Estonia (Estonian: Eesti), officially the Republic of Estonia (Estonian: Eesti Vabariik), is a state in the Baltic region of Northern Europe. It is bordered to the north by the Gulf of Finland, to the west by the Baltic Sea, to the south by Latvia (343 km), and to the east by Lake Peipus and the Russian Federation (338.6 km).
A small and heavily forested country, Estonia is the most northerly of the three former Soviet Baltic republics.
Not much more than a decade after it regained its independence following the collapse of the USSR, the republic was welcomed as an EU member in May 2004. The move came just weeks after it joined Nato.
Estonia’s ‘fiscal squeeze’ has also been impressive. In fact, financial stringency means the government in Tallinn could even relax its fiscal policy slightly.
Booming exports and fiscal conservatism have been vital in improving Estonia’s overall economic health. Yet a low debt ratio, only 6.7% of GDP (the lowest in the euro-zone), and a rapidly adjusting labour market have also played a key role, pushing the Baltic minnow ahead of all other euro zone members both in resilience and fiscal sustainability.
The data up to 2009 show that, barring a few jurisdictions that specialise in offshore registration, Estonia’s entrepreneurial record was the best in the industrialised world. Since then it has done even better. The smallest of the Baltic states has long had low taxes and clean government, not to mention high levels of internet penetration and technical education. A lingering sense of urgency in a region that returned to the map of the world in 1991 after a 50-year absence helps too.
A gunman armed with explosives entered Estonia's Defense Ministry on Thursday and opened fire, but police stormed the building and killed him, officials said. No one else was hurt.
Many employees were seen escaping from first-floor windows as the gunman detonated a smoke bomb and fired shots in the central Tallinn building.
Defense Minister Mart Laar said authorities should investigate whether the assailant had been partially motivated by the terrorist who carried out last month's massacre in Norway that killed 77 people.
Estonia, which in 2011 became the latest country to join the eurozone, has been heralded by some as an austerity success story. That year, it clocked a faster economic growth pace than any other country in the European Union, at 7.6 percent. Estonia is also the only EU member with a budget surplus, and had the lowest public debt in 2011 -- 6 percent of GDP.
In 2007, the Baltic republic of Estonia was blindsided by a series of large-scale cyber attacks, crippling the country’s government, financial and media online networks – the world’s first cyberwar. Eventually the origins of the denial of service (DDoS) assaults were traced to Russia, which has led the country to create a Cyber Defense League, a specialty military unit of IT volunteers that would help fend off similar future cyberassaults.
Estonia's stock index is down 60% in the past year. Tourist numbers have fallen. A third of restaurants in Tallinn's old city center are expected to close in the next few months. It doesn't help that a diplomatic spat between Estonia and Russia, which erupted last year following Estonia's decision to relocate a Russian war memorial, has resulted in a 30% drop in exports through Estonia's ports.
More specifically it seems to be the slowdown in Sweden that is weakening Estonia's economy. In January (2011), exports to Sweden grew 128% to €162 million, but in November exports to Sweden actually declined from a year earlier, by 27% to €122 million.
The numbers may seem small but remember first of all that we are first of all talking about monthly numbers so at annualized rates these numbers are 12 times bigger, and secondly that Estonia is a really small country with only slightly above 1.3 million people and a GDP of only about €15 billion, which can be compared with about €11.5 trillion for the United States and about €400 billion for Sweden.
Estonia broke free from Soviet rule just over 20 years ago, together with its Baltic neighbors Latvia and Lithuania — who are also enjoying a robust recovery, but are outside the eurozone.
For older Estonians, memories of the grim days of Soviet occupation make it easier to accept sacrifices today. Among the young, there is a widespread awareness that in a nation of just 1.3 million people, the freedom and opportunities their generation enjoy depends on unity in times of crisis.
Estonians benefit from emerging from the Kremlin's yoke without the ethnic and political turmoil that has weighed down other post-Soviet states. When it broke free of communism, it started over with a crop of young entrepreneurs and idealistic leaders. "Because we started anew, we got new laws, new leaders, and new technology," says Jaan Tallinn, one of the founders of Skype, the Internet phone company that was recently sold to Microsoft for $8.5 billion. "The big winners were the start-ups."