Estonia established diplomatic relations with Côte d’Ivoire

Estonian Ambassador to the UN Margus Kolga and Ambassador of Côte d’Ivoire Youssouf Bamba established diplomatic relations between Estonia and Côte d’Ivoire in New York on Friday, 8 June.

In their conversation following the establishment of diplomatic relations, the ambassadors discussed opportunities for developing bilateral relations. Ambassador Kolga noted that Estonia is interested in naming an honorary consul in Côte d’Ivoire. “If Côte d’Ivoire would like to appoint an honorary consul in Estonia, we would be prepared to help in any way we can,” he added.

Estonian Ambassador Kolga expressed hope that by establishing diplomatic relations, economic and cultural co-operation between the countries will develop as well. Other topics covered during their meeting included Estonia’s experiences in the information technology sector and UN Security Council reform.

Côte d’Ivoire (Ivory Coast) is located in West Africa and is bordered by Liberia and Guinea to the west, Mali and Burkina Faso to the north, Ghana to the east and the Gulf of Guinea to the south. The country covers 322 463 square kilometres and is home to over 21 million people. The capital of Côte d’Ivoire is Yamoussoukro. The country gained its independence from France in 1960.

Source: Estonian Review

European Commission: Estonia has only partly complied with our recommendations

The European Commission finds in its assessment report published on Wednesday that Estonia had only partially complied with concrete recommendations that were issued to EU countries for better co-ordinating their economic policies.  Estonia received a total of four recommendations last year from the Commission.

In terms of the State budget, Estonia has strayed from the course of keeping the budgetary deficit at the level of 2.1% of GDP in 2012. Instead, the European Commission predicts that the country’s deficit will be 2.6% of GDP. 

The same was the Commission’s assessment on the labour market policies. The Government of Estonia has taken a number of steps to lower labour taxes, but there are shortcomings in active labour market policy.

In energy policy, Estonia has failed to stimulate individuals to prefer public transport to personal vehicles and the trend in Estonia tends to go the other way.

In the field of education, the Commission admitted that the quality and accessibility of vocational education has improved and the number of people involved in life-long learning is growing as well, but not enough attention has been paid to low-qualified workers.

In its recommendations to Estonia, the European Commission proposes that Estonia continue with the administrative reform in order to guarantee better access to public services on the local level. It was noted that currently, local governments have difficulties in guaranteeing social welfare, healthcare and education services to all of their residents; they appear to be too small in order to meet the obligations set upon them by law.

Read more from BBN

Read also: Country-specific Recommendations 2012-2013

Regulated prices have risen by 9.6 pct compared to last year

According to Statistics Estonia, the change of the consumer price index was -0.1% in May 2012 compared to April and 3.8% compared to May of the previous year.

Goods were 2.9% and services 5.5% more expensive compared to May 2011.

Regulated prices of goods and services have risen by 9.6% and non-regulated prices by 1.9% compared to May of the previous year.

Compared to May 2011, the index was mainly influenced by housing expenditures which gave almost a half of the total increase. Of which in turn over 40% gave 15.6% more expensive heat energy. Motor fuel was 9.5% more expensive and gave less than a seventh of the total increase. Compared to May of the previous year, of food products, the prices of eggs have increased the most (51%) and the prices of potatoes have decreased the most (63%).

The change of the consumer price index compared to the same month of the previous year was below 4% last in December 2011, when it was 3.7%.

In May compared to April, the consumer price index was mainly influenced by the 5.2% price decrease of motor fuel, which covered smaller price increases in other commodity groups. The bigger changes occurred in the prices of cucumbers (down 46%) and Chinese cabbage (up 35%).

Change of the consumer price index by commodity groups, May 2012
Commodity group May 2011 –
May 2012, %
April 2012 –
May 2012, %
TOTAL 3.8 -0.1
Food and non-alcoholic beverages 1.9 0.3
Alcoholic beverages and tobacco 6.2 0.4
Clothing and footwear 6.3 1.3
Housing 10.3 0.5
Household goods 3.6 0.4
Health -0.8 -0.3
Transport 3.8 -2.3
Communications -7.8 -0.1
Recreation and culture 0.6 -0.1
Education 5.9 0.0
Hotels, cafés and restaurants 5.5 2.0
Miscellaneous goods and services 3.6 -0.4
 
Source: Statistics Estonia

Trade decreased in April

According to Statistics Estonia, in April 2012, exports of goods from Estonia decreased by 7% and imports to Estonia by 4% at current prices compared to April of the previous year. Compared to the same month of the previous year, exports decreased already for the second month in succession, which is also influenced by the high comparison basis last year. Trade decreased also compared to March.

In April 2012, exports from Estonia amounted to 1 billion euros and imports to Estonia to 1.1 billion euros at current prices. The trade deficit was 97 million euros and it slightly increased compared to April 2011.

In monthly basis or compared to the previous month, exports and imports increased during the first months of the year, but in April compared to March exports decreased by 5% and imports by 7%. The decrease in exports turnover was mainly influenced by the decrease in the dispatches of machinery and equipment, and imports turnover by the decrease in the arrivals of mineral fuels.

In Estonia’s exports in April, the biggest share was held by machinery and equipment (28% of Estonia’s total exports), followed by mineral fuels (incl. motor spirits, shale oils and electricity) (17%) and metals and products thereof (10%). The decrease in exports compared to April 2011 was mainly influenced by the decrease in the dispatches of fuels and machinery and equipment (down by 33% and 5%, respectively). The slight increase was mentioned in the dispatches of the raw materials and products of chemical industry (the growth rate 20%).

In April the biggest share of Estonia’s imports was held by machinery and equipment (26% of Estonia’s total imports), followed by mineral fuels (15%) and transport equipment (12%). The decrease in total imports compared to the previous year, was mostly influenced by a decrease in the arrivals of mineral fuels (down by 47%). Only the arrivals of transport equipment increased significantly (by 52%).

The top destination countries of Estonia’s exports were Finland (15% of Estonia’s total exports), followed by Sweden (14%) and Russia (11%). Compared to April 2011, the decrease in total exports was mostly influenced by the decrease in the dispatches to Sweden and the USA (down by 29% and 47%, respectively). Exports to Russia increased by 21%. Electrical equipment, wood and products of wood and furniture were the main commodities exported to Finland and Sweden, mechanical and electrical equipment and dying products to Russia.

The main countries of consignment were Finland (14% of Estonia’s total imports), Sweden and Lithuania (10% both). Compared to April 2011, arrivals of goods from Russia and Latvia decreased significantly (down by 57% and 31%, respectively). But arrivals of goods from Lithuania and Ukraine increased. Fuels were the main commodities imported from Finland and Lithuania, electrical equipment and transport equipment from Sweden.

According to Estonian Institute of Economic Research, the economic sentiment indicator, which reflects Estonia’s entrepreneurs’ and consumers’ confidence, has also shown a positive trend in the first months of the year. But in April the indicator deteriorated. The same indicator decreased in May besides Estonia also in Sweden and Finland.

Estonian trade by months, 2010–2012

Diagram: Estonian trade by months, 2010–2012

Read more from Statistics Estonia

Average cost of hotel night is 31 euros

According to Statistics Estonia, in April 2012, 205,000 tourists stayed in the accommodation establishments of Estonia, which was 5% more than in April last year.

143,600 foreign tourists and 61,500 domestic tourists used the services of accommodation establishments, whose number increased 7% and 2%, respectively, compared to April of the previous year. Two thirds of foreign tourists using the services of accommodation establishments came from neighbouring countries Finland, Latvia and Russia. Compared to April of the previous year, 6% more tourists from these countries stayed in accommodation establishments. A quarter of the foreign tourists stayed in accommodation establishments located outside of Tallinn, of which 7% stayed in accommodation establishments of Pärnu and 5% of Tartu.

21% of accommodated domestic tourists stayed in accommodation establishments of Tallinn and their number decreased by 2% compared to April of the previous year. 15%, 12% and 11% of domestic tourists used the services of accommodation establishments of Tartu, Pärnu and Ida-Viru counties, respectively. 49% of the domestic tourists were on holiday and 36% on business trips. Compared to April of the previous year, the share of business trips increased and the share of holiday trips decreased.

794 accommodation establishments offered services for tourists. 17,300 rooms and 38,100 bed-places were available for tourists, which was over 100 rooms and 300 beds more than in April last year. 68% of the rooms were available for tourists in hotels, 10% in guest houses and 22% in other types of accommodation establishments. The room occupancy rate was 43% and the bed occupancy rate 35%. The room and bed occupancy rate was higher in hotels, 55% and 49%, respectively.

The average cost of a guest night in an accommodation establishment was 31 euros and was 3 euros more expensive than in the same period of the previous year.

Accommodation by regions, April 2012
Accommodation Total Northern
Estonia
North-eastern
Estonia
Central
Estonia
Western
Estonia
Southern
Estonia
Accommodation establishments 794 164 51 78 226 275
Rooms 17 275 7 904 1 037 1 043 3 899 3 392
Beds 38 067 16 591 2 208 2 588 8 610 8 070
Room occupancy rate, % 43 56 40 21 36 30
Bed occupancy rate, % 35 48 34 16 31 21
Tourists accommodated 205 124 129 272 10 614 6 433 29 638 29 167
Nights spent 404 119 238 196 22 586 12 157 79 518 51 662
residents of Estonia 107 440 30 309 11 879 8 243 26 518 30 491
foreign visitors 296 679 207 887 10 707 3 914 53 000 21 171
Average cost of a guest night, euros 31 35 25 32 24 25

 

Source: Statistics Estonia

Energy prices behind more than half of annual inflation

According to Statistics Estonia, the price level declined by 0.1% in May from April. Compared to the same period a year ago, the price level was 3.8% higher.

Oil-dependent consumer basket components have become the main source of inflation. More than half of the 3,8% annual inflation derives from energy.

Uncertainty in the external environment hiked in May and global financial markets saw a decline in prices. Along with it, commodity prices were also markedly adjusted. In the first months of the year, the price of Brent crude oil was about 10 euros higher that assumed in our previous forecast. By now, the price of oil has fallen back to the expected level of about 80 euros per barrel. The interim oil price peak is the reason why the price of natural gas and thermal energy will go up in the middle of the year.

Core inflation has stabilised at around 2% over the year, being 1.9% in May. Excluding communication services, which have cheapened, the rest of services have contributed to the acceleration of core inflation. This has been caused by wage growth, which continued at the start of the year as well. Since labour is the main production input in the provision of services, there is a strong link between services price increase and wage growth. However, Estonia still has plenty of labour resources, and this should help keep wage pressures in check. There were about 80 thousand unemployed people in Estonia at the start of 2012. About 50 thousand were long-term unemployed.

Eesti Pank will publish its next economic forecast on 13 June.

Author: Martin Lindpere, Eesti Pank, economist

Source: Bank of Estonia

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