Dear Federal president Dr. Klestil,
Your Grace, Prince Hans Adam of Liechtenstein
Mr. Senator Dr. Batliner,
Mr. former Deputy Chancellor Dr. Busek,
Members of County Government, Mr. Mayor,
ladies and gentlemen!

Let me first thank Dr. Herbert Batliner's European Institute for their activities so far, and especially for the decision to establish the Small Countries Prize of the European Institute. And let me assure you, esteemed Senator Dr. Herbert Batliner and ladies and gentlemen present on this festive ceremony that I duly and highly appreciate your decision to award the first prize to the Estonian Head of State. For me, this is a great obligation as well as great honour. But above all, you have with this prize expressed your recognition and commitment to the people of Estonia who, having shaken off the Soviet occupation, have thereafter with surprising speed managed to restore our state and our place in the world. Those of you, ladies and gentlemen, who have more closely followed the purposeful actions of the Estonian people and know the reasons why the Republic of Estonia has been chosen to the first wave or the first basket of the EU enlargement, can confirm with a clear conscience: Estonia symbolises what we call: ''Small is beautiful''.

The decision to award the Small Countries Prize to the Estonian Head of state was taken by the scientific council of the European Institute. This has encouraged me to share with you some of my observations here in the beautiful hall of the Salzburg Residence; observations that first and foremost concern small countries. I am glad to do this, as I have considered it necessary to address this subject - the role of small countries in the world - two times on the General Assembly on the United Nations in New York, and shall remain true to this issue also in the future, as this is above all an existential problem of the Republic of Estonia.

But first some generalisations, so universally known that they might even seem banal in this hall here.

First. Our world is not growing, but the number of countries in it increases. There are no signs of this tendency abating. The number of small countries is continuing to grow, and it would be light-minded of the world to close its eyes to this reality. The number of small countries can only grow on the account of big ones. In the democratic parts of the world this growth serves to reduce tensions and evoke new creative potential, whereas in the non-democratic parts of the world it increases tensions and induces new crises. The latter is especially valid for the regions where colonialist relationships nurture totalitarian regimes or vice versa, where totalitarian lifestyle has preserved colonialist relations.

Second. There are less than half a million people living in the five smallest countries of the world, this is about six thousand times less than the population of five of the biggest nations. Hence a question: is there some kind of minimum acceptable population, below which a state is no longer able to function as a state? And to reverse the question: is there a maximum acceptable population, beyond which a state is no longer able to function efficiently?

Third. Simultaneously with the emergence of new (small) countries, which may be a tendency best characterising the whole of past century, there is also a reverse tendency that we call globalisation and the emergence of supranational structures. Is the first going to dissolve in the second one? Is a small country just some kind of an embryonic intermediate stage that has to be discarded after birth? This is a question, ladies and gentlemen, to which Estonia's hopes and worries - also those we feel when following the progress of internal reforms in the European Union - are related. This question, which has become so actual today, takes me to my fourth and for me, the most important issue, namely.

Fourth. The production cost of a small state is high. Sustaining a small country's constitutional institutions, diplomatic missions, national defence, membership fees of international organisations, legal system and countless other structures, including international obligations, is a considerably heavier burden for taxpayers than it is in big countries. What is the true reason for small nations' preference of this ostensibly irrational solution: sovereign, although a more expensive lifestyle?

Ladies and gentlemen, the answer is simple. A human being is mortal. And therefore the thought that he may be the last representative of his nation, his language, his lifestyle, habits, values, history and all his generations so far, is unbearable for him. A human being only lives within his culture, is born into it and leaves it with the knowledge that with his life's work, he has added to its immortality.

A human being enacts himself by enhancing his own identity and the identity of his country. Moreover: the standardisation of nuts and bolts, as well as standardisation of measures, weights, the octane number of fuel and also human rights has freed human nature from routine and enabled it to devote itself to creative tasks, to the shaping of such identity that is characteristic first of all or only of himself, his culture, his language, his country. The variety of patterns of thought, when it is based on the common democratic values of Europe, is Europe's strength and the propelling force of its development. So if Europe wants to remain Europe, it should also take care to support and deepen the diversity of European cultures, or in other words, the internal differences of Europe.

And this is how the mission of small countries in Europe is manifested. A small country is more vulnerable, and therefore also more sensitive and quicker to respond to the hegemony that is alien to Europe. It is the mission of small countries to be the barometer of European balance. A small country can only be defined relatively. When compared to Finland, Estonia is a small country, but Finland is a small country when compared to Sweden or Poland, just as Poland is a small country when compared to Germany. And Russia when compared to China. Thus, we can only speak of tendencies.

If the development of Europe should assume a paternalist attitude towards even the smallest of small countries, such tendency may eventually destroy the phenomenon of Europe. Small countries may be a handful, but they are the bearers of European balance. If there were no small countries in Europe, we would have to invent them. And it is not a coincidence that the European Union was born of the initiative of three small countries.

The phenomenon of Europe is the art of maintaining balance, and something more: the art of shifting this balance gradually in the direction favourable for small countries, in the interests of preserving Europe as an idea.

This is the toughest nut of the internal reforms of the European Union, the one that we in Estonia have managed to crack or at least to put into words.

Thank you for your attention!

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