Estonian Review 16 - 22 July 2010

FOREIGN NEWS
DOMESTIC NEWS
DEFENCE NEWS
ECONOMIC NEWS
SPORTS NEWS

FOREIGN NEWS

Estonia Supports Starting Transfer of Responsibility to Afghanistan

20 July - At the international conference in Kabul focused on the future of Afghanistan, the Afghan government introduced a detailed action plan that outlines how they will improve the nation’s socio-economic and security situation and promote the implementation of good governing standards. They also emphasised at the conference that Afghan forces will take complete control of security control in the nation in 2014.
Foreign Minister Urmas Paet stated that Estonia has consistently emphasised the need to develop a process for transferring responsibility for security in Afghanistan. “Estonia will continue to contribute to improving the security situation in Afghanistan and developing civil society. The Kabul conference is an important step in coming closer to the common goal of the Afghan people and the international security forces in the country, which is to gradually transfer responsibility for security to the Afghan authorities,” said Paet. “The capability of the Afghan government and the growth of its leadership role with the support of the international community are essential to the stabilisation of the Afghan security situation, re-integration, national reconciliation, and the implementation of reforms that make sustainable institutional and economic development possible. Since we also agreed on a review of the promises and plans at a yearly foreign ministers’ meeting, the decisions approved in Kabul are encouraging,” he stated.
Estonian Ambassador to Afghanistan Harri Tiido stated that the Kabul conference is a sign of how the Afghans themselves want to actively contribute to the construction of their nation with the help of the international community. “The organisation of this conference clearly shows that the Afghan people are prepared to show initiative and take responsibility for shaping the future of their nation,” noted Ambassador Tiido. The ambassador added that the conference shows local inhabitants that their government has made progress and is working persistently to increase security in the country.
Ambassador Tiido also emphasised that Estonia and the international community will continue to contribute to the reconstruction of Afghanistan. “We need to work on implementing long-term projects in Afghanistan in order to achieve lasting results and keep a complete view of developments in the nation,” said Tiido.

OSCE Must Focus on Resolving Protracted Conflicts

17 July - Foreign Minister Urmas Paet gave a speech on the future of security in Europe during the meeting of the foreign ministers of the Organisation for Security and Co-operation in Europe (OSCE) held in Almaty, Kazakhstan today. Paet said that there is no security without respect for human rights and fundamental freedoms. “We must pay close attention to the protection of human rights and freedom of the media,” he noted.
Paet stated that the OSCE must also focus on resolving protracted conflicts. “In order to deliver some real progress, we must address issues related to South Ossetia and Abkhazia, Transnistria, and the Nagorno-Karabakh,” the Estonian foreign minister noted.
Paet also spoke about the importance of preventing new conflicts from arising. “We must address the situation in Kyrgyzstan in order to minimise the potential for new conflicts to emerge and to prevent the spreading of the conflict to other Central Asian nations,” Paet emphasised. He stated that at the moment the most important activities are ensuring the safety of the people, creating opportunities for refugees to return home, and increasing the contribution of the OSCE so that the ethnic violence would not recur.
Paet stressed that we must also continue to address new security concerns within the framework of the OSCE, such as climate change, energy and cyber security, and terrorism. “It is also necessary for the OSCE to have deeper engagement in Afghanistan so that we can continue contributing to the improvement of the security situation,” he added.
Kazakhstan is the chairman of the OSCE in 2010. The last OSCE summit took place in 1999 in Istanbul, and the last informal meeting took place in 2009 in Greece.
Within the framework of the meeting of the foreign ministers of the Organisation for Security and Co-operation in Europe (OSCE) in Almaty, Foreign Minister Urmas Paet met with the foreign ministers of Georgia, Armenia, Azerbaijan, Switzerland, Macedonia, Montenegro, Serbia, Thailand, Tajikistan, and Canada.

Kazakhstan Important Partner for Estonia in Central Asia

19 July - At his meeting with Kazakh Foreign Minister Kanat Saudabayev, Foreign Minister Urmas Paet said that an Estonian consul has started work in Astana, marking the first time an Estonian diplomat has worked in Kazakhstan and Central Asia. Paet added that Kazakhstan is an important co-operation for Estonia in Central Asia.
The foreign minister stated that relations between Estonia and Kazakhstan have developed quickly. “An intergovernmental Estonia-Kazakhstan commission has started working, and soon an agreement for the protection of investments will be signed,” he said. Paet stated that there are many opportunities for economic co-operation in, for example, the transit, information technology and oil shale sectors. Paet recognised Kazakhstan for its work in resolving the Kyrgyzstan conflict during its time as the chairman of the Organisation for Security and Co-operation in Europe (OSCE).
Estonia also considers the development of relations between the EU and Kazakhstan to be very important, in terms of both the conclusion of a framework agreement and the starting of visa facilitation negotiations. “European Union relations with Kazakhstan could set an example for the EU relations of other Central Asian countries,” Paet added. Estonia also supports Kazakhstan’s efforts to accede to the World Trade Organisation (WTO).
Paet invited the Kazakh foreign minister to visit Estonia.

Paet Addressed Estonian Economic Relations with Colleagues

18 July - Paet and Georgian Foreign Minister Grigol Vashadze signed the agreement for the avoidance of double taxation between Estonia and Georgia and discussed the domestic situation in Georgia and Georgia’s reforms for closer co-operation with the entire European Union.
“Georgia has also been active within the framework of Eastern Partnership. Utilising the Eastern Partnership programme, it is possible to accelerate developments in Georgia in the areas of the economy and developing democratic values. At the same time, it is important for the European Union Monitoring Mission to be extended by at least two more years,” noted the Estonian foreign minister. Paet stated that Estonia supports the continued presence and active observation by the European Union Monitoring Mission. “In addition to observation tasks, in the future the mission should also have a mandate for investigating incidents and patrol and security functions,” Paet noted.
At his meeting with Armenian Foreign Minister Edward Nalbandian, Paet discussed preparations for an agreement for the facilitation and protection of investments that would give entrepreneurs additional security in making investments. Hopefully the agreement will be concluded this upcoming fall. Foreign Minister Paet expressed hope that co-operation would also continue within the framework of European Union Eastern Partnership. “Armenian diplomats have already attended trainings in Estonia, and the Estonian School of Diplomacy is prepared to participate in the development of a diplomatic school in Armenia,” he stated. The Nagorno-Karabakh conflict was also discussed at the meeting. Paet noted that the peaceful resolution of the conflict is extremely important. “Both Armenia and Azerbaijan should utilise all opportunities to achieve peaceful resolutions,” Paet emphasised.
At his meeting with Serbian Foreign Minister Vuc Jeremic, the Estonian foreign minister expressed support for Serbia’s rapid momentum towards EU membership. “Hopefully it will be possible for accession negotiations to begin very soon,” he added.

Estonia Shares e-Election Experience with Macedonia

20 July - This month specialists from the e-Governance Academy will be in Macedonia to carry out the development project, supported by the Estonian Foreign Ministry, to create the capability for electronic identity in Macedonia.
Foreign Minister Urmas Paet stated that the capability to create electronic identity is a prerequisite for implementing modern e-services, including e-voting. “The e-Governance Academy has experience in sharing Estonia’s IT-related know-how with our development co-operation partners. For example, projects have taken place in or are being prepared for Georgia, Afghanistan and Palestine,” Paet stated. “The project being carried out in Macedonia establishes the framework for the know-how of the Estonian government and of IT businesses to be implemented there in the future. The current stage of the project is aimed more at making preparations and increasing awareness,” he added.
Electronic identity in Estonia, which for citizens means the electronic possibilities of an ID card or Mobile ID, has received widespread recognition in the world as a secure and practical base for identifying a user for the purpose of e-services. With their electronic identities, Estonian citizens can use both public and banking services. In the 2009 local government elections the opportunity to cast an e-vote was utilised by 104 000 people, which made up 15% of the votes cast.
The idea to develop electronic identity in Macedonia got its start in 2009, when the President of the Republic spoke during his visit to the Republic of Macedonia about the possibilities of using electronic identity (eID) to vote in the Estonian local government elections that were going on at the same time.
The Foreign Ministry is supporting the project to share electronic identity-related know-how with Macedonia with 148 420 kroons (9 485 EUR) from the Foreign Ministry’s budget for development co-operation and humanitarian aid.

Experts Share Cyber Security Recommendations with UN Secretary General

21 July - Last week the UN task force of national experts called “Developments in Information and Communication Technology in the Context of International Security” finished its work in New York. The group included Estonian expert Linnar Viik. The UN secretary general appointed the 15 experts in the group based on their expertise and visibility in the cyber security sector.
The task of the expert group was to analyse existing and potential threats and risks in the cyber realm and formulate proposals for common standards of behaviour and co-operation methods. In the recommendations made in the final report, it is considered necessary to continue a dialogue among nations in order to reduce the risk of information and communication technology being abused and also to protect critical state and international infrastructure facilities.
“This is a breakthrough report on the level of the UN, because previous efforts made over the last ten years to formulate standard recommendations in the cyber security realm have always ended with no agreement being reached,” said Linnar Viik, giving his opinion on the results.
“Estonia is satisfied with the opportunity to contribute to the work of the task force in an area that is a priority for us and in which the know-how of our experts is highly valued on the global level,” said Foreign Minister Urmas Paet.
The report places an emphasis on working out trust mechanisms and risk-reducing measures, information exchange in national legislative and security strategy sectors, and identifying measures to support the growth of cyber management capabilities in nations with a lower development level. There is a need to develop universal specialised terminology and definitions, which was also prescribed by the UN General Assembly in the cyber security resolution approved on 02.12.2009.
The task force met for the first time in November 2009 and met four times in total. The UN secretary general will present the task force’s report to the UN General Assembly for approval.

Russian State Duma Ratifies Estonia-Latvia-Russia Cross-Border Co-operation Programme

16 July (BNS) - The Russian State Duma Friday ratified an agreement on the allocation of 15.9 million euros to an Estonian- Latvian-Russian cross-border co-operation program, Interfax reported. The treaty on financing the programme was signed by representatives of the European Commission and of Russia on 18 November of last year in Stockholm.
The total budget of the programme that supports cross-border co-operation between Estonian, Latvian and Russian border areas is 73.08 million euros, of which the European Commission will allocate 47.77 million, Estonian 9.4 million euros and Russia 15.9 million euros. Joint social and economic development projects will be carried out in the eligible areas, with the main focus on small and medium-sized companies, enterprise and trade, transport issues, information and communication technology, technology, research and tourism.
The areas will start jointly solving problems connected with the environment, nature protection, renewable energy, protection of cultural and historical heritage. By means of projects involving the civic society as well as undertakings in the cultural, public health and sports spheres special attention is paid to cooperation between the people.
The joint steering body of the Estonian-Latvian-Russian program operate in the Latvian Regional Affairs and Local Governments Ministry. The joint steering body will be responsible for the daily work and financial management of the program. The steering body consists of representatives of each of the participating countries who will jointly decide issues of steering the program, among other things endorsing the work program and deciding the volume and allocation of means.

Estonia Helping Moldova Handle Aftermath of Floods

21 July - Estonia is sending both technical aid and two crisis experts to help Moldova come to terms with the aftermath of the major flooding that took place there in July. The aid is being financed by the Foreign Ministry and organised by the NPO Mondo.
Foreign Minister Urmas Paet stated that the Prut River rising over its banks has caused tremendous destruction, and thousands of people have had to leave their homes as a result of the flooding. “Moldova sent us an appeal for help in liquidating the effects of the flooding. Estonia decided to answer Moldova’s appeal and give the nation aid in handling the aftermath of the floods, thereby helping those who were affected by the floods return to a normal life,” said Paet.
The equipment needed will be acquired through Estonian businesses. Five pump kits along with other equipment meant for cleaning out wells and pumping water from basements will be sent as aid. Concrete needs for additional equipment will be evaluated by the experts being sent. The experts will also deliver the aid, give basic training, and analyse the situation, which will give Estonia the opportunity to support Moldova’s ability to come to terms with the effects of massive flooding.
Estonia is giving Moldova 857 000 kroons (54 770 EUR) to help the country handle the aftermath of the flooding and to help the victims of the floods. The money was allocated from the Foreign Ministry’s budget for development and humanitarian aid.

DOMESTIC NEWS

Lifelong Learning Sees Increase in Estonia

16 July (BNS) - According to Eurostat, Estonia ranks 12th according to lifelong learning indicators among 33 European countries; a few years ago Estonia's rating was 20th. It appears from Eurostat information published this week that 9.3% of Estonians aged 25 to 64 supplemented their education last year; in Europe the figure was 10.6%. In 2007 there were considerably fewer Estonians involved in lifelong learning than the average for Europe.
Eurostat also collects information about countries that are situated in Europe but do not belong to the EU. The data are available for 33 countries and Estonia was 12th among them according to last year's indicators.
Education and Research Minister Tõnis Lukas particularly emphasised the sharp rise in Estonians supplementing their education. While previously there were 6-7 % of adults taking part in lifelong learning, in the past three years we have reached a level that is stably above 10%, the minister said. "Estonian society has made a swift bound into the category of mature societies," Lukas told BNS.
In many countries the trend registered by Eurostat is not similar to that in Estonia. In Latvia more than 8% of people took part in lifelong learning five years ago, but last year the figure fell to 5.3%. The percentage of participation has also fallen in Lithuania, the Czech Republic, Hungary and Ireland.
In addition to Estonia ten other countries have shown a rise, including Denmark where participation was nearly one third of the adult population, 31.6%. Estonia is also above the European average in terms of women taking part in lifelong learning, while the figure for men remains slightly below the average. In recent years, however, there has been a rising trend also among men.

Electronic Certificates to be Given to Citizenship Applicants

16 July (BNS) - The Estonian Education and Research Ministry has sent a bill on a round of endorsements, according to which the certificates of citizenship applicants' Estonian language and Constitution and Citizenship Act exams will be issued electronically starting on 1 October this year. In addition, the examination centre is planning to make certificates of the Constitution and Citizenship Act exams available via the eesti.ee portal.
According to the Ministry's cover letter, delivery of the certificates to citizenship applicants and those who pass the Constitution and Citizenship Act will become move convenient. It will also be easier for those who have passed the exams to prove their examination results as there is no need to keep the certificates on paper. The certificate can be electronically viewed at any moment when the certificate is needed, the ministry said in the cover letter to the bill.

DEFENCE NEWS

Estonian Air Force Marks 91st Anniversary

20 July (BNS) - The Estonian Air Force marked its 91st anniversary on 20 July, in connection with which allies' fighters performed a flyover of the Ämari Air Base in north-western Estonia.
At the line-up at Ämari, the commander of the force, Brig. Gen. Valeri Saar, gave Air Force Crosses of Merit, letters of commendation and souvenirs to the most distinguished members of the force and public servants, spokespeople for the General Staff said.
"The Estonian Air Force is still relatively young, but looking at the facts we see that our Air Force is older than the forces of the United States and many other countries," Saar observed. "The present-day Estonian Air Force associates itself with the airmen who came together in year 1919 to start building the Estonian aviation forces."
At noon two Polish MIG-29 fighters guarding the Baltic airspace flew over the Ämari air base.

Insurgents’ Arms Stash Found by Estonian Troops in Afghanistan

19 July (BNS) - Members of the Estonian infantry company ESTCOY-10 serving in Afghanistan's southern province of Helmand found, in co-operation with Afghan police, an arms stash of anti-government forces in their area of responsibility. The stash of Taliban fighters contained a pistol, two grenades, explosives, ammunition, rifle magazines and accoutrements, military spokespeople here said. The search also brought to light 40 liters of poppy milk, photographs of Taliban fighters, notebooks with contact information for anti-government fighters, and a Taliban textbook which, among other things, featured math problems teaching addition by adding up rifles.
"This find made local residents' life safer, as checking the cache scared away the owner of the weapons and the confiscation of the explosives found there reduced the threat of IEDs in our area of responsibility," Capt. Janek Kesselmann said.
The stash was found near the Harozo checkpoint situated in the southern part of Estonian troops' area of responsibility. Harozo is manned jointly by Estonian military and the Afghan police who tipped the Estonians off about a suspect farm in the vicinity.
The Estonian contingent in Afghanistan consists of an infantry company, a logistics support unit, a close protection team and staff officers. ESTCOY-10 has been stationed in Afghanistan since mid-May. It is backed out of Camp Bastion by the logistics support unit NSE-9.

ECONOMIC NEWS

Fitch Upgrades Estonia to A, Outlook Stable

19 July (BNS) - Fitch Ratings has upgraded the Republic of Estonia's Long-term foreign and local currency Issuer Default Ratings (IDRs) to 'A' from 'BBB+' and 'A-', respectively, and removed them from Rating Watch Positive. A Stable Outlook is assigned.
At the same time, Estonia's Short-term foreign currency IDR has been upgraded to 'F1' from 'F2' and the Country Ceiling has been raised to 'AAA' from 'A+'. The upgrades follow formal Ecofin Council approval on 13 July for Estonia's entry into the euro area on 1 January 2011.
"Joining the euro area improves Estonia's risk profile as it reduces risks associated with the country's sizeable external debt and FX lending in the domestic banking system, and gives its banks access to ECB liquidity facilities," says Douglas Renwick, Associate Director in Fitch's Sovereigns group. "Furthermore, Estonia's sound public finances and flexible economy make the country well-suited for a currency union."
Upon joining the euro area, Estonia will become the poorest of 17 members. However, its long-term growth prospects are brighter than average. By some measures, Estonia already looks like an average member of the currency union, with strong governance and institutions, a robust policy framework and an accommodating business environment. However, the Estonian economy has been far more volatile than that of any euro country, with a cumulative 19% drop in GDP from Q407 to date and large swings in inflation (from double-digit to negative rates over eight months last year).

Shops, Restaurants Make Biggest Contribution to Tallink Revenue Growth

16 July (BNS) - The lion's share of the revenue growth seen by the listed Estonian shipper Tallink in the third quarter of its financial year was the result of increased sales by shops and restaurants. Shops and restaurants brought Tallink revenue in the amount of 1.799 billion kroons (EUR 115 mln) in the three-month period, 21% more than during the same period a year ago.
The total unaudited revenue of Tallink in the third quarter ending 31 May of the financial year 2009/2010 reached a record breaking level of 3.167 billion kroons (EUR 202 mln), an increase of more than 415 million kroons or 15%. Ticket sales grew 19% year on year to 780 million kroons in the three-month period.

Sales of Mobile Operator Elisa Turn to Growth

16 July (BNS) - Sales by the Estonian communications operator Elisa Eesti started growing in the second quarter of 2010, seeing an increase of 1.6% over the same period last year and totalling 360.6 million kroons (EUR 23.04 mln).
The CEO of the Estonian operation of the Finnish Elisa group, Sami Seppanen, said the increase was not the result of price increases but of an increase in customer base. At the end of the second quarter Elisa Eesti had 377 800 customers, 4 300 more than in the first quarter.
In 2009, sales of Elisa Eesti amounted to 1.406 billion kroons and operating profit to 478 million kroons.

Electricity Sales of Eesti Energia Up Nearly 9% in June

20 July (BNS) - The Estonian Eesti Energia power utility sold 778 GWh of electricity in June, 8.6% more than in June 2009. To retail clients in Estonia, Latvia and Lithuania, Eesti Energia sold 437 GWh of electricity in June, 2.5% less than last year. On electricity exchanges and to electricity resellers, Eesti Energia sold 341 GWh of electricity in June, 27.2% more than in the same month last year, Eesti Energia said on Tuesday.
Eesti Energia said that the June sale was presumably positively influenced by continued growth of industrial output in Estonia. The effect of outside temperatures was modest in June.
Starting on 1 April 2010, the sale of electricity in Estonia has been influenced by the opening of the electricity market and gearing of the Estonian price area of the Nord Pool Spot electricity exchange, the company said in its report.
This June Eesti Energia produced 9 000 tons of 60 000 barrels of liquid fuels, 10.6% less than last June. The contraction of production volumes, the company said, was due to the shorter time during which the equipment was working. The sale price of liquid fuels is influenced by the world market price of fuel oil via the world market price of crude oil - in June the average price of Brent crude was 61.4 euros per barrel, 25.1% higher than last June.
In June Eesti Energia sold 14 GWh of thermal energy, 4.3% less than in the same month last year.

Nordea Pank Eesti Earsn 10 Mln Net Profit in January-June 2010

21 July (BNS) - Nordea Pank Estonia earned a net profit of 156.4 million kroons (EUR 10 mln) in the first six months in 2010, 46% more than the year before. The bank's total revenues grew by 27% against the same period last year, amounting to 520 million kroons, Nordea Pank said.
The bank's loan losses stood at 148.3 million kroons in the first half of the year.
The sum total of Nordea Eesti assets was nearly 48.8 billion kroons as of the end of June, 2% more than in the same period last year. The bank's loan portfolio amounted to nearly 42 billion kroons as of the end of June, growing also by 2% compared with the same period last year.
The loan and leasing portfolio of Nordea Eesti amounted to 25.1 billion kroons as of the end of June; of this the amount of corporative banking loans grew by 3% compared with the same period last year. The private persons' loan and leasing portfolio also grew by 3% and totalled 14.5 billion kroons as of the end of June.
The share of loan losses of the total portfolio was 0.36% in H1, and continued to be lower than the Estonian average. The sum total of deposits by Nordea Eesti clients continued to increase and totalled more than 12.6 billion krooons as of the end of the first half of the year.
As of the end of June Nordea had 141 556 clients, 21 offices and 522 employees in Estonia. The H1 profit of the Nordea Group before loan loses was 2.1 billion euros

SPORTS NEWS

Kanepi Wins First WTA Tournament of Her Career

18 July - Estonia’s best tennis player Kaia Kanepi (WTA No. 38) won a WTA tournament for the first time in her life on Sunday. Kanepi defeated Italian Flavia Pennetta (WTA No. 12) 6:4, 6:3 in the finals of the Palermo women’s tennis tournament, which earned her a $220 000 prize. She is the first Estonian to win a WTA title.
This was the third time in her career Kanepi reached the finals in a WTA tournament. In the fall of 2006 she was defeated in the Hasselt final by Kim Clijsters, and in fall of 2008 she lost to Caroline Wozniacki in Tokyo.