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"It is not sustainable if the use of deception is continued.", Der Bund


By Rudolf Burger

The result of the EU-Summit was “great progress”, Estonian President Toomas Hendrik Ilves, said. He considers Estonia a model EU country.

Mr. President, during the night from Thursday to Friday EU countries agreed on tightening the budget control mechanisms. Estonia joined this agreement, but four EU member states declined to join. Are you nevertheless satisfied with the result?

Yes. This compromise between 17 euro countries and six (6) additional EU countries represents big progress. Every agreement that stipulates rules, which should be observed by all, is positive. The time has come to take collective responsibility for the mistakes that have been made by some EU countries. This is the only way out of the current debt and financial crisis.

However, this compromise is headed towards a Europe of 23 instead of 27.

It is quite certain that at least Sweden and the Czech Republic will also join this agreement.

Do you see the EU itself in a crisis?

There is the debt and financial crisis. Europe can only be saved if politicians and citizens share the responsibility. The politicians must convey the decisions, which are necessary to overcome the crisis.

Estonia has been a member of the EU since 2004. In the referendum two-thirds of the population supported EU entry. If a referendum were held today, would the results still be the same?

Estonia still has one of the highest rates in support of the EU. Of course, there are problems; but I am sure that Switzerland would think differently about the EU, if its neighbour were a huge country with a population of 800 million.

Does this mean you recommend that Switzerland join the EU?

As a country that had to deal with the recommendations of other people for decades, we do not recommend anything to others.

Is EU membership one of the reasons for the positive economic development?

I believe the reason for our very good economic performance is the fact that we abide by the rules. Unfortunately only very few countries do the same. It is a very good idea to keep the annual budget deficit below three (3) percent and the national debt below 60 percent of the GDP. If all abided by these rules, we would not have any problems.

Estonia abides by these rules – thus you belong to a minority.

This is the fundamental problem of the EU. It worked well during 50 years, based on democracy, a state of law, human rights and freedom. But this is not enough; we also have to keep the agreed rules. In Estonia we abide by the rules with regards to the budget deficit and debts, because small countries depend much more on this than big countries.

Even Germany and France, the two super powers within the EU, violate these rules.

We know that, but Estonia observes these rules, in the same way Finland, Sweden, Denmark and Poland do. The problem is this: how do we continue if a large part of the EU violates these rules? If a country agrees to certain measures – and we as a poor country give money to this other country – but the promises are not kept, then this will become the biggest threat to the EU. It is unsustainable if deception continues.

Croatia, Serbia and Turkey would like to join the EU. Should the EU not first stabilise itself within the current borders?

We very much support the expansion. Croatia has already signed the entry contract. My concern is that the expansion will slow down for a long time. There are sentiments against Turkey. That is a big mistake, because Turkey is the most dynamic country within the range of the EU.

More dynamic than even Estonia?

The difference is in the size. An attitude of “we don’t want these Turks” is short-sighted and will be damaging. We also need Serbia absolutely within the EU, in order to secure peace and stability in the Balkans. Unfortunately, the current atmosphere is such that after the accession of Croatia the political will for (further) expansion is absent.

Estonia has made great economic progress. Your economic policy is sometimes referred to as “neoliberal”.

This is Marxist terminology. We have an economic system that is based on the assumption that wealth on the basis of other people’s money is not real.

You introduced the flat-rate tax. Everyone pays 21 percent of his/her income. Has this proved successful?

A flat-rate tax leads to the result that at the beginning the paying of taxes dramatically improves. I am not sure, whether this is still relevant today. Our economic success comes on the basis that it is not based on debts. We have not had a populist government that floated pseudo-social programs. “Pseudo” means: programs are not financed by collected taxes but rather by accumulating massive debts. The people work hard.

Does the electronic revolution play a role as well?

The IT industry is five percent of the GNP; however, the fact that computer technology is used everywhere has contributed to (more) efficiency, less corruption and better transparency. These are aspects that matter.

Your unemployment rate is still very high. What is being done to change this?

During the economic bubble we were below four percent. Now we rely on programs of further education. We have to equip our people with new skills, if they cannot go forward with their current skill.

Regarding the economic success it is sometimes referred to as the “Baltic Tiger”. You probably like this.

Not really. To talk about “Tigers” in the current economic situation all over the world is difficult. In Estonia we do business differently from other countries, but in a similar way as the Finns.

Is this the country that is closest to you?

We are connected through our languages. Finnish relates to Estonian in the same way as German relates to Swiss German: We understand each other but we do not speak the other language.

Estonia introduced the euro one year ago. Was that a good idea?

Yes. We were faced with speculations against our small currency, and because trust in our currency was lost, owners of homes had to take their mortgages in euros. Strong pressure was exerted, e.g. by Dominique Strauss-Kahn, that we should devalue our currency. This would have increased the interest for the euro mortgages. And then we had the problem of capital flight. Through introducing the euro all of these problems were solved; direct foreign investments in Estonia were made easier, and immediately a burst of growth by about one (1) percent occurred, because fees for exchanging money no longer applied.

55 percent of the population supported the introduction of the euro. Would that still be the case today, after Estonia had to promise two billion euros for the rescue umbrella for countries such as Greece, Italy and Spain?

All of this is correct, but our independence has a price. I like the following analogy: we are a member of NATO. Some member states ask why the airspace of Estonia has to be protected. The only reason some ask this question is: these countries are surrounded by other NATO member states. However, if a country is positioned at the outside border of NATO, it is a different matter. The same applies to the euro: yes, there are problems, and yes, the euro will cost us money, but what is the alternative? Introducing the rouble?

Not really. Does this mean that you still have problems with your big neighbour Russia?

We do not have problems. They have many problems. Perhaps you should read in the newspapers the kind of threats that are expressed.

Threats against whom?

Last month the Russian president said two times on the same day: we intervened in Georgia in order to prevent the enlargement of NATO. On Wednesday Sergei Lavrov, the Russian foreign minister, explained that if Georgia insisted on joining NATO, this could result in a new war. Civilised countries do not threaten each other with war. I am not paranoid, but you would probably also become nervous, if someone said that to you.

Are there still border conflicts between Estonia and Russia?

No, the borders have been determined, but Russia refuses to sign the border treaties. But there has also been no peace treaty between Japan and Russia since 1945, and the Norwegian-Russian border treaty was only signed last year. Russia is slow, it takes time.

Your comments on the Russian election from last week?

Russia has had elections in the past. Last week the Russian foreign ministry stated that the Baltic countries joined the Soviet Union in 1940 voluntarily and that a referendum had taken place. The silly thing was, however, that the referendum in Latvia was held on a Sunday, but the results were already proclaimed in London on the Saturday before. This type of referendum has a long tradition in Russia.

What you say is that Russia is not yet a democracy.

I would say: it has still a long way to go to become a state of the law – the same as in many other countries in our world.

What makes the relationship with your neighbour difficult is the fact that about one-third of Estonia’s population is Russian-speaking and are now obviously becoming an economic lower class.

They have been the herrenvolk [He uses the German word in the English-language interview. –Ed.] for 50 years, and in the sense of the historical meaning of the word they were privileged. Now that they have no more privileges, some people consider this as a loss.

Why is Russian not an official language in Estonia?

Why should it be? Let us assume: we occupy your country and after 50 years we say you have to make Estonian an official language. An occupying force occupies a country, deports hundreds of thousands of people to Siberia and sends its own people to this country. And now, when we are independent at last, we should make the language of our occupiers a second language of the country? Do not ask me ridiculous questions!

Thus your recommendation is: those who are of Russian-speaking descent should make an effort to acquire Estonian citizenship?

Yes, and it is happening.

What are the figures?

8 percent of the population are Russian and are not Estonian citizens, but 25 percent are ethnic Russian – so you can make your own calculation.

What is the situation of the bronze war monument from the Soviet times in the middle of Tallinn? Is it still there?

No, it has been relocated to a military cemetery.

In an interview with Der Spiegel in 2007 you explained that it would be better to leave this monument in its (former) location.

I would probably not have moved it at that time. However, in essence the monument was for the occupants. You can imagine that it was not very popular with Estonians. By the way, I do not understand your obsession with Russia. It is a rather irrelevant part of our life, our trade with Russia is only 8 percent of the total, but that with the EU is 75 percent. Our political questions deal with the EU.

We Swiss are sometimes obsessed with our big neighbour Germany.

I could contact a whole interview without using the R-word. I am an adherent of the American sociologist Daniel Patrick Moynihan, who spoke about the benign neglect. Leave the Russians to themselves. If they have a problem with democracy, let them solve their own problems. Estonia does not have to interfere in their internal affairs. They can do as they please.

President Ilves, on Thursday you were in Bern. What was the purpose of your visit in Switzerland?

Part of our bilateral relationship is to talk about matters in which we cooperate. President Calmy-Rey has been in Estonia two times; therefore, this time it was my turn. Of course, there are big differences between Estonia and Switzerland, for example you have mountains and we don’t.

The highest hill in Estonia is 300 meters . . .

. . . 355. (laughs). But we have the sea. During my visits – not only in Switzerland – I share about how things develop in Estonia. We celebrated the 20th anniversary of the re-establishment of our country in August of this year. 20 years ago we were a poor, underdeveloped part of the Soviet Union, but by now we have come a long way. We have introduced the euro and we are one of the few countries that fulfil the Maastricht criteria. We have no debts and we are rather successful. 

Do Switzerland and Estonia have some things in common as small countries?

Yes, in order to be successful, small national economies are export-oriented, because the domestic market is not big enough to survive. Those who are export-oriented will support liberal trade policies. The question of size was a reason for us to move forward with e-government and e-voting. We are the pioneers in these areas. I spoke about this with President Calmy-Rey, because e-voting would make life easier with the many referenda (in Switzerland).

A personal question: you were educated in the US and later on worked for Radio Free Europe. Did you believe during this time that Estonia might become independent again one day?

Yes, during the final phase I believed it. From about 1987 until 1991 some considered me as crazy, because I thought the Soviet Union might disintegrate. 1986 the director of Radio Free Europe called me into his office and told me: “I like your analysis, but it is hopeless. Estonia will never be independent. You are wasting your talent.” I answered that I believed in the independence of Estonia, because the lack of economic sustainability could lead to the collapse of the Soviet Union, and as a result Estonia could become independent. But during 1982, 83 and 84 under Brezhnev it still looked rather bleak.

It was not planned as part of your curriculum vitae that you would become the foreign minister and president.

That is correct; this was not in my plans.

Before you were foreign minister and now you are president – without much power.

Our constitution follows the example of the German constitution. I have only very little political power; it is rather an intellectual obligation. I believe I have written more essays and speeches as president than during the time when I earned my living through writing.

Do you write your speeches yourself? That would be very unusual for a president.

That is not true. Vaclav Havel, the former president of the Czech Republic, wrote his own speeches. I consider this a part of my job and I try to initiate debates about fundamental questions with regards to domestic and foreign policies. Someone said once: the prime minister must take care of my wallet, and the president must enrich my soul. This describes my task well.

Toomas Hendrik Ilves

Toomas Hendrik Ilves was born in Stockholm in 1953 and grew up in the US State of New Jersey. He studied psychology and worked as scientific staff at Columbia University in New York. From 1979–1981 he was the deputy director and English teacher of a school in New Jersey, and then he was the director of the Art Centre in Vancouver until 1983. From 1983 until 1984 he taught Estonian Literature at the Simon-Fraser University in Vancouver, and from 1984 until 1993 he worked for the Estonian section of Radio Free Europe in Munich. 1993 he was appointed Estonian Ambassador to the US, Canada and Mexico, 1996 he became Foreign Minister, 1998 he became chairman of the North Atlantic Institute, 1999 Foreign Minister again, 2002 he became a member of the Estonian Parliament and in 2004 he became a member of the European Parliament, and finally in 2006 he became President of Estonia. Toomas Hendrik Ilves is married and is the father of three children.

Original article here.