Estonia

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Early History

Estonia's struggles for independence during the twentieth century were in large part a reaction to nearly 700 years of foreign rule. Before 1200 the Estonians lived largely as free peasants loosely organized into parishes (kihelkonnad ), which in turn were grouped into counties (maakonnad ). In the early 1200s, the Estonians and the Latvians came under assault from German crusaders seeking to impose Christianity on them. Although the Estonians' resistance to the Teutonic Knights lasted some twenty years, the lack of a centralized political organization as well as inferior weaponry eventually brought down the Estonians in 1227. The Germans, moving from the south, were abetted by Danish forces that invaded from the north and captured Tallinn. Together with present-day Latvia, the region became known as Livonia; the Germans and Danes settled down as nobility, and the Estonians were progressively subordinated as serfs. During 1343-45 an Estonian peasant uprising against the German and Danish nobility prompted the Danes to relinquish their control of northern Estonia to the Germans. After this resistance was crushed, the area remained generally peaceful for two centuries.

Commerce developed rapidly because Estonia's larger urban centers at the time--Tallinn, Tartu, P�rnu, and Narva--were all members of the Hanseatic League, an organization established by merchants of various, mostly German, cities to protect their mutual trading interests. Still, foreign rivalries over the strategic Livonian region began to reemerge in the mid-sixteenth century as the fighting capacity of the Germans diminished and that of neighboring Muscovy began to increase. The ensuing twenty-five-year struggle for control of Livonia was precipitated by an invasion by Ivan IV (the Terrible) (r. 1533-84) in 1558. The advancing Russians wiped out the disintegrating forces of the Teutonic Knights and nearly succeeded in conquering the whole area. However, Swedish and Polish intervention reversed the Russian gains and forced Ivan eastward, back behind Lake Peipsi. Peace between Sweden and Poland in Livonia was also slow in coming, with Sweden eventually winning most of the territory by 1629. By this time, decades of war had caused huge population losses (in some areas, over 50 percent), affecting urban and rural areas alike.

Under Swedish rule, northern Estonia was incorporated into the Duchy of Estland. The southern part, together with northern Latvia, became known as Livland. This division of Estonian lands would last until 1917. The German-based nobility in both areas retained and even strengthened its position under Swedish suzerainty. Meanwhile, the Estonian peasants saw their lot worsen as more and more of their land and output were appropriated by seigniorial estates. Still, during the Swedish era, Estonian education got its start with the founding of Tartu University in 1632 and the establishment of the first Estonian parish schools in the 1680s. Although the population also began to grow during this period of peace, war and suffering once again were not far away. Swedish hegemony during the late seventeenth century had become overextended, making the Swedes' holdings a prime target for a newly expansionist Russia.

In his first attempt to conquer Estland and Livland, during the Great Northern War (1700-09), Peter I (the Great) (r. 1682-1725) met with defeat at Narva at the hands of Sweden's Charles XII (r. 1697-1718). A second campaign in 1708 saw Peter introduce a scorched-earth policy across many parts of the area. The outcome was victory for Russia in 1710 and acquisition of a "window to the West." In taking control of Estland and Livland for what would be the next 200 years, tsarist Russia recognized the rights and privileges of the local German nobility, whose members amounted to only a small fraction of the population. Although the extent of the nobles' autonomy in the two areas was always contested, especially under Catherine II (the Great) (r. 1762-96), the Baltic Germans did develop a strong loyalty to the Russian tsars as guarantors of their landed privileges. German control over the Estonian peasantry reached its high point during the eighteenth century. Labor overtook taxes-in-kind as the predominant means of controlling the serfs. The first real reforms of serfdom, which gave peasants some rights, took place in 1804. In 1816 and 1819, the serfs were formally emancipated in Estland and Livland, respectively.

By the mid-nineteenth century, the Estonians were fast developing into an independent society and nation. The number of urbanized Estonians had grown considerably, overtaking what had been German majorities in the cities. Industrialization was also breaking down the old order. An Estonian cultural awakening began in the 1850s and 1860s (see Religion; Language and Culture, this ch.). Tsarist reaction and a fierce Russification campaign in the 1880s could not extinguish the new Estonian spirit, although for the most part Estonian demands continued to focus on culture. Political demands for Estonian autonomy found strong expression during the Revolution of 1905, and an All-Estonian Congress was organized in Tartu that same year. Although radical Estonian politicians such as Jaan Teemant and moderate leaders such as Jaan T�nisson were deeply divided on tactics, there were widespread calls from the Estland and Livland provinces for a unification of Estonian lands and an official end to Russification. Repression of the 1905 movement was severe in Estland, although T�nisson's moderate Estonian Progressive People's Party survived and went on to participate in Russia's new assembly, the Duma. Amid the turmoil, Baltic Germans also grew apprehensive; they would be upset even more with the outbreak of World War I, which would pit Russia against their conationals.

The fall of the tsarist regime in February 1917 forced the issue of Estonia's political future. Vigorous lobbying in Petrograd by T�nisson and the large Estonian population living there forced the provisional government to accept Estonia's territorial unification as one province and the election of a provincial assembly, the Maap�ev, later that year. The election results showed significant support for leftist parties, including the Bolsheviks, Social Democrats, and Social Revolutionaries. Voting was complicated, however, by the presence of numerous military personnel from outside Estonia.

The Bolshevik takeover in Petrograd in November 1917 extended to Estonia as well, until Germany occupied Estonia in February 1918. Most of Estonia's other political parties realized they were caught between the two forces and agreed to begin an active search for outside support. Representatives were sent to the major European capitals to secure Western recognition of an Estonian declaration of independence. As the Bolsheviks retreated from Tallinn and the German occupation army entered the city, the Committee of Elders (or standing body) of the Maap�ev declared the country independent on February 24, 1918.

Estonia - Interwar Independence, 1918-40

In contrast to its later peaceful return to independence in 1991, Estonia's first modern era of sovereignty began with a fifteen-month war (1918-20) against both Russian Bolshevik and Baltic German forces. In the end, the War of Independence took the lives of about 3,600 Estonians and left about 14,000 wounded. In the Tartu Peace Treaty, which was concluded with Russia in February 1920, Moscow relinquished all claims to Estonia in perpetuity. A year later, Estonia gained international recognition from the Western powers and became a member of the League of Nations. In June 1920, Estonia's first constitution was promulgated, establishing a parliamentary system.

With a political system in place, the new Estonian government immediately began the job of rebuilding. As one of its first major acts, the government carried out an extensive land reform, giving tracts to small farmers and veterans of the War of Independence. The large estates of the Baltic German nobility were expropriated, breaking its centuries-old power as a class.

Agriculture dominated the country's economy. Thanks to land reform, the number of small farms doubled to more than 125,000. Although many homesteads were small, the expansion of landownership helped stimulate new production after the war. Land reform, however, did not solve all of Estonia's early problems. Estonian agriculture and industry (mostly textiles and machine manufacturing) had depended heavily on the Russian market. Independence and Soviet communism closed that outlet by 1924, and the economy had to reorient itself quickly toward the West, to which the country also owed significant war debts. The economy began to grow again by the late 1920s but suffered another setback during the Great Depression, which hit Estonia during 1931-34. By the late 1930s, however, the industrial sector was expanding anew, at an average annual rate of 14 percent. Industry employed some 38,000 workers by 1938.

Independent Estonia's early political system was characterized by instability and frequent government turnovers. The political parties were fragmented and were about evenly divided between the left and right wings. The first Estonian constitution required parliamentary approval of all major acts taken by the prime minister and his government. The Riigikogu (State Assembly) could dismiss the government at any time, without incurring sanctions. Consequently, from 1918 to 1933 a total of twenty-three governments held office.

The country's first big political challenge came in 1924 during an attempted communist takeover. In the depths of a nationwide economic crisis, leaders of the Estonian Communist Party (Eestimaa Kommunistlik Partei--EKP), in close contact with Communist International (Comintern--see Glossary) leaders from Moscow, believed the time was ripe for a workers' revolution to mirror that of the Soviet Union. On the morning of December 1, some 300 party activists moved to take over key government outposts in Tallinn, while expecting workers in the capital to rise up behind them. The effort soon failed, however, and the government quickly regained control. In the aftermath, Estonian political unity got a strong boost, while the communists lost all credibility. Relations with the Soviet Union, which had helped to instigate the coup, deteriorated sharply.

By the early 1930s, Estonia's political system, still governed by the imbalanced constitution, again began to show signs of instability. As in many other European countries at the time, pressure was mounting for a stronger system of government. Several constitutional changes were proposed, the most radical being put forth by the protofascist League of Independence War Veterans. In a 1933 referendum, the league spearheaded replacement of the parliamentary system with a presidential form of government and laid the groundwork for an April 1934 presidential election, which it expected to win. Alarmed by the prospect of a league victory and possible fascist rule, the caretaker prime minister, Konstantin P�ts, organized a pre-emptive coup d'�tat on March 12, 1934. In concert with the army, P�ts began a rule by decree that endured virtually without interruption until 1940. He suspended the parliament and all political parties, and he disbanded the League of Independence War Veterans, arresting several hundred of its leaders. The subsequent "Era of Silence" initially was supported by most of Estonian political society. After the threat from the league was neutralized, however, calls for a return to parliamentary democracy resurfaced. In 1936 P�ts initiated a tentative liberalization with the election of a constituent assembly and the adoption of a new constitution. During elections for a new parliament, however, political parties remained suspended, except for P�ts's own National Front, and civil liberties were only slowly restored. P�ts was elected president by the new parliament in 1938.

Estonia - The Soviet Era, 1940-85

Although the period of authoritarian rule that lasted from 1934 to 1940 was a low point in Estonian democracy, in perspective its severity clearly would be tempered by the long Soviet era soon to follow. The clouds over Estonia and its independence began to gather in August 1939, when Nazi Germany and the Soviet Union signed the Nazi-Soviet Nonaggression Pact (also known as the Molotov-Ribbentrop Pact), dividing Eastern Europe into spheres of influence. Moving to capitalize on its side of the deal, the Soviet Union soon began to pressure Estonia, Latvia, and Lithuania into signing the Pact of Defense and Mutual Assistance, which would allow Moscow to station 25,000 troops in Estonia. President P�ts, in weakening health and with little outside support, acceded to every Soviet demand. In June 1940, Soviet forces completely occupied the country, alleging that Estonia had "violated" the terms of the mutual assistance treaty. With rapid political maneuvering, the regime of Soviet leader Joseph V. Stalin then forced the installation of a pro-Soviet government and called for new parliamentary elections in July. The Estonian Communist Party, which had only recently reemerged from underground with fewer than 150 members, organized the sole list of candidates permitted to run. P�ts and other Estonian political leaders meanwhile were quietly deported to the Soviet Union or killed. With the country occupied and under total control, the communists' "official" electoral victory on June 17-18 with 92.8 percent of the vote was merely window dressing. On July 21, the new parliament declared Estonia a Soviet republic and "requested" admission into the Soviet Union. In Moscow, the Supreme Soviet granted the request on August 6, 1940.

For all the ups and downs Estonia's independent government experienced during the interwar period, its termination by Stalin in 1940 was clearly not among the range of solutions favored by most Estonians. Yet, chances of holding off the Soviet onslaught with an army numbering about 15,000 men were slim at best. Thus, Estonia's only real hope for the future lay in continued Western recognition of its de jure statehood, which other European countries and the United States declared in 1940. Over the next fifty years, this Western policy of token recognition nearly fell into desuetude. Yet, the policy's survival into the late 1980s would allow it to become a rallying point for Estonia's new drive for independence. Thanks to this continuing Western recognition, Estonia's calls for sovereignty from Moscow by early 1990 could not be considered merely secessionism. Rather, they represented demands for the restoration of a state still existent under international law. This appeal to international legality dating to 1940 would frustrate the attempts of Soviet leader Mikhail S. Gorbachev to control Estonia and the other Baltic states in the late 1980s.

Estonia's absorption into the Soviet Union as the Estonian Soviet Socialist Republic was interrupted in June 1941 by the German invasion. Still, that one year of Soviet rule left a deep mark on the Estonians. In addition to the takeover of their country and the rapid nationalization of their capitalist economy, on June 13-14, 1941, before the German invasion, Estonians also saw the mass deportation of some 10,000 of their countrymen to Siberia. Of those seized during the one-night operation, over 80 percent were women, children, or elderly people. The purpose of this action seemed to be to create terror rather than to neutralize any actual threat to the regime. The 1941-44 German occupation witnessed more repression, especially of Estonia's Jewish population, which numbered about 2,000. In September 1944, as the Red Army again neared Estonia, the memories of Soviet rule resurfaced vividly enough to prompt some 70,000 Estonians to flee the country into exile. These �migr�s later formed ethnic communities in Sweden, the United States, Canada, Britain, Australia, and elsewhere, continuing to lobby for Estonia's rights during the next fifty years. Altogether, from 1939 to 1945 Estonia lost over 20 percent of its population to the turmoil of Soviet and German expansionism.

After the war, the Sovietization of Estonia resumed. The republic's war-ravaged industry was rebuilt as a component of the centrally planned economy. Agricultural collectivization was enforced, climaxing in March 1949 with another, more brutal wave of deportations involving some 25,000 people. The Estonian Communist Party was purged in 1950 of many of its original native leaders; they were replaced by several prominent Russified Estonians who had grown up in Russia. After Stalin's death in 1953, Nikita S. Khrushchev's liberalization also touched Estonia. Efforts at economic reform were undertaken, and repression was eased. By the late 1960s, consumerism had taken root, and intellectual life was relatively vibrant. Following the Soviet Union's suppression of Czechoslovakia's "Prague Spring" reform movement in 1968, the trend toward openness suffered a reversal, but Estonia continued to maintain a standard of living well above the Soviet average. In 1980, during the period of stagnation under Soviet leader Leonid I. Brezhnev, some 2,000 schoolchildren demonstrated in the streets of Tallinn against a major Russification campaign launched from Moscow. Several dozen Estonian intellectuals later came together to write their own protest letter, but to no avail. Karl Vaino, the Russified Estonian leader of the Estonian Communist Party at the time, was particularly hostile toward dissent of any kind.

Estonia - The Pursuit of Independence, 1985-91

On the night of August 19, 1991, Estonia was caught up in the uncertainty generated by the attempted coup in Moscow. A column of Soviet light tanks and troop carriers had already started to move on Tallinn as the commander of Soviet forces in the Baltics announced his support of the coup. Fearing a total crackdown by the Soviet army, the Estonian parliament met in emergency session on August 20. At 11:00 P.M., the Supreme Council, as the legislature was now known, passed a final resolution declaring full independence and requesting de facto international recognition. Volunteers were mustered to defend key government buildings and communications centers; there was no bloodshed, however. As Heinz Valk, an artist and a member of parliament, later declared, "The coup in Moscow [gave] us a chance comparable to that in 1918."

Once the coup finally collapsed, Estonia resumed its efforts to gain international recognition and otherwise reestablish itself as an independent state. Iceland was the first to acknowledge Estonian independence, on August 22; Yeltsin's Russia was quick to follow, on August 24. The United States hesitated until September 2. The Soviet Union recognized Estonia on September 6. The process of state building also began soon after the coup. In contrast to Latvia and Lithuania, Estonia, in its August 20 independence declaration, took the additional step of convening a constitutional assembly immediately to draft a new basic law for the country. The assembly drew thirty members each from the Supreme Council and the Congress of Estonia, thus defusing rivalries between the two organizations. In mid-October the assembly settled on a working draft focused on a generally parliamentary form of government. Deliberations then slowed as the country got caught up in debates over citizenship.

In Estonia's fight to regain independence, the overall strategy of asserting the country's legal continuity as a state clearly had paid off. Yet, in terms of offering a path for the future, this strategy had many complications. One of these was the question of what to do with the 500,000 mostly Russian, Soviet-era immigrants living in Estonia. In 1990 the Congress of Estonia had been the first representative body to lay down the principle that because these people had settled in Estonia under Soviet rule, they were not automatically citizens of the legally restored Estonian state. Rather, under independence they would have to be "naturalized" on the basis of specific language and residency criteria. This position was also argued as a means of better integrating the mostly Russian noncitizen population, the majority of whom did not speak Estonian. In mid-1991, as the independence struggle seemed to languish, the Estonian government, led by Prime Minister Edgar Savisaar, showed signs of readiness to compromise on the citizenship issue in order to gain more local Russian support. However, after the failed August coup and the immediate onset of full independence, the Congress and other radical groups were emboldened to insist on the principle of restricted citizenship. Thus, the Supreme Council decided on November 11, 1991, to require the naturalization of all Soviet-era immigrants to Estonia while automatically renewing the citizenship of all prewar citizens and their descendants. In February 1992, the parliament set naturalization terms, which included a two-year residency requirement, the ability to speak conversational Estonian, and a one-year waiting period after applying.

Although these terms were relatively mild, the implications in Estonia's particular situation remained less than clear. Most Soviet-era immigrants had already fulfilled the residency requirement, but at best only 20 percent were prepared to meet the language requirement. Most Russians living in Estonia had not bothered to learn the rudiments of the national language, forcing Estonians to speak Russian to them instead. It would take time for many to begin learning. In any case, the naturalization procedures would delay nationalization for at least the one-year waiting period. This outcome had serious implications because the resident Russians would then be ineligible to vote in the September 1992 elections for a new parliament. As the only consolation to noncitizens, the Constitu-tional Assembly later accorded them the right to vote in local elections under the terms of the new constitution.

The citizenship issue generally heightened tensions between Estonians and Russians. The more nationalistic Estonian deputies in parliament began to accuse the moderate government of Savisaar of foot-dragging. In January 1992, in the midst of a severe economic crisis and problems securing heating oil, Savisaar asked parliament for emergency powers. When the vote on emergency powers was taken on January 16, Savisaar won, thanks only to the votes of several Russian deputies. This narrow margin revealed the extent of Savisaar's unpopularity among the Estonian deputies, and a week later he resigned. Savisaar's transportation minister, Tiit V�hi, was charged with forming a new government, which was billed as one of technocrats and caretakers in advance of parliamentary elections in the fall.

As V�hi formed his regime, several major issues remained outstanding. The new prime minister's first task was to oversee the passage of the naturalization requirements for citizenship, which occurred in late February. Then, the language and residency requirements were put into effect. Thereafter, the draft constitution drawn up by the Constitutional Assembly neared completion and required approval by popular referendum. This referendum was set for June 28, 1992, with only citizens allowed to participate. Alongside the proposed constitution, a second question asked the people whether to allow the earliest applicants for citizenship to vote on an exceptional basis in the upcoming nationwide elections. Because these applicants numbered just over 5,000, the gesture would be largely symbolic. However, a strong campaign by nationalist Estonian parties led to the defeat of the measure, 53 percent to 46 percent. The constitution was passed by a 91 percent majority.

On June 20, one week before the referendum, the V�hi government completed its third remaining task: currency reform. On that day, Estonian residents proudly cashed in their old, worn Russian rubles for crisp, new Estonian kroons (for value of the kroon--see Glossary). The kroon, pegged to the stable deutsche mark, would soon bring inflation tumbling down and serve as the basis for a new economy (see Economy, this ch.).

With the constitution approved and a new state structure in place, the campaign began for Estonia's first post-Soviet elections. The election of a new legislature, the Riigikogu, on September 20 would mark the full restoration of the legal Republic of Estonia. On October 5, 1992, in its first session, the Riigikogu, which replaced the transitional Supreme Council, issued a declaration establishing its legal continuity with the prewar republic and declaring an official end to the transition to independence announced two-and-one-half years earlier.

Estonia - Geography

Geographic Features

Estonia is a low, flat country covering 45,226 square kilometers. It is about the size of Vermont and New Hampshire combined. Estonia has a long, shallow coastline (1,393 kilometers) along the Baltic Sea, with 1,520 islands dotting the shore. The two largest islands are Saaremaa (literally, island land), at 2,673 square kilometers, and Hiiumaa, at 989 square kilometers. The two islands are favorite Estonian vacation spots. The country's highest point, Suur Munam�gi (Egg Mountain), is in the hilly southeast and reaches 318 meters above sea level. Estonia is covered by about 1.8 million hectares of forest. Arable land amounts to about 926,000 hectares. Meadows cover about 252,000 hectares, and pastureland covers about 181,000 hectares. There are more than 1,400 natural and artificial lakes in Estonia. The largest of them, Lake Peipsi (3,555 square kilometers), forms much of the border between Estonia and Russia. Located in central Estonia, V�rtsj�rv is the second-largest lake (270 square kilometers). The Narva and Emaj�gi are among the most important of the country's many rivers.

Estonia has a temperate climate, with four seasons of near-equal length. Average temperatures range from 16.3�C on the Baltic islands to 17.1�C inland in July, the warmest month, and from -3.5�C on the Baltic islands to -7.6�C inland in February, the coldest month. Precipitation averages 568 millimeters per year and is heaviest in late summer.

Estonia's land border with Latvia runs 267 kilometers; the Russian border runs 290 kilometers. From 1920 to 1945, Estonia's border with Russia, set by the 1920 Tartu Peace Treaty, extended beyond the Narva River in the northeast and beyond the town of Pechory (Petseri) in the southeast (see fig. 2). This territory, amounting to some 2,300 square kilometers, was incorporated into Russia by Stalin at the end of World War II. Estonia is now disputing that territorial loss (see Relations with Russia, this ch.).

Estonia - Environmental Issues

One of the most burdensome legacies of the Soviet era is widespread environmental pollution. The worst offender in this regard was the Soviet army. Across military installations covering more than 80,000 hectares of Estonian territory, the army dumped hundreds of thousands of tons of jet fuel into the ground, improperly disposed of toxic chemicals, and discarded outdated explosives and weapons in coastal and inland waters. In the 1990s, during the army's withdrawal from Estonia, extensive damage was done to discarded buildings and equipment. In October 1993, the Estonian Ministry of Environment issued a preliminary report summing up part of the degradation it had surveyed thus far. The report described the worst damage as having been done to Estonia's topsoil and underground water supply by the systematic dumping of jet fuel at six Soviet army air bases. At the air base near Tapa, site of the worst damage, officials estimated that six square kilometers of land were covered by a layer of fuel; eleven square kilometers of underground water were said to be contaminated. The water in the surrounding area was undrinkable. With Danish help, Estonian crews began cleaning up the site, although they estimated the likely cost to be as much as EKR4 million. The Ministry of Environment assigned a monetary cost of more than EKR10 billion to the damage to the country's topsoil and water supply. However, the ministry was able to allocate only EKR5 million in 1993 for cleanup operations.

In a 1992 government report to the United Nations Conference on the Environment and Development, Estonia detailed other major environmental concerns. For instance, for several consecutive years Estonia had led the world in the production of sulfur dioxide per capita. Nearly 75 percent of Estonia's air pollution was reported to come from two oil shale-based thermal power stations operating near Narva. The mining of oil shale in northeastern Estonia also left gigantic mounds of limestone dotting the region. Near the town of Sillam�e, site of a former uranium enrichment plant, about 1,200 tons of uranium and about 750 tons of thorium had been dumped into the Gulf of Finland. This was said to have caused severe health problems among area residents. In the coastal town of Paldiski, the removal of waste left by Soviet army nuclear reactors was also a major concern. The combined cost of environmental cleanup at both towns was put at more than EKR3.5 billion.

Estonia - Society

According to 1989 census figures, Estonia had a population of 1,565,662 (see table 2, Appendix). By 1994 this number had dropped to an estimated 1,506,927 as a result of negative natural growth rates and net out-migration beginning in 1990. Females outnumbered males by some 100,000 in 1991 (see fig. 4). Seventy percent of the population was urban. The birth rate in 1993 was 10.0 per 1,000 population, and the death rate was 14.0 per 1,000.

Tallinn, the capital, is the largest city, with about 479,000 inhabitants in 1989. Tartu, the second most populous city, had about 113,000 residents in the same year, and Narva, on the Russian border, had 81,000 (see table 3, Appendix). Since the late 1980s, many place-names have had their pre-Soviet names restored. These include the Saaremaa town of Kuressaare (formerly Kingissepa) and some 250 streets throughtout the country.

In 1934 Estonia had a population of 1,126,413. War losses and Soviet deportations brought that figure down to an estimated 850,000 by 1945. During the Soviet era, the population grew steadily, fueled largely by in-migration from other areas of the Soviet Union (see table 4, Appendix). During the 1950s and 1960s, net in-migration accounted for more than 60 percent of the total population growth. In recent years, net migration has reversed, with some 84,000 people, mostly Russians, having left between 1989 and 1993. In the mid-1990s, these trends were continuing, though more slowly. Since 1992 Estonia has been offering financial assistance to people wishing to resettle in Russia; in October 1993, it signed a treaty with Russia regulating repatriation and resettlement. According to public opinion polls conducted in 1993 and 1994, however, the vast majority of local Russians were not inclined to leave Estonia.

The reverse flow of migration is thought to have contributed in the early 1990s to a slight rise in the Estonian proportion of the population. In 1989 Estonians constituted only 61.5 percent of the population, while Russians made up 30.3 percent, Ukrainians 3.1 percent, Belorussians 1.7 percent, and Finns 1.1 percent; Jews, Tatars, Germans, Latvians, and Poles constituted the remaining 2.3 percent. This was in sharp contrast to 1934, when Estonians represented 88.2 percent of the population and Russians only 8.2 percent. This demographic shift was a major concern for Estonians, who feared losing control of their own country. Another worrisome statistic for Estonians was their disproportionately small share of the yearly natural population growth (births minus deaths) until 1990 and their large share of the population's decrease in 1991 (see table 5, Appendix). Although Estonians dominate in the countryside, the Russian population in Estonia is nearly 90 percent urban, living mainly in Tallinn and in the northeastern industrial towns of Kohtla-J�rve, Sillam�e, and Narva. Tallinn is about 47 percent Estonian. Kohtla-J�rve is only about 21 percent Estonian, Sillam�e 5 to 6 percent, and Narva 4 percent.

Estonia - Health

In the mid-1980s, the average life expectancy in Estonia peaked at about sixty-six years for males and seventy-five years for females. Thereafter, these figures declined somewhat, especially for males, most likely because of deteriorating living standards. In 1994 overall life expectancy was estimated to be 70.0 years (65.0 years for males and 75.2 years for females). Infant mortality was about 19.1 deaths per 1,000 live births, according to a 1994 estimate. Fertility rates dropped from an estimated 2.3 children born per woman in 1988 to about 2.0 in 1994. Abortion remained the main form of birth control, more so among Russians than Estonians. There were 24,981 abortions in 1992 (1,389 per 1,000 live births), although that figure was down from about 36,000 a decade earlier. Most women who have abortions are married. Nearly half of all marriages end in divorce. In recent years, a greater number of people have begun living together instead of marrying. Such couples account for 17 percent of all births in the country.

The primary cause of death is cardiovascular diseases, accounting for about 64 percent of all deaths in the mid-1990s. Cancer and accidents account for a large share as well. Estonia's suicide rate over the years has reflected the country's sociopolitical condition. In the mid-1970s, during the politically stagnant Brezhnev years, there were about 530 suicides per year. In 1990, after Estonia's political reawakening, suicides dropped to 425. In 1992, as economic conditions worsened, suicides climbed again, to 498. In November 1993, twenty-nine cases of acquired immune deficiency syndrome (AIDS) were reported in Estonia, with two deaths having resulted from AIDS-related illnesses.

The state-run health care system inherited from the Soviet regime was being decentralized in the early 1990s and had yet to meet Western standards. In 1992 the number of physicians, equivalent to thirty-two per 10,000 inhabitants, was relatively high, but there was a shortage of nurses and other auxiliary medical staff. Hospital beds numbered ninety-two per 10,000 inhabitants, down from 121 in 1990. Although the cost of medicines increased, new imports from the West eased some of the chronic shortages of the Soviet era. But overall, shortages of basic medical supplies, including disposable needles, anesthetics, and antibiotics, remained a serious problem.

Estonia - Welfare

In 1990 and 1991, Estonia began taking over more of the administration of its social welfare system from the central Soviet authorities. The government instituted its own system of payments, for example, to compensate the population for the removal of state subsidies and an increase in food prices. In April 1991, the republic passed its own pension law, the implementation of which was upset by inflation, although later the situation improved with the introduction of a new currency. Still, with some 307,000 pensioners and a rapidly aging population, pensions accounted for a large share of the country's social fund (see Recent Economic Developments, this ch.). In response, the government began gradually raising the retirement age from fifty-five for women and sixty for men to sixty for women and sixty-five for men. In January 1993, more than 1,000 angry retirees staged a protest in front of Toompea Castle to demand higher pensions. At EKR260 a month, pensions were so low that many people complained that they could barely pay their rent and utility bills.

Other welfare benefits provided by the state included financial support for invalids, low-income families, and families having three or more children. The state also provided institu-tional care for elderly people and orphans.

Estonia - Education

With a half-century of Soviet rule behind it, independent Estonia began a process of thorough educational reform. In addition to a restructuring of curricula, the government began a reorganization of the secondary school system with the goal of increasing specialization among the country's high schools. In 1993 there were some 215,000 elementary and secondary school students in 724 schools across Estonia. About 142,000 students were enrolled in Estonian-language schools and about 70,000 in Russian-language schools, mainly in Tallinn and northeastern Estonia. In addition, there were individual schools teaching in other minority languages, including Hebrew, Swedish, and Ukrainian. Estonian-language schools offer twelve years of education--nine elementary and three secondary. Education in Russian-language schools lasts eleven years. Under a 1993 law, education was made compulsory up to the ninth grade. Estonia's vocational education network is also extensive, with seventy-seven schools across the country and about 26,000 students in 1993. Literacy is nearly universal.

Estonia's system of higher education centers on six universities. Tartu University, founded in 1632, is the country's largest, with about 7,600 students in 1993. The Tallinn Technical University had about 6,800 full-time students in 1993, and the Tallinn Pedagogical University had about 3,150. The Estonian Agricultural University in Tartu had about 2,800 students, and the Tallinn Art University and the Estonian Academy of Music each enrolled about 500.

Higher education was restructured in the early 1990s into a four-year system after the five-year Soviet system was dropped. A new degree structure comparable to the Western one of baccalaureate, master's, and doctoral degrees was established. Soviet ideological subjects such as "scientific communism" were abandoned soon after the independence movement began in 1988. With the help of exchange programs and guest lecturers from the West, new programs were begun in economics, business, foreign languages, religion, political science, and sociology.

Estonia - Religion

The dominant religion in Estonia is Evangelical Lutheranism. Estonians were Christianized by the Teutonic Knights in the thirteenth century. During the Reformation, Lutheranism spread, and the church was officially established in Estonia in 1686. Still, Estonians generally tend not to be very religious, because religion through the nineteenth century was associated with German feudal rule. In 1992 there were 153 Lutheran congregations in Estonia with an estimated 200,000 members. Active members totaled about 70,000.

The Estonian language belongs to the Finno-Ugric family of languages, closely related to Finnish and more distantly related to Hungarian. It is among the most difficult languages in Europe, with fourteen cases for the declension of nouns and complicated rules for their use. There are no articles, however, nor any grammatical gender in Estonian. Indeed, the same word is used for both "he" and "she": tema . Over the years, the language has been standardized, but many dialects and accents remain, especially on the islands. Most of the foreign words used by Estonians come from German. Russian, Finnish, and English also have influenced Estonian, especially in the formation of slang.

Estonian culture developed in earnest during the nineteenth-century period of national awakening. Elements of Estonian peasant culture, such as songs and folktales, were brought together by the country's first cultural elite after 1850. Between 1857 and 1861, Friedrich Reinhold Kreutzwald compiled and published the Estonian national epic, Kalevipoeg (Son of Kalev), which was based on various folklore themes. Written in verse, the epic tells the story of Kalevipoeg, the mythical ancient ruler of Estonia. Another achievement of this period was the establishment of Estonia's first regularly published Estonian-language newspaper, Perno Postimees , originally published in P�rnu by Johann Voldemar Jannsen in 1857. In 1878 Carl Robert Jakobson established the newspaper Sakala , which would soon become a major promoter of the cultural renaissance. Jakob Hurt, a schoolteacher and Lutheran minister, organized a collection of folk songs in the 1880s and gave several speeches extolling the value of Estonian culture.

The national literature had an earlier beginning, in the 1810s, with the patriotic poetry of Kristjan Jaak Peterson. In the second half of the nineteenth century, romanticism and love of country found equal expression in the poetry of Lydia Koidula, Estonia's first woman poet and a key figure of the cultural awakening. The first Estonian song festival was organized in 1869 in Tartu, attracting some 800 participants and about 4,000 spectators. This event would become a major tradition in Estonian cultural life and was held roughly every five years. At the end of the nineteenth century, Estonian theater also got its beginnings in Tartu with the formation of the Vanemuine theater group.

During the first independence period, Estonian culture thrived. During 1926-33 writer Anton Hansen Tammsaare published his five-volume epic novel, T�de ja �igus (Truth and Justice), which covered the period 1870-1930. Lyrical poetry grew with the works of Marie Under, Henrik Visnapuu, and Betti Alver. In 1919 the Pallas art school was founded in Tartu, giving rise and expression to several new artistic currents. Architecture became a new mode of expression for Estonians as the first architects were educated in Tallinn. Their works came to include the parliament building on Toompea Hill and several functionalist buildings in the resort town of P�rnu. The Estonian Drama Theater was established in 1926, complementing the already existing Estonia Theater, which featured operettas and ballet. By 1940 Estonia had eleven professional or semiprofessional theaters.

The return of the Red Army in 1944 after the German occupation caused much of Estonia's cultural elite to flee the country. Many writers and poets settled in Sweden, where they continued to issue works through their own publishing cooperative. Under Stalin, Estonian culture was subordinated to the propagandistic needs of the regime. In 1950, as the Estonian Communist Party was being purged, so too was Estonian culture. Many writers and artists were accused of "formalism" (adherence to bourgeois standards) or nationalism and were dismissed or deported. It was only in the 1960s, during the thaw under Khrushchev, that Estonian culture regained vibrancy, the result of increased foreign contacts and the arrival on the scene of a new generation of writers, artists, composers, and poets. The last category included Paul-Eerik Rummo (appointed minister of culture in 1992), Jaan Kaplinski (elected a member of parliament in 1992), and Hando Runnel. Novelist Jaan Kross made his debut during this period as a writer of historical works; his 1978 book, The Czar's Madman , was published in English in 1993 to critical acclaim. Graphic art became popular in Estonia during the 1960s, as did abstractionism among painters. The Estonian music scene saw the coming of age of Arvo P�rt, who would emigrate in 1980 to West Germany; Veljo Tormis, a composer drawing on themes from Finno-Ugric folk music; and Neeme J�rvi, who emigrated in 1980 and later became director of the Detroit Symphony Orchestra. Song festivals still were held continuously, often providing a popular outlet for national feeling. In the place of the banned national anthem, the song My Fatherland Is My Love , based on a poem by Lydia Koidula and music by composer and conductor Gustav Ernesaks, became Estonians' de facto an-them.

During the late 1970s and early 1980s, Estonian culture again felt some of the cold drafts of official control, but by 1986 the influence of glasnost began to stir cultural activity anew, this time far into the realm of politics. One of the first groups to mobilize in 1987 was the Estonian Heritage Society, which led volunteer projects to restore many of Estonia's cultural landmarks. At a 1986 writers' conference, the first complaints were publicly aired about censorship and Russification. In the main literary publications--Sirp ja Vasar , Vikerkaar , and Looming --an unprecedented number of articles began to appear dealing with hitherto banned topics. In April 1988, during a two-day public forum, nearly fifty of Estonia's most prominent cultural figures met to voice their concerns about the state of Estonia's culture, language, and people. Open criticism was leveled against the old-guard party leadership of Karl Vaino, and demands were made for real political reform. The forum was an awe-inspiring event for the hundreds of thousands of Estonians who listened on radio; yet it was only a prelude to the "singing revolution" that would follow that summer.

During the next several years, many of Estonia's artists, poets, and writers would become involved in politics. Thirteen cultural figures were elected to the Supreme Soviet in 1990, nearly twenty to the Riigikogu, the new legislature, in 1992. Culture suffered, however, because of economic decline. Paper shortages in 1990 and 1991 limited the number of books and literary journals that could be published. Art supplies, in high demand, often were available only in exchange for hard currency. Still, foreign contacts opened up completely with opportunities to view new creative works and to spread Estonian culture abroad. With independence again in hand, Estonia could look forward to another era of free cultural development in a common European home.

Estonia - Economy

Estonia's transition to a free-market economy in the early 1990s reflected the difficulties of building an independent economy from the ruins of one that hitherto had been developed for a single market, that of the Soviet Union. The creation of new economic institutions such as a separate monetary system, new regulatory agencies, and new development strategies had to keep pace with the decline of the old economy and its institutions. Real gross domestic product (GDP--see Glossary) dropped continuously in the early 1990s (see table 6, Appendix). Yet, among the former Soviet republics, in roughly four years of far-reaching market reforms Estonia became a model of economic transformation. The right-of-center government of Mart Laar, which took office in 1992, maintained a promarket stance despite criticism from opposition parties and agricultural interests, which were most vulnerable to foreign competition. After the introduction of the kroon in June 1992, inflation fell rapidly to an average of less than 3 percent per month in 1993. Consumer goods were again in abundant supply. Foreign trade grew, although in 1993 the trade balance began to show deficits. Under a program of privatization, 80 percent of the country's state-owned small businesses were sold off, and three rounds of large-scale privatization with foreign participation resulted in the acquisition of thirty major enterprises. By January 1995, after several more rounds of privatization, only twenty large enterprises had yet to be privatized. Official unemployment dropped to 1.4 percent in November 1994, but real unemployment may have been as high as 10 percent. The squeeze on the economy and the state budget intensified as many large, privatized firms were downsized and the transition neared the decisive stage of open competition.

Estonia - Economic Reform History

Estonia began its reform process in 1987 with the development of a plan for economic autonomy within the Soviet Union. Drawing on examples from both China and Hungary, the radical proposal called for an end to central economic control over Estonia, a separate tax system, and the adoption of a convertible ruble. Until then, it had been said that as much as 90 percent of the Estonian economy was controlled from Moscow; very little was left for the Estonians to decide for themselves. The decline in living standards beginning in the early 1980s and the "years of stagnation" were viewed as direct consequences of this overcentralization. With Gorbachev calling for a "restructuring" (or perestroika ) of the economy, the Estonian proposal was meant to respond to and test this new call for change. The idea was popular among Estonians, not least of all because of the plan's name, Isemajandav Eesti, whose acronym, IME, also means "miracle" in Estonian.

Despite initial resistance from the old-guard Estonian Communist Party leadership, IME became official policy soon after the appointment of native-born Vaino V�ljas as first secretary of the party in June 1988. Teams of economists were put to work mapping out the laws and decrees that would enable the plan to begin by January 1, 1990. Much of this work would improve Estonians' knowledge of reform economics by the time more radical measures proved necessary. In May 1989, the Estonian Supreme Soviet approved the plan by an overwhelming majority, sending it on to the Supreme Soviet in Moscow. Kremlin bureaucrats, however, sought to water down the scheme, injecting contradictory clauses that would make the plan unworkable. While the final law passed by the Soviet parliament accorded economic autonomy to Estonia, along with Latvia and Lithuania, it also stipulated that all reform measures be in accord with central Soviet laws.

In the following months, as the popular mood in Estonia shifted toward full independence, it became clear that the IME plan, too, would get nowhere within the increasingly outdated Soviet system. Still, many of the details and general impetus of IME proved very useful for economic reform down the road. In December 1989, the Estonian Supreme Soviet voted to create a central bank, the Bank of Estonia, for the republic as part of the plan for an eventual Estonian currency. Price-reform policies were in full force by October 1990, and an independent law on foreign trade was adopted. Prime Minister Edgar Savisaar sought to broaden Estonia's economic contacts with other Soviet republics, organizing several economic summits in Tallinn with Central Asian and Caucasian leaders. A new tax system was put in place in Estonia, replacing the state budget's dependence on enterprise turnover taxes and phasing in income and sales taxes. In short, economic reform simply was carried out without regard to the Kremlin.

By August 1991, with Estonia's leap to full independence, the economy was beginning to feel the pain of both market reform and collapsing ties to the Soviet Union. Gasoline shortages had been endemic since 1990, and many enterprises were forced to cut production because of a lack of raw materials previously imported from other Soviet republics. Lax Soviet monetary policy also fueled Estonian inflation, undermining reform efforts as long as the new country remained in the Russian ruble zone. An unprecedented fuel and food shortage in January 1992 prompted Prime Minister Savisaar to ask parliament for emergency powers to deal with the crisis. Deputies in parliament, however, had lost confidence in Savisaar, and in the ensuing political crisis he was forced to resign. Savisaar was replaced by his transportation minister, Tiit V�hi.

A temporary fuel loan from Finland helped stabilize the situation, but the need to hasten the introduction of Estonia's own currency became apparent. Other economic reforms such as privatization and foreign trade were also being held up by the country's dependence on the Russian ruble.

On June 20, 1992, against earlier objections from the International Monetary Fund (IMF--see Glossary), Estonia introduced its new currency, the kroon. With only US$120 million in gold reserves and no internationally backed stabilization fund, Bank of Estonia president Siim Kallas said the country could wait no longer. At 800 exchange points across the country, residents were allowed to exchange up to 1,500 rubles at a rate of ten rubles to one kroon. Excess cash was exchanged at a rate of fifty to one. Bank accounts were converted in full at ten to one. By the end of the three-day transition period, the move was declared a success, with only minor glitches reported. For stability, the kroon was pegged by special agreement to the deutsche mark (DM) at EKR8 = DM1. This would make the kroon worth about 7.7 United States cents, or EKR13 = US$1. The kroon would be the only Baltic currency to be officially pegged to any outside value.

Estonia - Economic Developments

Monetary and Fiscal Policy

The new Estonian currency became the foundation for rational development of the economy. Money began to have clear value; the currency supply could be controlled from Tallinn, not Moscow; and long-term investment decisions could be made with greater confidence by both the state and private enterprise. The president of the central bank, Siim Kallas, made "hard money" the benchmark of his policy. In return, the bank saw its reserves grow rapidly, to US$184 million by the end of 1992 and US$365 million by December 1993. The central bank was independent of the government but subordinate to the parliament. In addition to its president, the bank was managed by a board of directors, whose chairman was also appointed by parliament.

Although the initial success of the kroon was gratifying, many fiscal challenges remained that threatened to upset monetary policy in the future. Among these was a high enterprise tax debt to the state. In December 1992, this debt, mostly unpaid revenue taxes from large state firms, amounted to about EKR565 million. A year later, this sum had fallen to roughly EKR400 million, but the possibility that the state might need to use its own funds to bail out these ailing firms remained. Another danger to monetary stability was posed by the possible collapse of several private banks in Estonia. In November 1992, the Bank of Estonia ordered the shutdown of three private banks because of insolvency. One of these was the Tartu Commercial Bank, which in 1988 had become the first private bank to be founded in the Soviet Union. Bad loans, increased competition, and poor management were expected to force other bank closures, with which the state would have to deal.

Following the enactment of reform laws during 1989-90, the state budget in Estonia was broken into three parts: the central government budget, local government budgets, and nine extrabudgetary funds. In 1993 (the first year for which figures are provided entirely in kroons), the central state budget ran a surplus of EKR216 million on total revenues of roughly EKR4.2 billion (US$323 million). This surplus, however, was immediately spent in a secondary budget drawn up in October. The central budget included the financing of government operations (ministries, schools, police, cultural subsidies, and so forth) as well as roughly EKR500 million in aid to cities and towns. About half of the revenue for the central budget came from an 18 percent value-added tax (VAT--see Glossary) on most goods and services. Another 35 percent came from personal income and business taxes. Social welfare taxes on employer payrolls went directly into the state's extrabudgetary social welfare and health insurance funds, which amounted to slightly more than EKR2 billion. In all, general government taxes (including local taxes) in 1991 amounted to about 47.7 percent of GDP. Although successive governments pledged to reduce the overall tax burden, the transition was slow. In 1994 the previous three-tiered progressive tax scale was replaced with an across-the-board income tax rate of 26 percent. Estonia's central budget in 1995 was expected to total EKR8.8 billion, exceeding the 1994 budget and its supplements by EKR2.3 billion, mainly because of additional expenditures on social welfare, the civil service, the police, and the border guard. It was to be a balanced budget, nonetheless, for the second consecutive year. Various forms of taxation, including the income tax, an 18 percent VAT, and a corporate tax were to provide most of the revenue.

Wages and Prices

After the beginning of economic reform in Estonia, real wages dropped precipitously. From the fourth quarter of 1989, when the first price rises began, to the third quarter of 1991, when Estonia became independent, real wages fell by more than half. Food prices rose an estimated sevenfold as state subsidies were eliminated and the population received only partial government compensation for the higher prices. Fuel prices and apartment rents also increased. Inflation soared even more after independence as trade with Russia broke down even though Estonia remained in the ruble zone. In January 1992 alone, the cost-of-living index rose 88 percent, and in February it rose another 74 percent. The average rate for the year was 1,000 percent according to some estimates. Nominal monthly wages skyrocketed to keep pace, rising from 648 rubles in May 1992 to 3,850 rubles by May 1993.

The introduction of the kroon in June 1992 did much to stabilize wages and inflation. In 1993 increases in the consumer price index averaged about 3.0 percent per month; in 1994 they averaged 3.5 percent per month. The average monthly wage settled around EKR500 in August 1992. Thereafter, it began a steady climb, reaching roughly EKR1,200 by the end of 1993. Yet, according to Arvo Kuddo, an official of the Bank of Estonia, real wages in mid-1993 still amounted to only 95 percent of their June 1992 levels and barely 50 percent of their levels from early 1991. In the meantime, wage differentials between the highest- and lowest-paying jobs grew markedly, from 3.4 times to ten times. According to the Estonian State Statistics Board, in mid-1993 the top 10 percent of wage earners received 32.9 percent of all income, while the bottom 10 percent received only 2.1 percent. Residents of Tallinn had the highest average monthly wage, some 20 percent above the national average. Personal savings also declined during this period. In December 1992, 41 percent of survey respondents said they had no significant savings at all. In 1993 some 17 percent said they were behind in paying their utility bills for lack of money.

Employment

The complexion of the Estonian labor market changed rapidly in the early 1990s in the wake of property reform and the growth of private enterprise. In 1990 some 95 percent of the labor force was employed in state-owned enterprises or on collective farms. Only 4.3 percent worked in private cooperatives or on private farms. In 1993 a public opinion survey indicated that less than half of the respondents now received their main income from a state enterprise. As privatization continued and the privately owned share of production increased, the share of state employment was expected to drop even more. Industry (in both the public and the private sectors) employed about 33 percent of workers in 1990; agriculture, 12 percent; education and cultural activities, 10 percent; construction, 10 percent; and trade and catering, 9 percent. The remainder of the labor force engaged in a variety of other activities in the services sector (see table 7, Appendix).

As of December 1, 1993, Estonia's official unemployment rate was still very low, 1.7 percent, or 14,682 people. This figure represented the proportion of working-age people officially registered as unemployed with the government's Employment Board and hence receiving unemployment benefits. During the second half of 1993, unemployment had in fact steadily declined from a high of 22,699 in May. In addition, the number of people on unpaid or partially paid leave declined during the first half of the year. By contrast, however, more people were reported working part-time, most often with their full-time workweek having been reduced to three or four days. These people were not included in the official figure. The highest official unemployment rates in December 1993 were in the towns of the southeast (V�ru, 5.3 percent; P�lva, 4.8 percent) and the northeast (Narva, 4.4 percent). Tallinn posted the lowest unemployment rate (0.2 percent), with just 594 registered jobless people. In 1994 official unemployment peaked at 2.3 percent in April, then fell steadily to a rate of 1.4 percent in November, the lowest rate among the Baltic states.

The official unemployment figures, however, did not tell the whole story. The unemployment rate was based on the working-age population (about 880,000 people), not the smaller number of active persons in the population (about 795,000). In addition, the figure did not include unregistered jobless people. In general, the low level of unemployment benefits also discouraged many people from even registering as unemployed. In October 1992, unemployment benefits in Estonia were reduced from 80 percent to 60 percent of the minimum monthly wage. Benefits were paid for 180 days with the possibility of a ninety-day renewal. In 1993 the government allocated EKR90 million for an expected 40,000 unemployed but ended up disbursing only EKR30 million because of the low number of registered jobless people. Still, in the final quarter of 1993, the Economist Intelligence Unit estimated that the real level of unemployment was as high as 10 to 12 percent.

Foreign Trade

An integral part of Estonia's transition to a market economy during the early 1990s involved reorienting foreign trade to the West and attracting foreign investment to upgrade the country's industry and commerce. In 1990 only 5 percent of Estonia's foreign trade was with the developed West, and of this, only 21 percent represented exports. About 87 percent of Estonia's trade was with the Soviet Union, and of that, 61 percent was with Russia. In 1991 trade with Western and other foreign countries fell further as available hard currency for imports dried up and as many producers of Estonian exports had to cut output because of a lack of raw materials. Although trade with Russia struggled on during the first half of 1991, trade relations broke down after independence was attained in August. New agreements were signed in December 1991, but precise licensing procedures and bilateral trade quotas took several more months to work out. This delayed shipments of fuel and raw materials to Estonia, causing a severe economic crisis.

The introduction of the Estonian kroon in June 1992 proved decisive in stabilizing foreign trade. By the third quarter of 1992, Estonia experienced strong growth in foreign trade, finishing the year with an EKR136 million surplus. The total volume of trade amounted to nearly EKR11 billion, two-thirds of that coming during the second half of 1992. Moreover, by the end of the year, the very structure of Estonia's foreign trade had begun to change. European countries accounted for 56 percent of Estonia's trade in 1992. While 28.4 percent of Estonia's imports continued to be from Russia, 22.6 percent now came from Finland. In 1993 Finland surpassed Russia as a source of Estonia's imports, 27.9 percent to 17.2 percent. The two countries were roughly equal as a destination for Estonian goods, both accounting for just above 20 percent in 1992 and 1993 (see table 8, Appendix). Textiles constituted Estonia's leading trade article in 1992, accounting for 14 percent of exports. Among imports, Estonia primarily continued to receive mineral products (27.2 percent) and machinery and equipment (18.3 percent) (see table 9, Appendix).

In 1993 Estonia ran a trade deficit estimated at US$135 million. The trade balance deteriorated partly because of the strength of the kroon and partly because of a growing need for automobiles, agricultural products, and other essential goods. There was a 131 percent increase in imports from 1992 to 1993, compared with a 91.8 percent increase in exports. This imbalance was offset by a strong increase in services, leaving the country's current account in the black at EKR493 million. The trade deficit, however, continued to swell, reaching an estimated US$389 million in 1994.

Foreign Investment and Loans

Foreign investment in Estonia began during 1987-88 with the creation of several dozen joint ventures under the Soviet Union's early reform strategy. The number of joint ventures in Estonia grew steadily after April 1990, when Estonian authorities began registering joint ventures themselves. By January 1991, 232 joint ventures had been registered in Estonia; by October 1991, there were 313. Finland led in the number of joint ventures (159), but Sweden accounted for the most foreign capital in Estonia (35 percent). In mid-1990 foreign investment also started coming into Estonia via joint-stock companies--a more flexible form of ownership for both foreign investors and local capital. Joint-stock companies soon surpassed joint ventures as the prime attraction for foreign capital, totaling 803 by October 1991. In fact, many joint ventures later were converted into joint-stock companies. In September 1991, Estonia passed a new foreign investment law offering tax breaks (new ventures were granted a two-year tax exemption) and import-export incentives to foreign investors. This legislation stimulated further activity. In 1993 foreign investors were also given the right to buy land, but only through the purchase of privatized state enterprises. Non-Estonians could not own more than 50 percent of the equity in joint ventures without government permission.

From the beginning, foreign capital was heavily concentrated in Tallinn. About 75 percent of the first joint ventures were established in the capital; in March 1993, it was reported that 87 percent of all foreign capital invested in Estonia was located in Tallinn and the surrounding area. Although the government hoped that lower property taxes and lower wages might eventually entice more foreign capital to southern Estonia, most investors continued to be drawn to Tallinn for its higher-quality communications, better-trained personnel, and broader transportation opportunities.

Among individual countries, Sweden continued to lead all others in both overall value of investments and as a percentage of total foreign investment--37.7 percent in 1993 (see table 10, Appendix). Both the Norwegian company Statoil and the Finnish firm Neste also were heavily involved in the national economy, building gasoline stations across Estonia. Tallinn's premier hotel, Hotel Palace, was owned by the Estonian-Finnish consortium Fin-Est. In 1992 Coca-Cola set up a joint venture with the Estonian bottling plant AS Tallinna Karastus-joogid to produce soft drinks for the Estonian and Russian markets. In 1993 a four-story office building, the Tallinn Business Center, was opened by a United States development group.

Estonia's transition to a market economy during 1991-93 was eased considerably by the availability of more than US$285 million in foreign aid, loans, and credits. Receipt of this financial assistance was facilitated by the fact that Estonia, unlike many of the other countries of Eastern Europe, had no prior foreign debt. In addition, by claiming legal status as a formerly occupied country, Estonia, along with the other Baltic states, refused to accept liability for the Soviet Union's foreign debt. Instead, it claimed--and received the rights to--more than US$100 million worth of Estonian gold deposited in Western banks by the prewar republic and frozen after 1940.

Industry

The Estonian industrial sector suffered more than other sectors during the country's transition to a market economy. Most of Estonia's heavy industry had been developed and managed by central planners in Moscow with imported labor from Russia. In 1990 only sixty-one of 265 industrial enterprises were under direct Estonian control. Forty enterprises, which accounted for 12 percent of Estonia's industrial production, were controlled directly from Moscow. Because many of these were defense related, even Estonian authorities had limited access to them. After independence was regained in 1991, Estonia acquired all of the industrial enterprises on its territory and faced the challenge of finding them a place in a market economy.

In 1990 industry accounted for about 40 percent of GDP (42.5 percent in 1992) and 33 percent of employment. Within the sector, food processing was the largest subsector, accounting for 30.4 percent of production in 1992 (up from 24.5 percent in 1990). It was followed by light industry at 17.9 percent (down from 26.3 percent in 1990) (see table 12, Appendix).

Industrial production began to fall drastically as supplies of raw materials from the Soviet Union dwindled. The World Bank reported that in the first nine months of 1991, industrial activity decreased by 10 percent over the previous year's corresponding period. According to the Estonian State Statistics Board, during 1992 total production fell another 39 percent from 1991. In 1993, as enterprises began slowly buying raw materials on the world market, production in some areas began to increase. Although overall output was still down in 1993, it increased by an estimated 7 percent in 1994. Estonia's best hope lay with its lighter industries: food processing, textiles, furniture, paper, and glass. Many of these relied on domestic raw materials and hence were able to continue producing during the transition. Estonia's metallurgical and chemical industries showed the greatest decline, and their future was in doubt without new technology and markets.

Agriculture

Like the rest of the economy, Estonian agriculture has been in great flux since the degeneration of the collective and state farm systems. In 1991 roughly 12 percent of the labor force was employed in agriculture, producing 15.4 percent of Estonia's GDP. Estonia has some 1.3 million hectares of agricultural land, nearly 1 million hectares of which are arable. During the Soviet era, arable land decreased by nearly 405,000 hectares, much becoming forest. Collectivization in the late 1940s and 1950s brought great hardship to Estonian agriculture, which during the first independence period had been the mainstay of Estonian society. Still, Estonian agriculture remained more productive than the Soviet average. In 1990 there were 221 collective and 117 state farms with an average of 350 to 400 workers each. The average livestock herd per farm included 1,900 cattle and 2,500 pigs. Estonia was a net exporter of meat and milk to the other republics. Agriculture also served as the basis for the republic's strong food-processing industry (see table 13, Appendix). For its meat production, however, Estonia relied heavily on feed grain from Russia. When the republic sought to cut back on meat exports in the late 1980s, Russia retaliated by slowing the provision of feed grain, which cut Estonian production even further. Increases in fuel prices and a general fuel crisis in early 1992 also hit agricultural production very hard. Although the total area of field crops grew in the early 1990s, total production and average yields fell markedly (see table 14, Appendix).

Reform of Estonia's agricultural system began in December 1989 with adoption of the Law on Private Farming. The law allowed individuals to take up to fifty hectares of land for private planting and for growing crops. The land was heritable but could not be bought or sold. The goal of the reform was to stimulate production and return the spirit of private farming to a countryside worn down by decades of central planning. Six months after implementation, nearly 2,000 farms were set up, with several thousand waiting for approval. A year later, more than 3,500 private farms were operating. Starting in October 1991, farmers were allowed to own their land. This boosted the number of farms to 7,200 by early 1992. As of the first half of 1993, a total of 8,781 farms had been created, covering approximately 225,000 hectares, or a quarter of Estonia's arable land.

In May 1993, the Estonian parliament passed a law on property taxes, which had been a major concern for many farmers before getting into business. The law mandated a 0.5 percent tax on property values to be paid to the state and a 0.3 to 0.7 percent share to be paid to local governments. More than property taxes, the costs of commodities such as fuel and new equipment were considered most likely to prove burdensome to many new farmers.

With the introduction of private agriculture, many collective farms began to disintegrate. Corruption and "spontaneous privatization" of farm equipment by farm directors grew. A number of Estonia's more successful farms were reorganized into cooperatives. Over the long term, the government predicted that 40,000 to 60,000 private farms averaging fifty hectares would be optimal. At the same time, Estonians were likely to maintain a very high rate of consumption of home-grown fruits and vegetables. A 1993 survey by the Estonian State Statistics Board indicated that nearly 80 percent of all potatoes consumed by Estonians either were privately grown or were received from friends or relatives. Thirty percent of eggs were received outside the market as well as 71.5 percent of all juice. Overall, Estonians reported getting over 20 percent of their food from private production or from friends or relatives.

Estonia has 1.8 million hectares of forest with approximately 274 million cubic meters of timber. Accounting for about 9 percent of industrial production in 1992, forest-related industries seem likely to grow further in the 1990s, thanks to expanding furniture and timber exports.

The fishing industry, once entirely under Soviet control, also has the potential to contribute to the country's economy. With 230 ships, including ninety oceangoing vessels, this profitable industry operated widely in international waters. A large share of Estonia's food-industry exports consists of fish and fish products. In 1992 about 131,000 tons of live fish were caught.

Energy and Natural Resources

Estonia is an exporter of electrical energy, but it is wholly dependent on the outside market for oil fuels and natural gas. Oil shale deposits estimated at 5 billion tons in the country's northeast help to fuel two large thermal power plants near the town of Narva (see fig. 5). Roughly 23 million tons of oil shale were mined per year up to the early 1990s. In 1990 Estonia produced about 17.2 billion kilowatt-hours of electricity, of which about 8.5 billion were exported to Russia and Latvia. By 1992, however, export production of electricity had dropped by more than one-half because of falling demand in Russia. These cutbacks in turn forced a slowdown in oil-shale mining, although no exact figures were available. In many mines, miners were employed only three or four days per week. The decline in tonnage also increased relative production costs. In order to start bringing Estonian oil shale closer to world prices and to cover costs, mining officials called in 1993 for an increase in the state price per ton from EKR36 to EKR50. The government resisted at first, fearing a corresponding rise in electricity prices and a new wave of inflation throughout the economy but eventually allowed oil shale producers to raise the price of their products to EKR45 per ton.

After independence, Estonia endeavored to sign barter agreements with Russia to exchange Estonian electricity and food for Russian oil and gas. Transportation problems in Russia caused this arrangement to break down in early 1992. The ensuing fuel shortages forced Estonia to venture onto the open market for the first time. In the interim, Russian oil prices began to approach the world price, meaning Estonia would find it just as competitive to begin buying fuel from other countries. In March 1993, two new oil terminals were opened near Tallinn, which will facilitate imports in the future. Foreign companies, such as Finland's Neste and Norway's Statoil, also began entering the Estonian gasoline market, building several modern filling stations in Tallinn and the surrounding areas. Meanwhile, the Estonian state oil company, Eesti K�tus, was forced to sell off many of its holdings and drastically scale back its operations in mid-1993 in order to pay an estimated EKR250 million in debts and back taxes. The company's market share was expected to drop from 70 percent to 30 percent.

Dependence on Russia for natural gas continued, with Estonia consuming about 1.3 billion cubic meters of Russian natural gas in 1990. Energy was in fact often used as a political weapon during the early 1990s. Estonia's two thermal power plants, for example, were staffed mostly by Russian workers who, to protest Estonian government policies, repeatedly threatened to shut down the plants. Although any disruption in production would also affect neighboring Russia, the possibility of problems persisted. Russia in turn threatened Estonia with a cutoff of gas supplies in June 1993 during the crisis surrounding Estonia's Law on Aliens (see Government and Politics, this ch.). The Russian gas company Lentransgas once shut down its pipelines to Estonia for a single day, ostensibly because of Estonia's US$10 million in unpaid bills. Also, Russian leaders often threatened economic sanctions for what they called discrimination against Estonia's Russian minority.

Transportation and Telecommunications

Estonia had a total of 30,300 kilometers of public roads (29,200 kilometers hard-surfaced and 1,100 kilometers un-paved) in the early 1990s. These was little traffic congestion, thanks to the relatively low number of automobiles per person--140 per 1,000 inhabitants. Estonia's major roads include Highway M11 to St. Petersburg and Highway M12 to Riga. In 1990 the roads carried 214 million tons of freight, or 85 percent of the total freight for that year. Estonian officials, for their part, were seeking to increase international truck transport through the country by encouraging the development of an international highway project, Via Baltica, from Tallinn to Warsaw (see fig. 6).

Bus transportation was widely developed during the Soviet period, totaling 4.5 billion passenger-kilometers in 1990. By 1993 the removal of state subsidies had forced an increase in ticket prices, a decline in ridership, and a contraction of service. New international routes, however, were opened to Germany and Denmark.

With a total of 1,126 kilometers of track, railroads in Estonia carried 30 million tons of freight and 16 million passengers in 1993. Estonia's main rail lines link Tallinn with Narva and St. Petersburg, Tartu with the Russian city of Pskov, and P�rnu with Riga. More than 130 kilometers of rail line are electrified.

Estonia's new era of democratic politics began slowly in the 1990s with the adoption of a new constitution and the formation of stable political groupings. Several mechanisms in the constitution were beginning to function to ensure a balance of power and steady government. Citizenship issues, however, caused tensions among the country's 500,000-strong Russophone population, most of whom had been denied automatic citizenship rights in 1991. Their naturalization and integration into Estonian society remained a significant challenge.

The election in September 1992 of a new parliament, the Riigikogu, and the formal restoration of the Republic of Estonia marked the opening of a new political era. Not only was a new set of deputies elected, but Estonia took a further step in defining its political forces and developing a new political culture. As expected, right-wing parties did best in the electoral poll, promising "to clean house" and offer a fresh beginning after the Soviet era. The contest for the 101-seat Riigikogu yielded a three-party center-right coalition government holding fifty-two seats. The Fatherland Party (Isamaa) led the coalition with thirty seats, the Estonian National Independence Party (Eesti Rahvusliku S�ltumatuse Partei) had ten seats, and the Moderates (M��dukad--made up of the Social Democratic Party and the Rural Center Party) had twelve seats. In opposition were the Coalition Party (Koonderakond), the Rural Union (Maaliit), the Estonian Center Party (Eesti Keskerakond), the Royalist Party (Rojalistlik Partei), and the Estonian Citizens Union (Eesti Kodanike Liit). Because noncitizens were not allowed to vote in the election, most of Estonia's Russian population was excluded from the poll. Consequently, the new Riigikogu was 100 percent ethnic Estonian.

The 1992 elections also saw a special contest for the largely ceremonial post of president. Although the new constitution stipulates that the president shall be elected by the parliament, the Constitutional Assembly in early 1992 succumbed to popular pressure and agreed to have the country's first president elected by the people. In the resulting poll, the incumbent chairman of the parliament, Arnold R��tel, topped the list. But with only 41.8 percent of the vote, he did not muster the majority needed for direct election under the special rules. Although a former communist, R��tel had been widely admired for his steady, balanced leadership during the independence struggle. Yet, his electoral shortfall was enough to throw the final decision into the Riigikogu, where the runner-up, with 29.5 percent, Isamaa candidate and former foreign minister Lennart Meri, had the advantage. At the parliament's opening session on October 5, Meri defeated R��tel by a vote of fifty-nine to thirty-one.

Under the constitution adopted on June 28, 1992, Estonia has a parliamentary system of government, with a prime minister as chief executive. Parliament also elects a president, whose duties are largely ceremonial, although the first holder of this office, Lennart Meri, sought to assert his independence. The constitution also governs the work of a legal chancellor, an auditor general, and the National Court.

The constitution opens with a set of general provisions and a forty-eight-article section establishing the fundamental rights, liberties, and duties of citizens. Freedom of expression and assembly, freedom of information, the right to petition the courts, and the right to health care are all guaranteed. Censorship and discrimination on the basis of nationality, gender, religion, or political belief are forbidden. The official language of Estonia is Estonian. However, in deference to heavily Russian areas of northeastern Estonia, the constitution allows for the use of other languages in local government where the majority of the population is non-Estonian. Article 9 of the constitution guarantees equal constitutional rights to both citizens and noncitizens living in Estonia. Noncitizen permanent residents are also allowed to vote in local elections. Noncitizens may not, however, join political parties or hold elected office.

The Riigikogu (State Assembly), which replaced the transitional Supreme Council in 1992, has 101 members, who are chosen every four years by popular election. Members must be at least twenty-one years old. Each member may belong to only one committee. The president of the republic is elected to a five-year term by a two-thirds majority of the Riigikogu. The president nominates the prime minister, who must receive a vote of confidence from the Riigikogu. The Riigikogu passes legislation as well as votes of no confidence in the government. The president can dissolve parliament if there is a prolonged delay in the nomination of a prime minister or in the adoption of a state budget, or after a vote of no confidence in the government.

The president promulgates all laws after their adoption by the Riigikogu. However, he or she may also refuse to promulgate (i.e., veto) a law and send it back to the Riigikogu for reconsideration. If the Riigikogu passes the same law again by a simple majority, the president's veto is overridden. In 1993 President Meri vetoed seven laws, most of which were later modified by the Riigikogu. An early string of vetoes in the spring of 1993 especially angered members of the government coalition in parliament who had helped to elect him. Meri declared it his obligation, however, to protect the balance of power in government. His involvement was particularly critical during the domestic and international crisis surrounding Estonia's Law on Aliens.

The legal chancellor is appointed by the Riigikogu to a seven-year term and provides guidance concerning the constitutionality of laws. This official has no powers of adjudication but can issue opinions and propose amendments. Both the legal chancellor and the president may appeal to a special committee of the National Court for a binding decision on any law, national or local, that they consider unconstitutional. The court system comprises rural and city, as well as administrative, courts (first-level); district courts (second-level); and the National Court, the highest court in the land. Criminal justice is administered by local first-level courts as well as by second-level appellate courts. Final appeal may be made to the National Court, which sits in Tartu.

Central government policy at the regional level is carried out by the administrations of Estonia's fifteen counties (maakonnad ). These counties are further subdivided into 255 local administrative units, of which forty-two are towns and 213 are townships (vald ). Local councils are elected for a three-year term by permanent residents of the towns and townships.

Estonia - Mass Media

The mass media in Estonia played a catalytic role in the democratic upsurge of the late 1980s that led to independence. Responding during 1985-86 to Mikhail S. Gorbachev's call for glasnost (openness), the Estonian media, especially newspapers, began to focus on the many social and economic problems afflicting the country at the time. Yet, the blame for these social and economic ailments soon began to fall on the political system, an outcome that Gorbachev had not intended. For instance, the fight against an extensive and environmentally dangerous plan to mine phosphorus in northeastern Estonia was energized in 1987 by several articles in the monthly Eesti Loodus . The Tartu daily Edasi (later renamed Postimees ) would become a lively forum for the discussion of economic reforms such as Estonia's economic autonomy plan, the IME plan. The daily newspaper of Estonia's Komsomol, Noorte H��l , took the lead in exposing the abuse many young Estonian men were suffering in the Soviet army. Many Estonian cultural publications, such as the weekly newspaper Sirp ja Vasar and the monthly journals Looming and Vikerkaar , carried historical overviews of Estonia's annexation in 1940 and of the deportations that followed. Finally, on television and radio, several roundtable debate programs were aired, where more ideas were articulated. As political mobilization grew, the mass media became interactive players, reporting on the new events while giving further voice to varied opinions.

The Estonian-language media operated in sharp contrast to Estonia's two main Russian-language dailies, Sovetskaya Estoniya (later renamed Estoniya ) and Molodezh' Estonii , whose editors took a defensive stance toward rising Estonian nationalist feeling. The Russian community in Estonia was more heavily influenced by local communist party leaders, who remained loyal to Soviet rule. The Russian-language newspapers also echoed some of the views of the Intermovement and other Soviet loyalist groups. In the aftermath of independence, both newspapers were left searching for a new identity, as was most of the Russian community now living as a minority cut off from Russia.

In the early 1990s, the Estonian media diversified greatly as competition among newspapers grew. The flashy weekly Eesti Ekspress , run by a Finnish-Estonian joint venture, captured much of the early market, but it was soon joined by other rivals. Business-oriented publications emerged, such as �rip�ev, a joint venture with Sweden's Dagens Industri . In 1992 a new daily, Hommikuleht , was launched by a group of private investors. Estonia was also the base for the Baltics' largest circulating English-language newspaper, Baltic Independent . Still, the growth in the number of newspapers could not compensate for a rise in subscription rates and a decline in overall readership. Print runs fell from nearly 200,000 in 1990, when newsstand copies cost the equivalent of US$0.05, to an average of 40,000 in 1993. Still, in 1993 there were approximately 750 serial publications in Estonia, three times the number in 1987.

Television and radio changed as well. During 1992-93 three commercial radio stations went on the air. Each offered a mix of rock music, news, and features. State-owned Estonian Radio spun off one of its two stations to compete with the new formats. Several regional radio stations also began broadcasting. Estonian state television received competition in the fall of 1993 when the government gave rights to three companies to start broadcasting on two channels previously used by Russian television. Earlier, the government had decided to stop paying for the rebroadcast of the Moscow and St. Petersburg channels in Estonia.

Estonia - Foreign Relations

Both before and after independence, Estonia's foreign policy had a strong Western orientation. Western recognition of Estonia's legal independence was a key source of strength for the republic in its struggle with the Soviet Union. After 1991 Estonia worked to maintain that relationship and integrate with European political institutions as a further safeguard against potential threats from Russia. The last Russian troops stationed in Estonia after 1991 finally were withdrawn in August 1994, but relations with Yeltsin's Kremlin remained cool. Growing instability in Russia and Western attempts to placate Russian nationalism left Estonia anxious for greater European security guarantees but wary of being squeezed again in great-power politics.

Relations with the West

During 1990-91 Estonia undertook a vigorous lobbying campaign on behalf of international support for its bid for independence from the Soviet Union. The Estonian foreign minister at the time, Lennart Meri, was one of several Estonian officials who traveled widely to sustain the Western commitment to the republic's independence. Although the West generally remained in favor of renewed statehood for Estonia and the other Baltic states, Western leaders believed that the real key to that independence lay in Moscow. In August 1991, release of that key came in the form of the attempted coup d'�tat by conservative elements of the Soviet government.

In the wake of independence, Estonia moved quickly to join the international community. In September it was admitted to both the United Nations (UN) and the CSCE. In the UN, Estonia would later find common ground with the East European countries as well as participate in the organization's various committees and auxiliary bodies, such as the United Nations Educational, Scientific, and Cultural Organization (UNESCO), the United Nations Conference on Trade and Development (UNCTAD), the International Atomic Energy Agency (IAEA), and the United Nations Development Programme (UNDP). In March 1992, Estonia took part in the creation of the Council of Baltic Sea States, an association of all the countries bordering the Baltic Sea and dedicated to furthering regional economic and political cooperation. A year later, the Estonian representative was elected to a one-year term as president of the organization. In the realm of security, Estonia joined the North Atlantic Cooperation Council (NACC) in late 1991 and actively sought support for its efforts to become a member of the North Atlantic Treaty Organization (NATO). Cooperation with the European Union included significant economic aid as well as talks on a free-trade agreement.

Estonia's greatest foreign policy success came in May 1993 with its admission to the Council of Europe. After applying in September 1991, Estonia had to hold its first free parliamentary elections in 1992 before being seriously considered for membership. Although Estonia's citizenship policy came under close scrutiny by council delegations, in the end they accepted Estonia's legal arguments for denying automatic citizenship to Soviet-era immigrants, taking encouragement from the noncitizens' right to participate in local elections. Estonia considered admission the equivalent of a clean bill of health for its young democracy, which Russia had sought to tarnish with accusations of human rights violations.

In the mid-1990s, Estonia's staunchest foreign allies were the Scandinavian countries, particularly Denmark and Sweden. In 1990 the three Baltic states established regular contacts with the Nordic Council, the main political organization uniting the five Scandinavian states. Denmark's prime minister, Poul Schl�ter, became in 1991 the first Western head of government to visit Estonia. The Swedish prime minister, Carl Bildt, became an outspoken defender of Estonia after Russian threats to impose economic sanctions on Tallinn heightened tensions in 1993.

In some respects, the development of Scandinavian ties appeared to be a higher priority for Estonia than the fostering of greater Baltic cooperation, begun during the three republics' common struggle for independence. Baltic leaders held regular summit meetings beginning in 1990 and issued numerous joint declarations concerning their relations with Russia. An interparliamentary Baltic Council was established in 1990 to promote further cooperation at semiannual meetings. In mid-1993 Baltic military commanders even met to discuss plans for a joint infantry battalion that would be offered for peacekeeping missions around the world. Yet, progress on a free-trade agreement among the three countries was slow, and this situation was not helped in 1992 when Estonia elected a center-right government while Lithuania voted back in Algirdas Brazauskas and the former communists. Ultimately, a free-trade agreement was signed in April 1994.

Estonia's relations with the United States were strong, although the George H.W. Bush administration's initial delay in establishing diplomatic ties with the republic disappointed many in Tallinn. The United States held off recognition for several days in deference to Mikhail S. Gorbachev. However, Secretary of State James A. Baker visited all three Baltic states in September 1991 and five months later was followed by Vice President J. Danforth Quayle. Relations with the William J. Clinton administration appeared solid, although some Estonian officials expressed concern about what they perceived as its unqualified support for Russian president Boris N. Yeltsin.

Estonia - Relations with Russia

Estonia's ties with Boris N. Yeltsin had weakened since the Russian leader's show of solidarity with the Baltic states in January 1991. Issues surrounding Russian troop withdrawals from the Baltic republics and Estonia's denial of automatic citizenship to noncitizens ranked high on the list of points of contention. Immediately after independence, Estonia began pressing the Soviet Union, and later Russia, for a speedy withdrawal of Soviet troops from its territory. Estonia insisted that the process be completed by the end of the year. The Soviet government, citing a lack of available housing for its troops, said not before 1994. In January 1992, some 25,000 troops were reported left in Estonia, the smallest contingent in the Baltic states. Still, more than 80,000 hectares of land, including an inland artillery range, remained in the Russian military's hands. More than 150 battle tanks, 300 armored vehicles, and 163 battle aircraft also remained. The last troops did not leave until August 1994.

In the fall of 1991, as Estonia laid down its new citizenship policy, the Soviet Union called the move a violation of human rights. Under the citizenship policy, most of the country's large ethnic Russian minority were declared noncitizens. The Soviet government linked the further withdrawal of troops from Estonia to a satisfactory change in Estonia's citizenship stance. In response, Estonia denied the human rights charges and invited more than a dozen international fact-finding groups to visit the country for verification. As the propaganda war and negotiations dragged on, Estonia and the other two Baltic countries gained international support for their position on troop withdrawal at a July 1992 summit of the CSCE in Helsinki. The final communiqu� called on Russia to act "without delay . . . for the early, orderly and complete withdrawal" of foreign troops from the Baltic states. Resolutions also were passed in the United States Senate in 1992 and 1993 linking the issue of troop withdrawals to continued United States aid to Russia.

Yet, Estonian and Russian negotiators remained deadlocked throughout 1993. At several points, President Yeltsin and other Russian officials called an official halt to the pullout, but the unofficial withdrawal of forces continued. By the end of 1992, about 16,000 troops remained. A year later, that number was down to fewer than 3,500, and more than half of the army outposts had been turned over to Estonian defense officials. The Estonian and Russian sides continued to disagree, primarily over the pace of Russia's withdrawal from the town of Paldiski, on the northern coast some thirty-five kilometers west of Tallinn. The Soviet navy had built a submarine base there that included two nuclear submarine training reactors. Russian officials maintained that dismantling the reactor facility would take time; Estonia demanded faster action along with international supervision of the process. The last Russian warship, carrying ten T-72 tanks, departed in August 1994. However, Russia was to retain control of the reactor facility in Paldiski until September 1995.

Territorial issues also clouded Estonian-Russian relations. Estonia continued to stick by its demand for the return of more than 2,000 square kilometers of territory annexed to Russia by Stalin in 1945. The annexed land was within the borders Estonia and Russia had originally agreed to as part of the 1920 Tartu Peace Treaty. However, the Yeltsin government disavowed any responsibility for acts committed by the Soviet regime.

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