stored away by Estonia before World War II - analysts called it crazy, Estonia being the first country in the post-Soviet vacuum to introduce its own currency. Pegged then at DEM (German mark) eight to EEK one, it has not shifted since.

Exchange Rates
As of 23 June 2000
Currency Estonian
1 US dollar 16.69
1 British pound 25.17
1 German mark 8.00
1 euro 15.65

[Up-to-date exchange rates]

Mel Huang, 23 June 2000

Moving on:


Baltic News Service (BNS)
The Baltic Times
Radio Free Europe/Radio Liberty
Reuters news on Yahoo
Eesti Päevaleht



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The Arts:
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