Port of Tallinn might need 3rd cruise ship quay

While finding its quay capacity to be sufficient for the next five years, Port of Tallinn does not rule out the possibility that a third quay for cruise ships will have to be built in addition to the 421-meter quay Number 2 completed at the Old City Port last spring.

Ain Kaljurand, CEO of the state-owned port company, told BNS he believes that the present quays provide the company with sufficient capacity to accept all cruise ships that wish to come here in the next five years.

Tallinn is capable already now to accept all cruise ships that can enter the Baltic Sea.

“If necessary, we can build additional quay-meters, we haven’t locked ourselves out in that respect with what we’ve built so far,” Kaljurand said.

He said cruise operators have had good words to say about the investments made by Port of Tallinn in cruise ship quays.

“We have understood that this is necessary, as ships have become bigger and our previous infrastructure would not have enabled us to accept all ships and we would have had to refuse some arrivals. And when you refuse one arrival, a snowball effect will follow and at one point you have missed tens of ships perhaps just because you refused one ship,” he said.

While it’s difficult to offer any forecasts as regards developments on the cruise market, right now this sector is in stable development and the Baltic Sea remains a popular destination, according to Kaljurand. Despite the sanctions and global crisis in a sense, there has been no sign of s setback,” he said.

He said executives of the port who recently arrived from the world’s largest cruise fair in Miami described the situation of the cruise market as quite the opposite to a crisis. “The Baltic Sea is generally very attractive for cruise operators and passengers. The Baltic Sea is made attractive first and foremost by St. Petersburg, without St. Petersburg we would definitely be marginal in terms of market share,” Kaljurand said.

Port of Tallinn expects 490,000 cruise tourists and 292 cruise ships to visit the Estonian capital in 2015. For the cruise port of Saaremaa Island six ship calls have been booked involving about 3,500 passengers. Pullmantur, which uses Tallinn as turnaround port, has cut the number of turnarounds here to three this year from five in previous seasons.

Source: BNS via Estonian Review

Production increased in manufacturing and energy production

According to Statistics Estonia, in February 2015, the production of industrial enterprises increased by 5% compared to February of the previous year. Production increased in manufacturing and energy production, but decreased in mining.

In February, the production in manufacturing increased 6% compared to the same month of the previous year. The growth in production volume was caused primarily by an increase in the manufacture of electronic and wood products, where production rose 24% and 14%, respectively. In February, among the branches of industry holding larger shares, the production rose in the manufacture of food and metal products and electrical equipment. Production growth was not broad-based – in February, more than half of the branches of industry did not achieve the volume of the previous year. Among the branches of industry holding larger shares, the volume of production fell in the manufacture of chemical products, building materials and plastic products.

71% of the whole production of manufacturing was sold on the external market in February. Compared to February 2014, export sales as well as domestic sales of manufacturing production rose about 3% according to unadjusted data.

In February 2015 compared to January 2015, the seasonally adjusted total industrial production increased by 2%, manufacturing production by 1%.

Compared to February 2014, the production of electricity increased by 8% and the production of heat by 1%.Diagram: Volume index and trend of production in manufacturing

 

Read more from Statistics Estonia

In February the retail sales of goods was 267 euros per inhabitant

According to Statistics Estonia, in February 2015 compared to February of the previous year, the retail sales of goods of retail trade enterprises increased 8% at constant prices. In January the retail sales increased 5% compared to the same month of the previous year, while in February the growth in retail sales accelerated.

In February 2015, the retail sales of goods of retail trade enterprises were 350.9 million euros, which was 267 euros per inhabitant.

The growth of retail sales in stores selling manufactured goods accelerated significantly compared to the previous months. In the previous three months (November–January), the retail sales of those stores showed a stable 7–8% growth year over year, whereas in February the growth was 13%. The acceleration of retail sales growth in stores selling manufactured goods was partly influenced by the very low reference base of February of the previous year.

In February, the retail sales via mail order or the Internet increased the most, with sales increasing 41% compared to February 2014. A higher than average increase occurred also in other specialised stores, such as stores selling computers and their accessories, photography supplies, books, sports equipment, games and toys etc. (20% growth) and in stores selling second-hand goods and in non-store retail sale (stalls, markets, direct sale) (19% growth).

The retail sales in grocery stores have been rather stable in recent months. In February, the retail sales of these stores increased 4% compared to February of the previous year.

The retail sales of automotive fuel increased 6% at constant prices compared to February 2014.

Compared to January, in February, the retail sales in retail trade enterprises decreased 7% at constant prices. According to the seasonally and working-day adjusted data, the retail sales stayed at the same level compared to the previous month.

In February, the turnover of retail trade enterprises was 416.8 million euros, out of which the retail sales of goods accounted for 84%. Compared to February 2014, the turnover increased 6% at constant prices. Compared to the previous month, this indicator decreased 6%.Diagram: Retail sales volume index of retail trade enterprises and its trend

The statistics are based on the questionnaire “Turnover”, the deadline of which was 15 March 2015, and on VAT declaration data from the Estonian Tax and Customs Board. Statistics Estonia published the monthly summary in 11 working days.

Source: Statistics Estonia

The quality of the loan portfolio of the banks continued to improve

Loans and leases were issued to Estonian companies and households moderately in February, which is common at the start of the year. The financing portfolio grew by relatively little over the month, and stood at 15.3 billion euros at the end of February.

The annual growth in the corporate loan and lease portfolio was 3.3% in February. The 704 million euros of new loans and leases to companies was around one tenth more than was issued in February last year. Financing in recent months has mainly been for companies in real estate, manufacturing and trade. Some 70% of the total value of long-term loans issued in February went to companies in these sectors.

The volume of new housing loans issued during the month was about the same as a year earlier. The annual growth in the portfolio was 2.9% in the first two months of the year. The volume of other household loans has remained the same for a long time now at 1.4 billion euros.

Average interest rates on loans have been affected in the second half of last year and the start of this by the decline in the 6-month EURIBOR, which is the base interest rate for most loans. The average interest rate for housing loans issued in February fell to 2.2%, while the average interest rate for corporate loans has remained at 2.5% in recent months.

The quality of the loan portfolio continued to improve in February. Loans overdue by more than 60 days were lower in volume than in January, accounting for 1.6% of the loan portfolio at the end of the month. The quality of loans to trading companies has declined slightly in recent months, though this has been offset by an improvement in the quality of other loans.

The annual growth of household and corporate deposits was 5.5% in February, similar to what it had been in the previous month.The growth in deposits was mainly driven by an increase in household deposits. There was little change in the volume of corporate deposits in February and annual growth in them remained at 2% for the second consecutive month. Non-resident deposits increased modestly in February and they remained at 21% of the total of corporate and household deposits.

Source: Bank of Estonia
Author: Mari Tamm, Financial Sector Policy Division of Eesti Pank

Estonian bus company demands the opening of Latvian transport market

The bus company Lux Express has started gathering signatures to a petition asking the Latvian government to open its domestic transport market.

According to Lux Express, the closed ticket system of domestic intercity connections in Latvia has caused stagnation in the transport sector.

Lux Express successfully operates domestic bus lines in Estonia and wishes to do the same in Latvia, its stands in the petition.

The number of passengers carried by buses of Lux Express Grupp grew almost 2.3-fold year over year to 1.65 million in 2014 and profit almost doubled to 2.5 million euros. Altogether 1,646,400 passengers travelled on routes operated by Lux express, compared with 718,200 in 2013, the increase being a result of the opening of both new international and domestic Estonian bus routes, the company said.

Source: BNS via Estonian Review

Estonia preparing for EU presidency

In anticipation of Estonia assuming the presidency of the European Union in the first half of 2018, the preparations have begun. Matti Maasikas, the Estonia’s Ambassador to the EU, told ERR that holding the presidency is like a “matriculation exam” for the country.

The task of the presidency is to ensure coordination and consistency in the decision-making process of the European Council and to facilitate negotiations with the European Parliament and European Commission.

Estonia will employ approximately 1,300 dedicated civil servants to accomplish this task – about 1,000 of them will deal with the policies and 300 as supporting personnel. The army of professionals will have to lead 200 working groups, make preparations for processing between 500-700 bills, and organize 1,600-2,000 official meetings.

Half of the 1,000 officials will be working as group or deputy heads, and about 200 will have to be based in Brussels, doubling the number of Estonians currently working at the Estonian representation to the EU. However, despite increasing the number of civil servants in Brussels, Estonia is not planning to expand its existing one, or rent new offices in Brussels – more people have to share the same floor space.

During the current coalition talks between the Reform Party, Social Democrats and IRL, there have been discussions about creating a European affairs’ minister position in the new cabinet, with the special responsibility of preparing for EU presidency.

Matti Maasikas is convinced that in order to ensure smooth presidency, Estonia needs a dedicated minister. “Holding the presidency of the EU is like a matriculation exam for Estonia and it needs an excellent outcome. None of the ambitious projects in Estonia have succeeded, nor will succeed, without a political lead. And none of the countries previously holding the EU presidency have done it without a minister of European affairs,” Maasikas said.

The former EU commissioner Siim Kallas is rumoured to be one of the candidates for the job, but this would effectively rule him out running for President of Estonia, when the position becomes vacant in 2016.

The presidency will cost Estonian tax payer at least 74 million euros, most of it will be spent on organizing meetings and events in Estonia, but 4 million euros will be allocated for presenting cultural events in Brussels and other European capitals. By comparison, Estonia’s neighbour Latvia, who is currently hosting the EU presidency, spent 9 million euros for cultural programs and bought a new residence for its representation in Brussels.

In addition to EU presidency, Estonia is also celebrating the centenary anniversary of its independence in 2018, adding extra pressure for various institutions.

Source: ERR News via Estonian Review

The Supervisory Board of thecental bank discussed the profit distribution

At the regular meeting of the Supervisory Board of Eesti Pank on Tuesday, the board confirmed the current strategy for profit distribution, whereby the central bank gives the state between 0 and 25% of its profit from the previous year.

The Supervisory Board will start to discuss the distribution of Eesti Pank’s profit for 2014 at the next meeting on 28 April.

The Supervisory Board decided that the relative level of Eesti Pank’s capital should increase to the average level of the central banks of the euro area, as the balance of risks to the capital of the Eurosystem as a whole is considered when joint monetary policy decisions are made. This means it is necessary to raise the level of capital by about a billion euros to 1.3 billion.

The ratio of Eesti Pank’s increased capital to the risk assets used for monetary policy is one of the lowest of any of the central banks of the euro area.

Since 1992 Eesti Pank has allocated a total of 129 million euros to the state budget.

Source: Bank of Estonia