BONJOUR L'ESTONIE

Direct sales turnover in Estonia decreased by 15% in 2009

The turnover of the member companies of the Estonian Direct Sales Association fell by 15% in the year-on-year comparison in 2009, amounting to 194 million kroons, writes LETA/National Broadcasting. At the same time, the number of salespersons involved in direct sales grew by 5% to 21,000. According to EDSA, direct sales turnover in Latvia has fallen by 29% and in Lithuania by 19%.

The organisation stated that the decline in sales volume is largely caused by the overall economic situation and fall in consumption.

According to EDSA, in the context of the decline on the manufactured goods sector on the Estonian market of more than 20%, the direct sales enterprises have been rather successful in slowing the decline in sales volume.

“Despite the slow stabilising of sales, the direct sales market in Estonia has potential for a major growth in the future,” stated CEO of EDSA Göran Nordh. He added that therefore, the organisation expects a faster recovery than in the retail sales sector, but that will take place in the second half of the year and not quite as high as before the economic crisis.

EDSA unites in Estonia the direct sales enterprises Avon, GNLD, Herbalife and Oriflame.

Juhan Tere

Number of abortions in Estonia fell considerably in 2009

The number of terminated pregnancies in Estonia fell again significantly in 2009, falling below 10,000 for the first time in decades, LETA/Postimees writes.

Experts find that this is due to better counselling of young people as well as of new mothers. In 2009, there were 9,693 pregnancies terminated in Estonia, 7,542 of them due to patients’ wishes. In 2008, the number of abortions was 10,699.

The number of abortions has fallen constantly since 1991, but last year the fall was steeper than in earlier years, over 10%.

Statistical Office’s senior statistician Kalev Noorkõiv said that the number of abortions was below 10,000 for the first time since 1956. In 1970s, over 40,000 abortions a year were conducted, over two more times more than there were of births.

In 2009, there were 47.8 legally induced abortions per 100 live births – ten years ago (1999), this ratio was 116.7 legally induced abortions per 100 live births.

Turnover of Estonian media advertising market in QI 2010 was 218 million EEK

Based on TNS advertising expenditure monitor AdEx the turnover of media advertising market was 218 million EEK in the first quarter of 2010. Compared to the same period last year when the total turnover was 269 million EEK, the market dropped by 19%.

Though the market still shows the falling trend, the drop is not so rapid as one year ago when the first quarter fell by 34%.

Print media continues to take the biggest fall – newspapers by 26% and magasines by 34%. The decline was the smallest in case of television (12%) and outdoor media (10%). Advertising turnover in radio and internet market fell somewhat slower compared to the whole market – correspondingly 17% and 15%.

Newspapers and television took the biggest share of first quarter’s media advertising market (both 31%). So as we can see newspapers who have become used to their sole leading position had to share it with televiosion, who caught up with newspapers. Similarly to the last year magasines have the smallest share of total market’s turnover – 6%.

Biggest advertisers in the first quarter were two big telekommunication companies EMT and Tele2 Eesti who pushed the traditional leader Procter&Gamble to the third place. Top five ended with Elisa Eesti and retail chain Rimi Baltic.

Bomb threat forces evacuation of president’s home

TALLINN — A 25-year-old man from Järvamaa allegedly made a bomb threat Wednesday evening to the Kadriorg Palace, the residence of Estonian President Toomas Hendrik Ilves, prompting an evacuation.

A man called the police at 8:56 p.m. Wednesday and announced that there is a bomb at the President’s office. The police searched the building and the surrounding but found no explosives.

Maria-Elisa Tuulik, press spokeswoman of Northern Prosecutor’s Office told Postimees that the suspect was detained Thursday morning and that he was caught outside Tallinn.

Mihkel Loide, press spokesman of Northern Police Prefecture told Baltic Reports that as there were no explosives found, the threat was not serious and the president’s family was not at risk.

If the man is found guilty he may face a five-year jail sentence and fines.

This is the first time a bomb threat has been issued for the Kadriorg Palace, although it happens periodically at Estonian schools.

Kai Joost

Hanke : Greek ‘Death Spiral’ may make default unavoidable

Greece’s rescue package doesn’t address the “anti-market” structure of its economy, meaning default may become unavoidable, said Steve Hanke, a professor at Johns Hopkins University.

“Greece’s death spiral will end with debt restructuring or the outright default of its sovereign debt,” Hanke, also a senior fellow at the Cato Institute in Washington, wrote in an article on the institute’s website, dated yesterday. “While politicians and bureaucrats from the European Union, the International Monetary Fund and Greece tell us that the bailout package will defuse Greece’s time bomb, don’t believe their ‘cheerful Charlie’ chant.”

Without the option of currency devaluation, Greece needs to push through tax reform to improve its competitiveness, Hanke said. The country ranks 109th in an “ease of doing business” survey of 183 countries, according to the World Bank. Estonia, a former communist state in line to join the single currency in January, ranks 24th.

“Without growth, Greece is doomed,” said Hanke, who was an architect of Estonia’s currency board, which the country adopted in 1992, pegging the kroon to the German mark.

Bank of Estonia: near recession situation can last in 2011 too

Economic recession can continue in 2010 and the near-recession situation can last in 2011 too, LETA/Äripäev.ee cites a fresh publication by the Bank of Estonia.

“There are signs currently of the realisation of the second way,” Bank of Estonia writes. “This however means that the economic fall can continue in 2010 and the near-recession situation last in 2011 too.”

A poll by the central bank indicated that last year, nearly 40% of Estonian companies estimated that the difficulties in financing economic activities via ordinary channels were high or extremely high. “This indicator is much higher than in other EU states observed,” Bank of Estonia notes.

Juhan Tere

Nordea: major pay growth is not expected in Estonia in 2011

Chief economist of Nordea Estonia Tõnu Palm stated that wages in Estonia may start increasing slowly in the second half of 2011, but no significant growth is expected, writes LETA/National Broadcasting.

According to Palm, the pay decline will continue, at least in the first half of next year. A slow growth is expected in the second half of the year, due to strengthening economic growth and low year-on-year comparative basis.

He noted, however, that as the recovery from the crisis will be a slow one, the unemployment rate will remain high and hence the pay increase will also not be significant. The recovery of economic growth is expected to be based on exports and with the growth in productivity, the pay will mostly increase in the relevant areas.

Palm emphasised that the flexibility of the Estonian labour market is indicative of competitiveness. “The recovery of Estonian economy from the crisis has been largely supported by the falling labour costs; this creates preconditions for sustainable growth,” he said.

Juhan Tere

Estonian Genome Centre hopes to find 5,000 donors more in 2010

The Tartu University Genome Centre found its 45,000th gene donor on May 24 and hopes to reach its 50,000 donors mark before the end of the year 2010, LETA/Postimees Online reports.

In the future, the Genome Centre will focus on research and development work, supplementing the data of the existing donors and adding their genetic info. This means primarily compiling genome charts and complete listing of genomes.

The Centre will also continue to issue anonymised health data for different science studies and development projects.

The aim of the reserve for 2010 was to collect the genome and health data of at least 50,000 Estonian inhabitants to be among bio-banks of pan-European scope. Already it can be said that the project is a success and nearly 5% of adult Estonian population has been recorded soon in the centre.

Juhan Tere

Estonian households made record cuts in spending in 2009

The Bank of Estonia stated that Estonian households have never before made such forceful adjustments in their consumption as during the year 2009, writes LETA/Postimees Online. Mostly the households abandoned major purchases: cars, clothes, audio, video and phone equipment, noted the central bank in its overview “Monetary Policy and Economy”.

In its analysis, the Bank of Estonia noted that households also decreased spending on convenience goods and food. Expenses on the latter article fell by 14.1% in the fourth quarter of 2009 in the year-on-year comparison. This indicates that some households, the family budget has become very difficult.

In the year 2010, the private consumption level is expected to remain close to that of the year 2004 and will continue having a negative contribution on the economic growth.

At the same time, the central bank sees that creation of new jobs and the improvement of the overall situation in the economy will in coming years increase families’ incomes and supporting the recovery in private consumption.

The completion of restructuring in enterprises will in near future help improve the confidence of those who have maintained their jobs and this will make it possible for them to start applying for more loans yet again.

Juhan Tere

Skandiabanken tops ratings for online banking

Skandiabanken ranks first and Swedbank last. At Cybercom's behest, Keynote Systems, a leading US research company, investigated how Swedes experience banks on the internet. For the overall Nordic region, Skandiabanken tops the list while Jyske Bank in Denmark ranks last.

Internet today is the most common method in the Nordic countries for customers to handle banking services. In its role as a leading supplier of internet services, Cybercom asked Keynote Systems, a US research firm, to rank Nordic banks. Keynote Systems has researched American and British opinions and experiences for years of leading US and British banks on the internet.

In April and May, 2,100 Nordic test subjects attempted to open bank accounts and take out loans in various Nordic banks. For the entire Nordic region, Skandiabanken tops the overall rating, while Jyske Bank in Denmark received the lowest user score. In Sweden, Skandiabanken held the top standing, followed by Handelsbanken, Danske Bank, SEB, Nordea, and Swedbank in last position. There are big differences between the top-rated and bottom-rated banks in each country.

Metals tycoon eyeing Swedbank's Russia unit

MOSCOW - Russian businessman Mikhail Prokhorov is considering buying the Russian unit of Swedish bank Swedbank, Kommersant newspaper reported on Wednesday citing market sources.

Swedbank said a year ago it could sell down its interests in its Russian and Ukrainian units.

Prokhorov, who cashed out of his stake in top world nickel producer Norilsk Nickel just before markets melted down in 2008, has deployed some of his cash in distressed financial assets.

He owns half of top Russian investment bank Renaissance Capital. He also purchased the New Jersey Nets basketball team in the United States.

Earlier reports have pointed to Finnish group Pohjola as another contender for the unit, which had lent heavily to the construction industry.

Over 4,600 persons emigrated from Estonia last year

According to preliminary data of Statistics Estonia, in 2009, 4,647 persons emigrated from Estonia and 3,643 persons immigrated to Estonia. Since the restoration of independence emigration has exceeded immigration in Estonia.

In 2009, immigration stayed on the level of the previous year, but emigration increased by about 200 persons. Emigration increased first and foremost among men. The share of young people  aged in their twenties accounted for the largest share of emigrants and immigrants. The main countries of destination were Finland, Russia, Sweden, United Kingdom and Germany. In addition to the above mentioned countries, people immigrated to Estonia also from Latvia and Ukraine.

Internal migration (change of the place of residence surpassing the county, city or rural municipality borders) increased by about a fifth in 2009 compared to the previous year and reached the level of 2007, when nearly 37,500 persons changed the place of residence over the county, city or rural municipality border. Migration increased the population number of Alajõe rural municipality to a record level — nearly 1.5 times during the year (44%). But as migration events are recorded by registering the new place of residence in the Population Register, the migration of Alajõe rural municipality was influenced by mass registration in connection with elections in 2009 and probably there was no real migration to the rural municipality in all cases.

Estonia wages fall in Q1

The average gross monthly wage in Estonia stood at EEK 11,865 in the March quarter, which is 2.3% lower compared to the same period a year ago, Statistics Estonia said on Tuesday.

This follows a 5.9% decline in the final quarter of 2009, and is the fifth straight quarter in which average monthly wages have dropped.

Monthly wages decreased the most in financial and insurance activities while the largest increase was recorded in manufacturing.

Meanwhile, the average gross hourly wage stood at EEK 74.50 in the March quarter - 2.7% lower than a year ago.

Hourly wages increased the most in agriculture, forestry & fishing and decreased the most in real estate activities.

Malcolm Lincoln hears a siren at Eurovision Song Contest 2010

The Eurovision Song Contest 2010 is underway in Oslo Norway, and the third contestant of the evening is Malcolm Lincoln of Estonia. Malcolm is full of energy.... I will give him that. He performed his song Siren, dancing and prancing and jumping around the stage, all the while making theatrical gestures with the microphone to the side of the head as if to ask you if you can hear the "Siren in his head."

Clearly influenced by Brit pop sounds like Coldplay, he has a bright voice, but it lacks the warmth and polish of some of the great artists of our time. Malcolm is an interesting fellow, quirky might be a better way of putting it. He is backed up on stage by an upright piano and a quartet of male back-up singers.

I think that he may move on to the finals with a performance like that, but he is unlikely to win the whole thing. I would love to hear what your opinion of Malcolm's singing of Siren is. Would a sound like that translate to a British or American audience?

Estonian security services market fell by nearly a fifth in 2009

According to the Estonian Association of Security Services Companies, the total volume of the Estonian security products and services market was around 1.86 billion kroons in 2009, a fall by 17.7% from 2008, LETA/Postimees Online reports.

The installation and maintenance of security equipment has been hit the hardest, as volumes have fallen 27.3% in a year.

Despite changes at the market, G4S Eesti AS still has the leading position at the market, having increased its market share. Pristis AS gained the second position. KGrupp Turvateenused OÜ and Turvateenistus Alfastar OÜ posted increased services volumes.

Companies operating in the security services and products sphere employ more than 5,800 people in Estonia.

Juhan Tere

Estonia vs. Croatia

This will be Estonia's last game before the Baltic Cup who will take place in July. They have already played a friendly game against Finland, winning 2-0 after goals scored by their star player Oper and Post. Defender Klavan and Jaager will not play for Estonia, but they will have important defender Piroja from Fredrikstad back in the squad. Also, striker Vitali Gussev from Astra Ploiesti is out from the squad, but he is not important by any means.

Croatia is going to Tallinn after winning 2-0 on Sunday against Wales. It was a rather bad game for the Croatians who had to work hard against a Welsh squad who came without their big stars, mainly with players from Championship or League One. Kranjcar and Corluka are not in the squad because of injury but coach Bilic will have much more important squad problems for this game. Strikers Mandzukic, Mate Bilic and Jelavic picked late injuries, Eduardo is not fully recovered while Olic and Petric will get a rest.

So, they will most probably play without a real striker, Bilic announcing already he will try new tactics for this game. As  late news, it seems Dario Srna and gk Pletikosa will also miss the game.

Estonia backs introduction of simplified visa regime between EU and Ukraine

Estonia supports the introduction of a simplified visa regime between the European Union and Ukraine, Estonian Foreign Minister Urmas Paet has said.

He said this at a meeting with his Ukrainian counterpart Kostiantyn Hryschenko in Sopot, Poland, the Estonian Foreign Ministry's press service told Interfax-Ukraine.

Paet said that the "the simplification of travel to the EU countries will favour the rapprochement between Ukrainian society and the European Union."
He also noted that his country supported Ukraine's associate membership of the EU and the signing of an EU-Ukraine free trade agreement.

Paet said that the EU's Eastern Partnership program provided a good chance for Ukraine to get closer to the EU.

"The Eastern Partnership program is an opportunity, under which the EU-Ukraine cooperation can be further strengthened," he said.

He also said that "Ukraine is one of the priority states for Estonian foreign policies."
Paet expressed hope that an inter-governmental commission would begin to work and that a social insurance agreement would be signed with Ukraine.

Estonia needs ‘Corrective’ pay cuts to revive trade, Oxley says

Estonia, which won the European Commission’s backing to become the euro’s 17th member in January, must push through deeper wage cuts to remain competitive or risk seeing its external debt level rise, Capital Economics said.

Unit labor costs have risen by more than 30 percent in Estonia since 2006, compared with 7 percent in Germany, David Oxley, a London-based emerging markets economist at Capital Economics wrote in a note today. The real effective exchange rate of the kroon adjusted for unit labor costs “would make Estonia one of the least competitive euro-zone economies,” he said.

The government and central bank say annual export growth last quarter shows the $17 billion economy has remained competitive, with exporters gaining market share in their main Nordic markets. Wage reductions have been sufficient to restore competitiveness, according to deputy central bank Governor Marten Ross. Still, Estonia has net external debt of 80 percent, pointing to a “private indebtedness problem,” Oxley said.

Average wages may fall 3.8 percent this year following a 4.6 percent decline in 2009, the central bank estimates. Wages will grow 1.2 percent next year and 3.2 percent in 2012, the bank said last month. This compares with an average annual increase of 16.8 percent in the three years to 2008 following Estonia’s 2004 EU accession.

Baltic states to hold joint military exercises

Tallinn - Baltic NATO members Estonia, Latvia and Lithuania will hold regularly scheduled joint exercises next week, preparing them to host allied forces, the Estonian defence ministry told AFP Monday.

"It's a lot of coordinating and training logistical cooperation but not only," Estonian defence ministry spokesman Peeter Kuimet said.

"We will also train joint actions on crisis management and look at how legislation in Baltic states is prepared for such cases," he added.

The exercises dubbed Baltic Host involve the three Baltic countries and the US European Command and will run from May 31 to June 4.

Civilian officials from police, emergency search and rescue, Baltic sea ports, railways and airports that could be involved in receiving allied forces will also be involved in the exercises, Kuimet added.

Having lost their independence to the Soviet Union during World War II, the three Baltic states re-emerged as sovereign states in 1991 and joined NATO in 2004.

Copyright FOCUS Information Agency

Business merges with politics in a 3-billion-kroon project

Businessman Rene Varek who is son of Toomas Varek, an influential member of the Centre Party, has become one of the main players in the City of Tallinn project to build a high-speed tram line between the centre and Lasnamäe that could cost 3 billion kroons, writes Äripäev.

Shortly after a delegation of the City of Tallinn headed by mayor Edgar Savisaar, chairman of Centre Party, signed a cooperation agreement for the project in China, Rene Varek became a majority shareholder in Railcar Ltd.

Varek who himself participated in the delegation and signed the cooperation agreement with the Chinese claims that he has no interest in politics and considers its purely a business project. According to Varek, he has good contacts with Chinese manufacturers of railway and tram equipment.

Although no tender or competition has been held yet by the City of Tallinn for the project, Railcar was mentioned in a press release of the City of Tallinn as the general contractor of the tramline.

A representative of the Tallinn City Government said that it was a mistake and that Railcar participates in the project as a consultant. "It was Railcar that took the initiative and brought together the City, China Development Bank and Chinese manufacturers, said the source.