Central Europe Review: politics,
society and culture in Central and Eastern Europe
Vol 2, No 7
21 February 2000

C E N T R A L   E U R O P E A N   N E W S:
News Review for Estonia
All the important news from Estonia
since 12 February 2000

Mel Huang


Politics and foreign affairs

The PR department of the defence forces came under heavy criticism for a leaflet campaign deemed political. The leaflets were distributed by uniformed troops in front of the main Tallinn post office, which politicians called inappropriate. The leaflets addressed the current debate over conscription of university students before matriculation. For example, on one it stressed that those in fear of military service are spreading a false rumour that military service can cause brain damage. Defence Minister Jüri Luik called it "totally unacceptable."

The Riigikogu National Defence Committee decided to support a compromise on military service for university students. The bill would allow students matriculating in universities to choose when they would do their one-year national service, all within a three-year window. However, the Reform Party remains opposed to the compromise. The party is heavily supported by the young nouveaux riche.

Foreign Minister Toomas Hendrik Ilves took part in the meeting of EU and associate members in Brussels, where all associate members not already in negotiations with the EU were brought into the process. EU Commissioner for Enlargement Günter Verheugen said there was no problem with Estonia at this point.

Fears of an omnipotent investigative force moved closer to reality, when Prime Minister Mart Laar approved the creation of a tax police. The unit, under the Taxation Department, would be able to investigate tax crimes and file charges.

The trial of Finance Minister Siim Kallas for irregularities which occurred during his tenure as Central Bank head restarted this week. The protracted legal issue involves the time Kallas supposedly committed improprieties in an investment scheme that went sour for a local bank. Though Kallas was acquitted on most counts through various courts, the Supreme Court last year ordered one minor provision on presenting false information back to the lower courts, thus the restart of the trial. The case, however, has been adjourned until a court-appointed accountant can clear up a discrepancy. The defence team is led by Indrek Teder, one of the top power lawyers in Estonia from the firm Rask & Teder. His law partner just happens to be Justice Minister Märt Rask.

The Riigikogu was again paralysed by incessant motions and delay tactics over the issue of property restoration to those who departed for Germany in 1941. The opposition has used the same tactics as during last year's protracted budget debates, by calling ten-minute recesses after each of the hundreds of amendments introduced. Members of the ruling coalition were forced to stand vigil through the night, because if their numbers weaned, the opposition could have voted the measure down.

President Lennart Meri travelled to Bremen to speak at the annual Schaffermahlzeit meeting, a gathering of prominent business and economic figures. There, Meri promoted investments in Estonia and encouraged Germans to take a more active economic role in Estonia.

In a short interview with Eesti Päevaleht, Russian Communist Party boss Gennadi Zyuganov suggested that there could be an Estonian-Russian union in ten to 15 years.

Jaanus Karm was pardoned by President Lennart Meri. Karm was the commander of the military battalion that was involved in the "Kurkse tragedy," in which 14 soldiers drowned in a dangerous training manoeuvre. Karm was found guilty of negligence on his part in leading the troops into such dangerous circumstances, though he in turn blamed his own commanding officers. A higher court had already reduced his sentence to one year before the pardon.

The Russian Foreign Ministry blasted the plan to award 19 former Estonian freedom fighters with state awards, accusing them of being "fascists" who served with the "Hitlerite army." President Lennart Meri is due to issue the awards on 23 February, just before Independence Day. Russia's condemnation for the awarding of those who fought against Soviet occupation was harshly denounced by Estonian politicians, with Foreign Minister Ilves leading the charge: "Estonia hands out orders not knives with a bloody groove like other countries." This is in reference to recent awards handed out by Russian acting President Vladimir Putin to soldiers in Chechnya.

A Russian consular worker is in trouble for alleged smuggling. At the border checkpoint he was found to be transporting 30 litres of Smirnoff vodka and 39,300 packs of cigarettes – which he claimed were for "personal use."

 


Economics and business

The government endorsed the annual memorandum with the IMF, which spells out the country's economic policies for the year and the near future. Importantly, a budget deficit of 1.25 per cent of GDP is expected due to carry-overs from 1999; the government stressed that the 2000 budget remains balanced. The document also dealt with EU integration, privatisation of the few remaining items, pensions reform and more.

Sweden's telecom giant Telia decided to sell off its large stake in the Starman cable television company, paving the way for the latter to enter the telecoms market. Laws prevent the holders of a monopoly in fixed-line communications (Telia holds a large stake in Eesti Telefon) from getting involved in such ventures. Starman announced it would begin offering Internet links via cable, and that it is looking for a new foreign investor.

Thomson Financial BankWatch upgraded the ratings of both large banks in Estonia. The intra-country risk rating of Hansapank is elevated from B to A/B, while Ühispank also moved to a rating of A/B from B/C.

The Wall Street Journal Europe published a survey showing Estonia to be leading in Internet banking in Central and Eastern Europe. The report shows that ten per cent of Estonians use Internet banking, higher than many EU countries as well.

On that same note, tax declarations can now be filed via the Internet and dealt with completely through the two largest banks.

 


Social and local interest

Unemployment went up by 0.2 per cent in January to 5.4 per cent nation-wide, with the north-eastern Ida-Virumaa region still highest, at 9.6 per cent.

Real estate agency OberHaus named Riga as the most expensive city for a two-room flat in the Baltic region. In the centre of town, the usual rent for such a flat is between USD 650 to USD 1200. Tallinn and Vilnius are both lower, at around USD 483 to USD 1034 and USD 900 respectively.

 


And in other news...

Property restoration issues hit a new absurd point when something crept up stemming from the Great Northern War – a continental affair which essentially ended Swedish domination in the Baltic Sea region 300 years ago.

The Estonian service of Voice of America (VOA) strangely escaped the chop, supposedly due to higher ratings among Estonian listeners. However, both the Latvian and Lithuanian services were downsized; the Lithuanian service was cut from six to two employees, while the Latvian service was reduced from five to two employees. Many see this as tantamount to a shutdown.

As if this wasn't expected... Police raided a party held apparently in celebration of famous reggae singer Bob Marley's birthday in a Tallinn suburb only to discover significant drug use. A dozen of the teens were taken to the detox centre on Wismari street (across from the new British Embassy). Police used drug-sniffing dogs on the operation, but the fumes from the building were so overwhelming one official suspected that the dogs had been "traumatised" by the experience.

If you're in Canada and expecting a Christmas card from Estonia, you may be receiving it in the coming weeks. It appears that many of the cards were lost while being processed in Newark, New Jersey, as US Postal Service employees mistakenly placed the mail in with domestic letters, thus the cards were lost in the US postal system en masse.

Finally, cross-country skier Kristina Šmigun increased her lead in the World Cup standings by 95 points, after winning a 5km event in Switzerland.


Exchange rates
As of 18 February 2000

currency Estonian
kroons
(EEK)
1 US dollar 15.83
1 British pound 25.42
1 German mark 8.00
1 euro 15.65

[Up to date Estonian exchange rates can be found here]


Prepared by Mel Huang, 18 February 2000

Archive of Mel Huang's Amber Coast articles


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