Topic: Economy
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Nikolay Mezhevich

Doctor of Economics, Professor of Foreign Relations Department at St. Petersburg State University

On March 1, 2014 elections to the Estonian Parliament Riigikogu were held. According to the Republican Election Commission (VVK) of the country, 872 people claimed 101 seats in Parliament. The Estonian political spectrum, which was initially unbalanced and right-wing in shaping the country’s foreign and domestic policies, shifts towards the same right direction.

On March 1, 2014 elections to the Estonian Parliament Riigikogu were held. According to the Republican Election Commission (VVK) of the country, 872 people claimed 101 seats in Parliament. 10 parties and 11 independent candidates took part in the elections, and all four parties represented in the current parliament tried to take a nationwide threshold of 5 %. There is no voter turn-out in Estonia. Two other peculiarities of the parliamentary elections in Estonia are also worth noting. Firstly, only Estonian citizens have the right to vote. As a result, approximately 80,000 stateless residents are deprived of the opportunity to make their political choice. Secondly, the system of advance voting in the country suggests electronic voting. This form was used by more than 127 thousand voters of the total number of about 900 thousand.

Here are some features of the electoral cycle.

First, there is an obvious crisis of ideas and economic projects while economy is stagnating and military and infrastructure expenses go up.

The SEB Bank left unchanged the previously compiled forecast of the Estonian economic growth in 2015 at 1.8 %. In 2014, Estonia ranked third among the Baltic States in terms of growth in GDP. The annual GDP growth in Latvia was 2.4 %, in Lithuania – 2.9 %, and in Estonia – 1.8 %.

There is an obvious crisis of ideas and economic projects while economy is stagnating and military and infrastructure expenses go up.

However, there are other points of view too: the total exports from the Baltic countries to Russia in 2015 could be reduced by 18-25 %, so the economies of Lithuania, Latvia and Estonia face the risk of receiving $780 million less than it has been expected. The growth of the Baltic economies in 2015 will be 1.3-1.7 % less than last year. In monetary terms, this reduction is equivalent to 1.58 billion dollars less. This means that the growth of the Estonian economy in 2015 will be 1 %, showing the evident crisis of the development model implemented for a decade.

Second, the foreign policy was unprecedentedly important in the last election. Reformists vigorously campaigned and literally begged people to come to the polls and protect the country from Edgar Savisaar and, of course, Vladimir Putin, i.e. to vote for the ruling coalition. “We will soon know who is going to govern Estonia in the next four years. The decisive week has begun, which will determine if the pro-Estonian Government in favor of cooperation with NATO and the Western states remains or not”. At the present time we can say that they have succeeded.

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Third, there is a wide gap between the promises and their fulfillment. Prime Minister Taavi Rõivas stated that the government, which had been set up by the ruling right-liberal Reform Party and the Social Democratic Party, had lived up to the public expectations. According to Prime Minister, out of 199 proposals in the coalition agreement, 141 promises were realized completely (71 % of the total), 17 % were kept in part and 12 % were not honored. “All the major goals have been achieved,” said the prime minister. Opening the election campaign in October 2014, Estonian Prime Minister said that for the next three years an average annual GDP growth will be 7.7 %, and by 2018 the GDP will increase by 25 %, if the working capacity reform is carried out and students graduate with a degree after spending 4-6 years at universities, not less. Since in 2014-2015 the growth rate is estimated to be 2.5-3.0 %, in the remaining three years Estonia will outdo China.

Fourth, this election cycle is characterized by an extremely fierce political struggle and the early start of the Estonian elite towards the parliamentary elections. This movement began in mid-2014 with replacing Andrus Ansip by Taavi Rõivas as Prime Minister. Taavi Rõivas immediately tried to “renew” the voters’ perception of the ruling coalition.

There were four parties with roughly the same number of seats in the previous parliament of Estonia:

  • The Estonian Reform Party - Eesti Reformierakond (right-wing liberal) – 33 seats;
  • The Estonian Centre Party - Eesti Keskerakond, (orientation, in general, corresponds to the name) – 26 seats;
  • The Union of Pro Patria and Res Publica – Isamaa ja Res Publica Liit (conservative and rather nationalist) – 23 seats;
  • The Social Democratic Party (center-left with certain reservations) – 19 seats.
  • The composition of the new parliament has changed. There are now six parties.
The foreign policy was unprecedentedly important in the last election.

The Estonian Reform Party has lost three seats and now has 30 seats; the centrists have 27 seats, which is one seat more than before; the Pro Patria and Res Publica Union has 14 seats which is nine seats less; the Social Democrats have lost four seats and have now 15 seats.

As to the new parties represented in the Riigikogu, they are the Free Party of Estonia (Eesti Vabaerakond) and the Conservative People’s Party of Estonia (Eesti Konservatiivne Rahvaerakond). Eesti Vabaerakond was established on September 20, 2014 and its political orientation is obviously right-wing conservative, although it is too early to say anything more definite. As for the Conservative Party, it unites conservatives, nationalists and the Right.

Thus, the Estonian political spectrum, which was initially unbalanced and right-wing in shaping the country’s foreign and domestic policies, shifts towards the same right direction.

This election cycle is characterized by an extremely fierce political struggle and the early start of the Estonian elite towards the parliamentary elections.

Estonia is a parliamentary republic and the winning parties form its government. The Reform Party and the Centre Party can theoretically create a coalition. This would be the best option for the country, but the worst one for the political elite. Creating a centrists’ coalition with Social Democrats is pure blue-skying, while right-wing coalitions with decorative participation of Social-Democrats are quite possible. Finally, a coalition without Social Democrats is theoretically possible too, although the reformists and their current allies are unlikely to form it.

Another important result of the elections is as follows. Estonia will hold presidential election soon. The President is elected for a five-year term by the Riigikogu or a special electoral body, which consists of all parliament members and elected representatives of local self-governments. The victory of the reformists and maintaining the current coalition will provide a political opportunity for nominating ex-Prime Minister Andrus Ansip for the Presidency. In this case, the Estonian economic and political policy will be even more oriented towards confrontation with Russia.

Nearly twenty years ago an outstanding scientist and expert on post-Soviet space Dmitry Furman pointed out that “the violent reaction of even the Baltic republics to the developments in Moscow and to all that they regard as the latter’s imperial impulses, shows that psychologically they have not left the (post-Soviet) space yet.” [1] Unfortunately, the situation has not changed. The right managed to win the elections that were held under the slogan of national mobilization and confrontation with Russia. But to develop the economy they need something quite different.

1. D.E. Furman. O budushhem “postsovetskogo prostranstva.” Svobodnaja mysl magazine. 1996. # 6. p.38

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Poll conducted

  1. In your opinion, what are the US long-term goals for Russia?
    U.S. wants to establish partnership relations with Russia on condition that it meets the U.S. requirements  
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    U.S. wants to deter Russia’s military and political activity  
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    U.S. wants to dissolve Russia  
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