Estonia - a Centre of Northern Europe


Dear participants in the session,

It is my pleasure to greet everybody present and to introduce the session Estonia - a Centre of Northern Europe.

Despite Estonia's absence from the political map of Europe for nearly fifty years, there has never once been any reason to question Estonia's belonging in Europe. The cultural and economic ties with Europe, solidified during many centuries, have been of paramount importance, even against the pernicious influence of Soviet ideology. Situated at a crossing of important trade routes, Estonia has had a significant place in Northern Europe for ages. For example, let us recall the period of the Hanseatic League, when Tallinn and other Estonian towns had an important role to play as trade centres and as agents in east-west trade.

But let us drop history and return to the present time.

We stand witness to the birth of a rejuvenating Europe. For the first time in history European peoples have found a sensible way to co-ordinate their separate interests peacefully. Along with other transition countries Estonia too claims her historical place in Europe. Above all, this finds expression in our determination to join the European Union as soon as possible.

I am glad to note that owing to her radical economic reform Estonia is one of the most likely candidates for the first round of EU enlargement. The priorities of our economic policy have included the generation of an open and stable economic climate where both native and foreign companies would find it safe and lucrative to operate.

The mainstay of economic reform in Estonia has been the monetary reform carried out five years ago - with a system of a Currency Council instituted in the course of it - which has helped to keep the exchange rate of the Estonian kroon constant, thus creating the necessary stability.

The influx of foreign investment into a country is a kind of litmus test of economic reforms in transition countries. Estonia has been able to attract six times the amount of the average per capita direct foreign investment in Central and Eastern Europe. In a number of cases foreign companies that have successfully invested in Estonia have proceeded, jointly with their Estonian partners, to invade Latvia, Lithuania, Belarus and Russia. Many companies have made Estonia their headquarters for the Baltic and St. Petersburg area.

But allow me to return to the original topic of my remarks. As I said already, Estonia has been situated at a crossing of important trade routes for ages, which indicates our favourable economic-geographic position. True enough, in the course of history this position has also brought Estonia a lot of tribulations. The approaching 21st century is presumably much more peaceful and will offer us further new opportunities.

I would like to direct your attention to the so-called North European economic zone, which is obtaining increasingly clear contours. The Baltic Rim countries are about to make up a relative North European economic zone with a population of about 70 million. After the last EU enlargement and in view of pending further enlargements the Baltic Sea is turning into an inland sea of the entire EU, and the region surrounding it is becoming a sizeable northern sector of the European Union.

What could the role of Estonia be here?

Estonia is one of the most dynamic countries in the region, boasting the fastest economic growth.

As a small country Estonia has realized that the pledge of success is openness and close co-operation. That is why to this day Estonia has placed no restrictions on export or import. We have already largely integrated our economy with those of our next-door neighbours - Finland and Sweden - as well as other EU member countries, especially in regard of foreign trade. Let it be known that over 60% of Estonian trade is with EU members.

We have signed a number of important free trade agreements, including with the European Union, with the countries of EFTA, with other Baltic countries and Ukraine.

A strategic position in the heartland of Northern Europe, a dynamic and promising economic environment, and a workforce eager to act and knowing several foreign languages - these are the causes why the Estonian economy has succeeded in internationalizing so quickly and in creating effective economic bonds with neighbour countries.

An auspicious geographic location, a stable and liberal economic environment, qualified and assiduous labour - this is also what we would like to offer our cooperation partners.

Visa-free travel between Estonia and the Nordic countries, introduced this spring, has removed the last hurdles in the formation of a common North-European economic zone.

It is a zone where the formula of success contains Scandinavian know-how and economic potential in conjunction with efficient production in the Baltic countries and with access to the vast markets around.

I invite you to deliberate about it.


Thank you.

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