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COUNTRY PROFILES


PROFILE

Country Profile

Area: 45,227 sq km (17,462 sq m)
Population: 1.34 million
Capital City: Tallinn (Pop: 410,050)
People: 68% Estonian, 25% Russian, 7% other
Languages: Estonian (the official language), Russian
Religion(s): mainly Lutheran; Orthodox Christian
Currency: Euro
Major political parties: Centre Party, Green Party, People's Union, Reform Party, Res Publica and Pro Patria Union, Social Democrats.
Government: Parliamentary Democracy
President: Toomas Hendrik Ilves (2006)
Prime Minister: Mr Andrus Ansip (2005)
Foreign Minister: Mr Urmas Paet (2005)
Membership of international groupings/ organisations: Estonia is a member of numerous international organisations including: United Nations (UN), Organisation for Co-operation and Security in Europe (OSCE), North Atlantic Treaty Organisation (NATO), European Union (EU), Council of Europe (COE), Euro-Atlantic Partnership Council (EAPC), World Trade Organisation (WTO), Council of the Baltic Sea States (CBSS) and the Organisation for Economic Co-operation and Development (OECD).

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ECONOMY

Basic Economic Facts: (Source: Estonian Ministry of Finance (www.fin.ee) & Statistical Office of Estonia ( http://www.stat.ee (http://www.stat.ee) )
GDP: €13.7bn (2009)
GDP per capita: €10,175 (2009)
Annual Growth: -14.1% (2009)
Inflation: 0.1% (2009)
Unemployment: 13.3% (end 2009)
Major Industries: Timber, food processing, machine production
Major trading partners: Finland, Sweden, German, Latvia, Russia
Further information about Estonia's economy can be found at UK Trade & Investment Country Profile: Estonia (http://www.uktradeinvest.gov.uk/ukti/estonia) Estonia is a small but dynamic country in the North East of Europe, which in recent years has made a name for itself for innovation in e-commerce and e-government.
After regaining its independence in 1991, Estonia made remarkable progress in its transition to a liberal market economy. The government followed an open market policy, with little or no trade barriers, which saw sustained levels of growth, averaging around 4-5% a year. After EU accession in May 2004, growth accelerated to around 10%. The economic boom was fuelled by low interest rates and constrained by the limited workforce, driving up consumer prices and wage inflation. Following a few years of rapid convergence, the need for structural changes to the economy became evident in 2007. The small and flexible Estonian economy started its adjustment, although this was then interrupted by the global economic crisis, and in 2008 the economy went into recession. However, due to the prudent fiscal measures pursued by the government, Estonia fared relatively well in its efforts to tackle the recession. The decision in July 2010 for Estonia to join the Eurozone, and the invitation for them to become a member of the Organisation for Economic Co-operation and Development (OECD), can be seen as a vote of confidence in the Estonian economy. Estonia formally joined the OECD on 9 December 2010, and fully adopted the Euro as their national currency on 1 January 2011.

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HISTORY

Recent History

Since regaining independence in 1991, Estonia has progressed rapidly both in terms of its external integration and internal modernisation. It has enthusiastically joined a large number of international organisations and multinational structures, from the Council of Europe in 1993, the EU and NATO in 2004, to the Eurozone from 2011. Internally, Estonia has pioneered innovation in E-governance, with on-line solutions being used to access to government services and promote transparency.

Estonian independence was originally proclaimed in February 1918, in the wake of the 1917 Russian Revolution. Following a lengthy offensive, occupation of Estonia by the German Empire, the invasion of the Russian Bolsheviks and the War of Estonian Independence, Estonian forces, were able to repel Bolshevik troops. They did this with the help of the Royal Navy – something for which Estonians are grateful to this day. Estonia formally gained independence in the Treaty of Tartu (1920), signed with the post-revolution Moscow government. Independent rule lasted until 1940, when Estonia was annexed by the Soviet Union, with Nazi German agreement, according to a secret annex to the Molotov-Ribbentrop pact of 1939. Following a rigged election in August 1940, an Estonian Parliament declared Estonia a constituent part of the Soviet Union. Nazi German forces invaded Estonia in 1941 and occupied the country until 1944, when the Soviet army repelled them and re-established control. Society and industry were modelled along Soviet lines and absolute control rested with the Soviet Communist Party. The UK and most other western countries never recognised de jure the Baltic States' incorporation into the USSR.

The more tolerant political atmosphere in the Soviet Union in the late 1980s allowed pro-independence and reform groups to come to the fore in the so-called 'Singing Revolution'. In March 1990 these groups assumed control of government. The restoration of Independence took place on 20 August 1991, and was recognised by the UK with the rest of the European Community, on 27 August.

Longer Historical Perspective

BBC News Country Timeline: Estonia (http://news.bbc.co.uk/hi/english/world/europe/country_profiles/newsid_1106000/1106425.stm)

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INTERNATIONAL RELATIONS

Relations with Neighbours

In April 2004 Estonia formally joined NATO and on 1 May 2004 also became a member of the EU, thereby completing two long-term objectives, which had dominated Estonia’s foreign policy agenda for more than a decade.

In 1998, Estonia was in the first wave of Central European countries invited to begin negotiations to join the EU. Negotiations were relatively smooth and Estonia was one of the best-performing EU candidates in terms of closing chapters of the acquis, implementing its commitments, and exemplifying clean government. As a concession, Estonia was granted the right to hunt bears and lynx: not endangered species in this forested country. As an EU partner, Estonia frequently adopts a similar approach to the UK on issues such as foreign and security policy, enlargement, relations with Russia, EU2020 and EU relations with the US.

Within NATO, Estonia has been an enthusiastic participant in NATO’s Partnership for Peace programme and has joined peacekeeping operations in the former Yugoslavia, Iraq and Afghanistan, amongst others. Estonia also hosts the NATO- accredited Cyber Defence Centre.

Estonia has developed active co-operation with its Baltic neighbours, Latvia and Lithuania. Intergovernmental co-operation is managed in the framework of the Baltic Council of Ministers. Heads of State and Government meet regularly - at least once a year. Co-operation focuses on areas such as trade, economic relations and EU/NATO integration.

Estonia also maintains excellent relations with its Nordic neighbours, with whom strong historical bonds exist, particularly between Estonia and Finland, whose languages are close. Finland is Estonia's leading trade partner, closely followed by Sweden.

Relations with Russia

The most sensitive issue in relations between Estonia and Russia has been the position of the Russian-speaking minority. As a result of the Soviet occupation (deportation of many of the indigenous population and inward migration by Russians), the ethnic Estonian component of the population fell significantly after 1940. Estonians now account for 68% of the population; 25% are ethnic Russian and 7% other (mostly Russian-speaking former Soviet) nationalities. Most Russian speakers live in the industrialised North East (70% Ethnic Russian) and Tallinn (50% ethnic Russian).

The Estonian Government requires those applying for citizenship to demonstrate knowledge of the Estonian language and constitution. Many Russian speakers, especially the elderly, are reluctant or unable to learn the Estonian language to the required level, and thus remain stateless. Non-citizens with residence permits are entitled to ‘grey’ (aliens’) passports for foreign travel (however, they require a visa for travel to many other countries, including the UK). Non-citizens are entitled to work, live, own property, obtain pensions etc as any other residents in Estonia. They are allowed to vote in local government elections but not national elections. There has been progress in adoption of citizenship, in July 2010 the Estonian Ministry of the Interior’s Population Record showed that the population of Estonia was made up of 84.1% Estonian citizens, 8.6% citizens of other countries and 7.3% of ‘undetermined citizenship’.

In previous years Russia has alleged that Estonia was guilty of human rights abuses against the Russian speaking minority, but the OSCE, which had a resident mission in Estonia between 1993 and 2001, found no evidence to support this. However, the UN, OSCE and Council of Europe recommended the easing of citizenship requirements to help integrate minorities and promote better communal relations, which Estonia complied with.

Controversy over the Border Treaty between Estonia and Russia also affects bilateral relations. After protracted negotiations, a border was agreed in all technical respects in spring 1996 and an agreement was finally initialled on 5 March 1999. In May 2005, both Russia and Estonia formally signed the agreement and the Estonian Parliament ratified it in June 2005. Shortly afterwards, however, the Russian Government withdrew its signature citing concerns over the text of a preamble in the Estonian ratification law.

In April 2007 the Estonian authorities relocated the controversial “Bronze Soldier” war memorial to a military cemetery in Tallinn from its previous location in the centre of the city. The monument had been erected to honour the Red Army re-entering Tallinn in 1944 and was originally called ‘Monument to the Liberators’. Moving the monument led to rioting and one death in Tallinn, and badly affected relations with Russia. Since then, tensions have eased, and there are some signs of improved cooperation, although no breakthroughs in the political relationship.

Relations with the UK

The bilateral relationship between Estonia and the UK is strong, dating back to the British naval assistance given in the fight against the Bolsheviks in 1918, and the first period of Estonian independence. Before the Soviet occupation in 1940, the UK was a major market for Estonian produce. The UK recognised the re-establishment of independence in Estonia in August 1991 along with the rest of the EU, with diplomatic relations being restored in September 1991 and our Embassy opening in Tallinn in the same year. In July 1992, the UK was the first EU member state to restore visa free travel with Estonia. Our Embassy in Tallinn moved to a new building, to its current site, in May 1999.

Over the last 20 years, the UK has established strong bilateral relations with Estonia. There has been valuable cooperation between government departments, and numerous official and parliamentary visits in both directions. Her Majesty the Queen and Prince Philip made a State Visit to Estonia in 2006. The UK also works closely with the Estonian government in the EU, where we have similar approaches on many issues.

The defence relationship is particularly strong, with Estonian troops currently fighting under British command in Afghanistan. Over the years there has been much joint working between the British and Estonian Ministry of Defences (MoDs), involving training and equipment procurement.

There is a UK-Estonia All-Party Parliamentary Group, chaired by Gordon Marsden MP, and an equivalent in Estonia, chaired by Sven Mikser MP.

Cultural Relations with the UK

The British Council has a representation in Tallinn, where they work to strengthen cultural and educational links between Estonia and the UK.

In the UK, the British-Estonian Association (BEST), established in 2002, brings together members of the British community who are interested in Estonia and Estonian culture. They organise cultural events and work alongside Estonian charities and publish their magazine ‘Lennuk’ twice a year.

In June 2010, Estonian ballet dancers Thomas Edur and Agnes Oaks were awarded CBEs in the Queen’s birthday honours, recognising their services to the arts in the UK and their contribution to UK-Estonia cultural relations. Mr Edur and Ms Oaks were the Senior Principal Dancers of English National Ballet (ENB) from 1990 until their return to Estonia in the summer of 2009.

British Council - Estonia (http://www.britishcouncil.ee/)
British Estonian Association in the UK (http://www.britishestonianassociation.co.uk/)

Recent Visits

Inward

-- Toomas Hendrik Ilves (President) in November 2011

-- Andrus Ansip (Prime Minister) in January 2011

-- Urmas Paet (Foreign Minister) in December 2010Jack Aaviksoo (Minister of Defence) in November 2010Tonis Lukas (Minister of Education & Science) in October 2009

-- Tonis Lukas (Minister of Education & Science) in October 2009Andrus Ansip (Prime Minister) in September 2009

-- Jaak Aaviksoo (Minister of Defence) in November 2008

-- Toomas Hendrik Ilves (President) in October 2008

-- Laine Janes (Minister of Culture) in October 2008 to Wales

-- Maret Maripuu (Minister of Social Affairs) in June 2008

-- Juri Pihl (Interior Minister) in April 2008

Urmas Paet (Foreign Minister) in March 2008

-- Laine Janes (Minister of Culture) in February 2008 to Scotland

-- Tonis Lukas (Minister of Education & Science) in February 2008

-- Urve Palo (Minister of Population and Ethnic Affairs) in November 2007

-- Laine Janes (Minister of Culture) in October 2007

-- Viljar Jaamu, (Chairman of Enterprise Estonia) in May 2007

-- Tonis Lukas (Minister of Education & Science) in May 2007

-- Maj Gen Ants Laaneots (Commander of the Defence Forces) in April 2007

-- Toomas Hendrik Ilves (President) in February 2007 (private)

-- Andrus Ansip (Prime Minister) in January 2007 (private)

-- Jurgen Ligi (Minister of Defence) in September 2006

Arnold Rüütel (President) in July 2006

-- Jaak Aab (Social Affairs Minister) in March 2006

-- Raivo Palmaru (Minister of Culture) in November 2005

-- Urmas Paet, (Foreign Minister) in November 2005

Andrus Ansip, (Prime Minister) in October 2005

Almost all of Estonia’s Ministers visited the UK during the second half of 2005, as part of the UK’s EU Presidency programme of events.

Outward

-- Liam Fox (Defence Secretary) in August 2011

-- Nick Harvey (Minister for the Armed Forces) in December 2010Members of House of Commons Defence Select Committee in March 2009

-- Baroness Taylor (Defence Minister) in November 2008

-- Gordon Marsden MP (Chair of All-Party Parliamentary Group), in Sept 2007

-- Visit by the Members of Liberal Democrats Party, in September 2007

-- Pat McFadden (Minister for Employment Relations), in September 2007

-- State Visit by Her Majesty The Queen and The Duke of Edinburgh, accompanied by Margaret Beckett (Foreign Secretary) in October 2006

HRH The Duke of Kent in March 2006

-- Tony Blair, (Prime Minister) in December 2005

-- Baroness Ashton (Constitutional Affairs Minister in September 2005

-- Douglas Alexander (Minister for Europe) in July 2005

-- George Osbourne (Shadow Chancellor)in June 2005

-- Barry Gardiner (Competitiveness Minister) in June 2005

-- Stephen Ladyman (Minister of State for Transport) in June 2005

-- Rosie Winterton (Health Minister) in January 2005

-- Ivor Caplin (Parliamentary Under-Secretary of State, Ministry of Defence) in January 2005

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GEOGRAPHY

Estonia, at 45,227 sq km, is the smallest and the most northerly of the 3 Baltic states, with Latvia to the south. Estonia borders Russia to the east and is only 80km South across the Gulf of Finland from Helsinki. The country is mostly flat, the highest peak being Suur Munamägi hill at 318m (the highest in all the Baltic states) in the south east of the country. Lake Peipsi on the Estonian-Russian border is the fourth largest lake in Europe at 3555 sq. km (but just an average of 7.9m deep), although Võrtsjärv in the south of the country is the biggest lake lying totally in Estonia, at 266 sq km, but just 6m deep.

Tallinn, the capital (population 410,050), is situated on the north western tip of the country. The old town is well preserved within its original walls, both the upper town (Toompea) where the parliament and the Lutheran cathedral are located, and the lower merchant town. The city was an important medieval port and trading centre. In 1234 it joined the Hanseatic League, the trading union, which was the dominant commercial and cultural link across northern Europe. It is now a UNESCO world heritage site.

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TRADE AND INVESTMENT

Trade and Investment with the UK

The UK has a dedicated team working on trade with Estonia. In 2009 UK imports from Estonia totalled more than £122 million, whilst UK exports to Estonia topped £146 million. For more information on trade and investment opportunities, visit the Estonia pages on the UK Trade and Investment website.

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POLITICS

Recent Political Developments

Parliamentary elections on 6 March 2011 resulted in a coalition government of the Reform and Union of Pro Patria and Res Publica parties.

Ansip has been Prime Minister since April 2005. Prior to that he had been the Economics Minister in Juhan Parts' coalition government and before that he served for 6 years as the Mayor of Tartu. Urmas Paet, has also served as Foreign Minister since April 2005.

Estonia has six members in the European Parliament.

The Estonian President is elected by Parliament and may serve up to 2 5-year terms. Presidential elections on 23 September 2006 saw Social Democrat MEP and former Foreign Minister, Toomas Hendrik Ilves, elected as the new President. He took office on 9 October 2006 and was re-elected on 29 August 2011. Prior to Toomas Hendrik Ilves, Arnold Rüütel was President from 2001-2006 and Lennart Meri was in office from 1992-2001.

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Last Updated: February 2012

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