New cold record in Estonia

The weather station of Jõgeva in eastern Estonia measured the country’s new cold record for this winter at minus 31.5 degrees Celsius in the early hours of Saturday. The record was measured between 5 and 6 a.m., said Miina Krabbi, departmental head at the Estonian Institute of Meteorology and Hydrology.
The previous record for this winter was measured on 2 January also in Jõgeva, when the thermometer reading was 29.5 degrees below zero.
Temperatures colder than that have been recorded in recent years at Tiirikoja on 20 January 2006 – 32 degrees, and in Jõgeva on 11 January 2003 – 36.7 degrees. Jõgeva also boasts Estonia’s absolute cold record – minus 43.5 degrees – measured on 17 January 1940.
Estonia on Friday saw the highest electricity consumption of so far this winter as its average consumption hit 1 511.3 megawatts at the peak consumption hour between 5 and 6 p.m., the transmission grid company Elering said.
Air temperatures at the time were close to minus 20 degrees in most of mainland Estonia and even lower in some places.

Source: Estonian Review

Population decline smallest in recent years

The size of the population of Estonia decreased by about 400 people as a result of negative natural growth in 2009, marking the smallest annual drop since 1992, Statistics Estonia said on Friday.
The population decline slowed down last year as a result of a smaller number of deaths. However, the number of live births decreased for the first time during the last eight years.
During the year, 15 807 live births were registered in Estonia, 221 fewer than in 2008. The number of deaths was 16 201, which is about 500 fewer than in the preceding year.
By a preliminary estimate of Statistics Estonia, the country’s population numbered 1 340 000 as on 1 January 2010. The natural increase of population in Estonia has been negative since 1991.
In 2009, 5 409 marriages were contracted and 3 193 marriages were divorced, which is respectively 718 and 308 less than in the year before.

Source: Estonian Review

Tallinn among top 7 intelligent communities

The Intelligent Community Forum’s evaluation committee chose Tallinn as one of the seven most intelligent communities in the world for the fourth time.
“This is a very big accomplishment—not a single other community has been able to remain among the top seven for so long,” said Mayor of Tallinn Edgar Savisaar.
Tallinn shares the title of Top Seven Intelligent Communities of the Year 2010 with Arlington County, Virginia and the city of Dublin, Ohio in the USA, the city of Dundee in Scotland, the city of Eindhoven in the Netherlands, the city of Ottawa in Canada, and the city of Suwon in South Korea.
Of the seven in the finals, the most intelligent will be chosen in May. Last year this honour was given to Stockholm, Sweden.

Source: Estonian Review

Euro is the result of responsible budgetary policy

According to the updated convergence programme approved by the Government today, Estonia will be ready to introduce the euro in the beginning of 2011. The economic forecast on which the programme is based shows that economic decline will stop this year and inflation will remain on the level of 0.4 percent.
 
Minister of Finance Jürgen Ligi says that as of today, Estonia will meet all the criteria for transferring to the euro. “We met the inflation criterion in November. We believe that Government’s decisions and efficient collection of revenues in 2009 will allow us to meet the budget criterion with a small safety margin. We will continue to improve our budgetary position in following years,” said Minister Ligi.
 
The growth expectations of Estonia’s export partners, improvement of certainty on the domestic market and the possibility of introducing the euro have strengthened growth expectations. Economic decline will stop in 2010 and we are expecting economic growth to recover to the level of 3.3 percent in 2011.
 
There should be no significant price increases in 2010 and the consumer price increase will remain around 0.4 percent. Inflation in the next few years will remain between 1-2 percent.
 
According to our estimations, the general government budget deficit amounted to 2.6 percent of GDP in 2009 and is expected to remain on the level of 2.2 percent of GDP in 2010. Statistics Estonia will publish preliminary data on general government deficit and debt of 2009 on 26th of March.
 
“Even if the deficit is small, we should not put up with it for long and we therefore want to reach a budget surplus by 2013. In addition to economic growth, this also requires strong expenditure control and structural changes,” added Jürgen Ligi.
 
The objective of the Convergence Programme is to report the policy of the government of a non-eurozone EU country in meeting the Maastricht convergence criteria and introducing the single currency. Assessment of the Member States’ programmes by the European Commission and Council will take place from February to April and the report prepared as a result of the assessment will be published in May.

Additional materials: Estonian Updated Convergence Programme 2010 brief introduction and full text.

Source: Estonian Ministry of Finance

Estonians set record for going to movies in 2009

With almost 1.8 million tickets sold during the year, Estonia in 2009 recorded a bigger number of movie visits than in any other year since regaining its independence, the daily Postimees said.
The 1 783 651 tickets sold means 1.33 visits per resident, one of the highest such ratios in eastern Europe, and box office revenue totalled 117 772 792 kroons (7.5 million EUR).
During the year 307 films were screened via the distribution network, of them 161 new and 146 old.
The average price of a movie ticket last year was 66 kroons (EUR 4.22), four kroons less than a year ago.
The newspaper observed that also several other European countries, such as Spain, France and Poland, reported about a record or near record year in terms of movie audiences, and especially box office figures, in 2009.
There were five 3D productions among the ten most viewed films in Estonia in 2009. These, in addition to the popular Avatar, are four children’s or family animated films: “Ice Age 3”, “Bolt”, “Up”, and “Cloudy With a Chance of Meatballs”.
The newspaper points out that Estonian films — four fiction films and three documentaries — got 27 679 visits. This equals a market share of 2.03%, and 1.63% if films in secondary distribution are excluded. By box office revenues the market share of Estonian films was 1.59%.

Source: Estonian Review

Estonia’s 3 key advantages

the Minister of Economic Affairs and Communications of the Republic of EstoniaSpeech of Juhan Parts, the Minister of Economic Affairs and Communications of the Republic of Estonia, at the Investment conference 29.01.2010

It is a great pleasure to deliver this opening speech at this investment conference with such an inspiring name. Rise and shine Estonia! The title of my presentation today was suggested to be about what Estonian government is doing for the economy to recover. True, there is no other priority for the government than to do its utmost in order to help Estonian economy to get back to its growth track again. Especially for the minister of economic affairs, this is the question, the challenge that has been guiding my work.

Of course, there is something I’d like to be clear about from the beginning. Everybody is looking towards the government during tough times and this is justified by any means. Government has many instruments that can be used for reigniting the economy and bringing it out from the crisis. However, I must stress that it is not government who can create new competitive jobs, it is not government who can increase exports and it is not government who can start-up new fast growing companies. This was a different system at a different time when everything was done only by the government. We need entrepreneurs, free markets and innovative spirit to really overcome these challenges!

Still, even if I admit that government cannot directly tackle the current challenges I am not saying that government should stay passive. We have not been passive in Estonia! Bad government can be a disaster to the economy, so there is a definite need for leadership and vision from the government. The first and the foremost responsibility for the government is to make sure that businesses can enjoy a competitive environment, which is nurturing their abilities and making it possible to become more competitive, to grow and to create new quality jobs.
Government needs to understand the needs of companies and be flexible enough to react to the changing environment by adjusting its policies according to the new needs. In contrast, there are also things (like taxes) where we need to be conservative and if something needs to be changed, the decisions need to be based on quality studies and calculations.
 

WHAT ARE ESTONIAN ADVANTAGES?

I would like to bring out three key policy directions where Estonian government has been working hard and which will contribute towards the increasing competitiveness of our economy.

1) Estonia has kept public finances in order even during most difficult times.

I am talking about public finances but it also means euro accession. Yes, I have no doubts that Estonia is going to join euro-zone in 2011. We will be the only country in European Union that can meet Maastricht criteria and refrain from excessive budget deficits. Euro is important but as everybody here today also understand; it is not a silver bullet that will erase all our worries. Nevertheless, euro is a symbol that demonstrates our control over public finances and overall efficiency of the administration that could win this challenge during the most difficult times.
Joining euro-zone will be a major factor influencing the investment climate in the post-crisis Estonia.

First of all it will provide credibility. Not only credibility about the currency risk (which is also important)or credibility about being able to repay our debts (which translates into interest rates on loans available to companies).

The credibility is also about the business climate and the tax environment. Estonia is the country in Euopean Union with the lowest level of public debt. We are keeping our running budget deficits under 3% of GDP, thus avoiding the trap where governments need to increase revenues after the crisis in order to repay all the loans they took in order to revitalize their economy. Everybody in Europe is today thinking about exit strategies, fiscal consolidation and about the need to adapt to the new realities. We have already taken the most painful decision for adaptation! We can repay our loans easily and there is no need to increase taxes to do that. The confidence it gives to the companies is the fact that Estonia does not need to increase the overall tax burden as a part of the exit strategy. No! Instead of that we are thinking how to make our taxation system more attractive for investments. Estonia has been a tax innovator in the past and I believe that we can also move forward in increasing its attractiveness even in the future.

2) Estonia is not an average Eastern European country – and this is increasingly understood among foreign investors.

What is “Eastern Europe?” I can completely agree with a recent article in the journal “Economist” where it was concluded that Eastern Europe as such is only a myth. This is a region that is often labeled so because of the unfortunate common experience during the second half of 20th century and because of these countries used to be” in transition” – politically and economically. I argue that this construction is no more valid today.
This is a personal example why I think so. Bit more than a year ago, at the end of 2008, I made a presentation at an investment fair in Germany. The focus of the event was on investments into Eastern Europe and Russia. German businessmen who spoke after me gave overview about their experiences in “Eastern Europe” – countries where there is rampant corruption, where you have to bribe officials to be able to get licenses and permits. Countries that are attractive because of their cheap labor but unattractive because of the old-fashioned administration and overburdening red tape.

I felt completely out of the place. The experiences these businessmen were talking about were all real but they had nothing to do with Estonia. We have one of the most transparent administrations in Europe if not in the world. According to international rankings there is next to no corruption. This is a country where you don’t even need to leave your office when you want to communicate with governmental institutions – e-government solutions are highly developed. Taxes are declared online in the matter of minutes and tax returns administrated in the matter of days. The business culture is getting closer to Scandinavian countries. The rule of law in Estonia is very strong and laws apply to everybody with the equal strength. These are very basic things and we don’t usually think about them that much but these are also things that set us apart from other countries with similar background.

Joining euro-zone will have a role to play in here as well. By joining euro we are showing that Estonia is able to handle our things independently, we are efficient and our past policies are paying off. When the crisis started it was impossible to convince anybody about the fact that a region should not looked upon as a uniform entity but now we are increasingly receiving international recognition that Estonia has been successful with our response to the crisis and our policies are laying ground for the future competitiveness. Euro is fostering this perception even more.

3) Estonia has great infrastructure and we need to keep improving it!

What do I mean under “infrastructure”? Not only roads and communications but I am thinking about infrastructure in a broader meaning. Infrastructure for education, infrastructure for social protection and infrastructure for transportation.

I believe that the best thing government can do and where it must be active, is in developing infrastructure for future development. In here we have done quite a bit. What kind of projects do we have?

First education. Estonia’s position in education is not bad at all. In PISA study from 2006 Estonia ranked 5th in sciences – meaning that the general level of Estonian education is not bad. Of course this is the level of secondary education, and the picture is a bit different when we look at the options young people have after graduating secondary school. Estonian vocational schools need more attention and we need some consolidation in the higher education –so that Estonian universities could make it to the global rankings. Today we are not there yet.

What I am proud of is the fact that regardless of the time of crisis, Estonia has been able to maintain the planned level of investment into R&D and innovation. If today Sweden and Finland are spending more than 4% of their GDP on R&D, then the number for Estonia is around 1,5%. To give us credit, this number has been increasing steadily over the last years and is projected to do so as R&D financing is planned on a long-term basis and doesn’t depend so much on economic fluctuations. R&D and education will remain among the priorities.

Good education and functional innovation system provides us with many innovative ideas for new products and services. I think that we don’t need to be ashamed about the level in Estonia here –Skype, a 3D camera that was developed in Estonia, even this cheese that is good for the health of peoples’ heart. There are many ideas but today the most successful ones have been the ones where the leadership in commercialization has been taken by foreign competence. In Estonia there is lack of finance, lack of available risk capital. In order for entrepreneurs not to give up their ideas we need to work on this kind of financial infrastructure as well. This is also part of education, part of R&D.

Transportation. We have brought forward some key investments in transportation infrastructure. The availability of transport connections forms a very basic layer in the general competitiveness of a country. In case of Estonia I means improving our road network, leveling up border crossings and also putting more emphasis on air connections. I know that there is a lot of room for improvements there – and we are working to find solutions.

Today it is important also to focus on transporting information, large quantities of information. Government initiated and will implement with the private sector the “EstWin” project – enabling Estonia to be covered with broadband connection as early as by 2012. Fast internet will provide excellent infrastructure for different ICT market solutions.

Government will continue investing in energy infrastructure. Some huge investments are needed and decisions need to taken. The extra capital is needed for investments in Eesti Energia and government is currently working on different options. There will also be investments for improving the connectivity with Scandinavian countries, investments into renewable energy.
The government has also worked on the labor market – there is a new labor contract law from the middle of last year – providing more flexibility for the companies while still looking after the interests of job-takers. The arenas where this investment infrastructure can and should be improved by government are plentiful but we won’t get tired.

Estonian economy can start to recover only if Estonian companies start investing more. Only if there will be more foreign direct investments coming into the economy. New investments mean that new jobs will be created, production upgraded, new markets discovered.

Estonia has some real advantages compared with Scandinavian countries, compared with the UK. Starting from the open and transparent business climate and not forgetting our skilled labor pool with reasonable wage demands.

I believe that globalization is far from being dead and protectionism is definitely the way how to find solutions to the current challenges. Governments need to take lead in making sure that the business climate is entrepreneur-friendly and to keep developing infrastructure, necessary for successful businesses. Estonia has all the necessary preconditions for rising up and shining once again –but this time not because of loan-fueled consumption boom but because of some real innovation based development.

Source: Estonian Ministry of Economic Affairs and Communications

Six countries to follow Estonian litter cleanup example in 2010

A successful nationwide litter cleanup effort in Estonia in 2008, during which volunteers collected close to 10 000 tons of garbage dumped in forests and by the roadside, has inspired at least six countries to follow the example, the daily Postimees says.
Inspired by the Teeme ära 2008 (Let’s Do It 2008) campaign, Portugal, Romania, Slovenia, India, Latvia and Lithuania are planning similar campaigns this year.
Latvia organised the first cleanup effort in September 2008 and again last year. “The aim is to make Latvia and the Baltic region the cleanest place on the world map within 10 years,” organiser Vita Jaunzeme said.
This weekend an international conference will take place in Tallinn in which new countries joining the campaign as well as Latvia and Lithuania will participate to share experiences and compile a virtual handbook for the many other countries grappling with litter problems.
The conference falls on the same day as the first cleanup event in the Indian capital New Delhi.

Source: Estonian Review

Gulf of Riga and Pärnu Bay fully frozen

The Estonian Maritime Administration said that the whole Gulf of Riga and Pänu Bay are covered with ice. From Irbe Strait to Ruhnu Island the ice is 10-15 cm thick, and from Ruhnu to Kihnu Island and further to Pärnu Port it is 25-50 centimeters thick, Martin Kaarjärv, head of the wintertime navigation service at the Maritime Administration, told BNS.
The multifunctional ship EVA-316 is currently breaking ice on the Gulf of Riga.
On the Gulf of Finland the ice-bound area is expected to move west if such cold continues and the thickness of ice steadily increases.
Kaarjärv said that if necessary, the icebreaker Tarmo would help ships from the ports of Paldiski Bay get to to Sillamäe Port. At present the Tarmo is east of Aksi Island waiting for a ship that needs help in arriving at Kunda to leave Muuga Port.
An additional icebreaker will be chartered into the Gulf of Finland in case of need, but at present, Kaarjärv said, the country could manage with its own resources.

Source: Estonian Review

Exports of mineral products and wood increased

According to Statistics Estonia, in November 2009 exports of goods from Estonia at current prices totalled 9.1 billion kroons and imports to Estonia amounted to 10.3 billion kroons. Compared to November 2008, total exports declined by 8% but exports of mineral products (incl. petroleum products) and of wood and products thereof increased.

In November the total exports of goods from Estonia decreased 8% (0.8 billion kroons) and the total imports 21% (2.7 billion kroons) compared to the same month of 2008. The decrease in both exports and imports slowed down because the comparative base in November 2008 was lower than in the preceding months mainly caused by the worldwide economic and financial crisis. The trade deficit of Estonia amounted to 1.2 billion kroons (3 billion kroons in November 2008).

In November 2009, in exports the biggest share was held by mineral products (18% of total exports). Exports of mineral products increased 46% or 0.5 billion kroons compared to November 2008. Exports of goods related to wood (incl. wood and products thereof, paper, furniture) also increased. The main countries of destination for wood and products thereof were Finland, Sweden and Denmark.

In imports to Estonia the biggest share was held by two commodity sections, mineral products and machinery and equipment. Both commodity sections accounted for a fifth of the total imports of Estonia. Compared to November 2008, the biggest decrease was mentioned in the arrivals of machinery and equipment (by 0.9 billion kroons). Imports of plastic and rubber products and of wood and products thereof slightly increased.

In November, the main countries of destination from Estonia were Finland (19% of the total exports), Sweden (12%) and Russia (10%). Exports to Sweden and Russia declined the most (both by 0.3 billion kroons).

The main countries from where goods were imported to Estonia in November 2009 were Finland (15% of the total imports), Lithuania (14%) and Latvia (12%). Imports of goods from Russia declined significantly (by 0.7 billion kroons). But imports from Lithuania increased by 0.4 billion kroons.

Compared to October 2009, exports of goods from Estonia increased 1% and imports 5%.

Estonia’s foreign trade, January–November, 2008–2009
Month Exports, mEEK Imports, mEEK Balance, mEEK
2008 2009 %   2008 2009 % 2008 2009
January 10 154 7 267 -28 13 725 8 798 -36 -3 571 -1 531
February 10 677 7 818 -27 13 641 8 719 -36 -2 964 -901
March 10 647 8 347 -22 14 145 9 735 -31 -3 498 -1 388
April 12 332 7 740 -37 15 916 9 284 -42 -3 584 -1 544
May 11 549 8 166 -29 14 507 8 465 -42 -2 958 -299
June 10 862 9 557 -12 14 140 9 903 -30 -3 278 -346
July 10 969 8 243 -25 15 047 9 451 -37 -4 078 -1 208
August 11 142 8 126 -27 13 420 9 299 -31 -2 278 -1 173
September 12 300 9 441 -23 15 195 10 136 -33 -2 895 -695
October 13 249 8 955 -32 15 656 9 755 -38 -2 407 -800
November 9 897 9 061 -8 12 929 10 265 -21 -3 032 -1 204
Total 123 778 92 721 -25 158 321 103 810 -34 -34 543 -11 089

 See more here from Statistics Estonia website

Estonia sending 27 athletes to Vancouver Olympics

Estonia will send 27 athletes to the Winter Olympics in Vancouver, its biggest ever lineup for a winter Olympics.
The executive of the Estonian Olympic Committee (EOC) on Friday endorsed the country’s Olympic delegation made up of 27 competitors and 33 coaches and other support staff.
The athletes include 11 cross-country skiers, nine biathletes, five figure skaters and two alpine skiers.
The executive endorsed the Olympic delegation unanimously, EOC President Mart Siimann told reporters.
This is the largest number of athletes Estonia has ever sent to a winter Olympics. The country sent 26 competitors to the Turin games in 2006 and 18 to Salt Lake City in 2002.

Source: Estonian Review

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