Estonian Economy

-Volume 12, No. 4 April 2008
Estonian Economy
ESTONIAN ECONOMIC POLICY ............................... 1
MAJOR ECONOMIC INDICATORS ............................ 2
FISCAL POLICY................................................................. 2
LABOUR MARKET............................................................. 2
PRICES ............................................................................. 3
STATE BUDGET ................................................................ 3
FOREIGN ECONOMIC RELATIONS ......................... 3
DEVELOPMENT BY SECTORS ................................... 4
BANKING..........................................................................4
ENERGY ...........................................................................4
INDUSTRY ........................................................................5
IT .....................................................................................5
MEDIA. TELECOMMUNICATIONS.......................................6
REAL ESTATE ...................................................................6
TOURISM ..........................................................................6
TRANSPORT......................................................................6
ESTONIAN ECONOMIC POLICY
• According to Finance Minister Ivari Padar, of the total budget revision in the amount of 3.1 billion
kroons (EUR 198), 2.1 billion kroons will be reduced expenses and about one billion kroons extra
revenue. Of the latter, the sale of properties of the state real estate management company RKAS would
contribute more than 300 million kroons. More than 660 million kroons of extra money is forecast to be
received as fines, state dues, dividends and proceeds from the sale of land. The biggest contributors will be
property sale and the dividend of the listed telecommunications company Eesti Telekom. Even though the
scope of the different sections is clear by now, the specific amounts in each case and the objects to be affected
will become clear in the near future. The ministry is on track to submit the draft of the negative supplementary
budget to the government for endorsement by May 15. According to information released earlier, the list of
properties to be sold includes the historic interior building in Pagari Street 1 in Tallinn, a property in Paslepa on
Estonia's northwestern coast formerly used as the president's summer residence, the compound of the former
Pärnu prison, and some other properties. Following the cut by 3.1 billion kroons the state budget for 2008 will
set out 88.2 billion kroons for expenditures, 10.8 billion kroons more than last year.
• The Estonian government has launched organization work for Estonia's participation in Expo 2010,
and according to the government's preliminary estimate it will cost nearly 60 million kroons (EUR 3.8
mln). The government decided to appoint Ambassador Toomas Tiivel the highest Estonian representative at
the Expo. Tiivel will be coordinating the preparatory work of Estonia's participation in the Expo. Expo 2010
will take place in Shanghai, China, from May 1 to October 31 with the participants focusing on the theme of
cities. In addition to national pavilions there will be different types and forums and events, including national
days, at the Expo.
• Against the backdrop of an overall cooling of the economy, the continued strength of export is having a
positive effect on the Estonian economy, analysts say. For the economy it is very good news that export has
remained relatively strong compared with internal demand. This helps the industry to stay buoyant and prevents
the economy from falling into recession. The firming of exports and the decline in imports reported by Statistics
Estonia had been expected. Fewer imported goods are needed as a result of declining consumption and
investments. Since it's more difficult for businesses to sell on the domestic market now, one's busier looking for
opportunities for export. Shipment out of Estonia has remained strong in all traditional branches of export and
also the export of machinery and equipment is starting to recover as had been expected. The growth rates of
export are expected to keep growing in the coming months, as there is no direct reason why the export growth
rates couldn't be bigger.
• The earlier problem of shortage of labor has been replaced by insufficient demand in both industry and
construction in Estonia, it appears from a study by the Estonian Institute of Economic Research
(EKI). EKI said that if in the first quarter of last year managers at only 27 percent of the industrial enterprises
covered by the survey named insufficient demand as their main problem then this year it was seen as such by
half the companies surveyed. Labor shortage meanwhile has lost importance as a factor holding back output
ESTONIAN ECONOMY is compiled from materials issued by Bank of Estonia, Statistical Office of Estonia, Estonian Ministry of
Finance and from Baltic News Services. Review is issued by the Press and Information Department, Ministry of Foreign Affairs
ISLANDI VÄLJAK 1,TALLINN, 15049 ESTONIA Tel: +372 631 7614 Fax: +372 631 7617 To subscribe please contact:
vmpress@vm.ee, http://www.vm.ee

April 2008
growth and was named as the main constraint by 19 percent of managers in the first quarter of this year,
compared with 36 percent in the first quarter of 2007. In the construction sector the ratio of such companies
dropped from 51 percent to 8 percent. Insufficient demand was named as the most important factor by 58
percent of construction companies in the latest survey, up from 44 percent in December. The good news is that
a third of construction companies are planning to cut prices in the near future. For the government this creates a
good backdrop for making investments and the state should consider going on with planned investments
despite the harder times that have arrived.
• A survey on consumer protection conducted by the Estonian Institute of Economic Research shows
that people's awareness of the fact that such a thing as consumer protection law exists has risen to 84
percent, or the same level as in the late 1990s. One-sixth of the population is unaware of the existence of
such a law. At the same time, among Russian-speaking respondents those not aware of the existence of the
Consumer Protection Act made up nearly a quarter of respondents. One-third of the respondents said they had
at least once been disappointed after making a purchase on the basis of an advertisement.
MAJOR ECONOMIC INDICATORS
• Increase in Estonia's exports and imports slowed down in 2007 compared to 2006 and the annual rate
of growth for 2007 was the lowest of the years since the country joined the EU. The export of goods
made up 125.5 billion kroons and import 177.1 billion kroons in 2007. In yearly comparison the value of
exports increased 4 percent and of imports 6 percent, the smallest such figures for the last four years. The
slowdown was partially the result of the rapid growth rate of exports and imports in 2006, when the annual
growth rates were 24 percent and 30 percent, respectively. The trade deficit amounted to 51.6 billion kroons, a
11 percent larger figure than in the year before. In 2006, Estonia's foreign trade deficit expanded by as much as
47 percent. The share of EU countries was 70 percent and that of CIS countries 11 percent in exports. Exports
to EU countries grew 11 percent compared to 2006 while exports to CIS countries were up 14 percent. In
imports the share of EU countries was 78 percent and the share of CIS countries was 13 percent. Imports
from EU countries increased 11 percent but imports from CIS countries dropped 13 percent in comparison
with 2006.
• The number of bankruptcies has considerably increased in Estonia in Q1 compared with the same
period last year. If 72 bankruptcy applications were filed to the Harju County Court in the first 3 months of
2007, then this year there were 119 such applications. In the Tartu and Viru County Courts the number of
bankrutcy proceedings has not increased.
FISCAL POLICY
• The inflow of income tax and VAT revenues into the state budget of Estonia in the first quarter of this
year was smaller than at the same time a year ago. VAT revenues in the first three months of 2008 totaled
4.694 billion kroons (EUR 299.94 mln), making up 92 percent of the sum collected in Q1 of 2007 and 18
percent of this year's target. The intake of personal and corporate income tax, at 698 million kroons, formed 90
percent of the inflow in the first three months of last year and 8 percent of the sum planned for this year. The
personal income tax revenue is at that negative, in other words, tax refunds exceed the sum collected.
Corporate income tax revenue in the three months made up almost 18 percent of the year's target. The social
tax intake added up to 7.513 billion kroons in the first quarter, 20 percent up from the same period last year
and nearly 23 percent of the inflow projected for the current year. Excise taxes totaled 2.281 billion kroons, an
increase of 29 percent year-on-year and 22 percent of the 2008 plan. All told, first-quarter tax intake was 18.394
billion kroons or 11 percent more than at the same time last year.
LABOUR MARKET
• The number of registered unemployed residents in Estonia grew 2.6 percent or by 441 people in
March compared with the preceding month to reach 17,181 at the end of the month. Year-on-year, the
rate of increase was 20.5 percent. Unemployed people registered with the Labor Market Board made up 2.7
percent of the entire capable population from age 16 to pension age. In the course of the month of March
19,427 people searched for a job via the Labor Market Board and 1,480 jobless people became employed. The
number of new job seekers registered as unemployed was 2,957. Unemployed people between ages 16-24
registered with the Labor Market Board numbered 2,126 as of March 31, while people aged over 50 numbered
5,360. Women made up 55.7 percent. The unemployment rate was highest in the southern Valga County, 5.8
percent, and lowest in Tartu County, also in South Estonia, at 1.7 percent. In Harju County, which includes the
capital Tallinn, the rate was 1.9 percent.
• Fears of Estonian residents as regards unemployment growth are on the rise and consumer
confidence continues to be low, a recent survey indicates. 7 percent of respondents considered it possible
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April 2008
that unemployment would grow considerably and 36 considered it possible that it would grow somewhat. This
marks a steep increase compared with the outcome of a similar survey from a year ago. About 10 percent of
households are using savings from earlier periods or live on debt, which is a stable ratio for the recent period.
Eighty-seven percent of households manage to save a little or make ends meet. While half of consumers have
made no changes in their consumption habits as a result of price increases in the past six months, 18 percent of
people are buying the same goods in smaller quantities, 23 percent are buying cheaper goods and 11 percent
are buying cheaper goods in smaller quantities. At the same time, the financial situation of households
remained good in March.
PRICES
• Estonian consumer prices rose by 10.9 percent year-on-year in March; in February the annual increase
was 11.3 percent. Goods were last month 10.1 percent more expensive than in the same month a year ago.
Food prices climbed by 14.5 percent and those of manufactured goods, by 6.6 percent. The cost of services
increased by 12.6 percent. Regulated prices of goods and services changed by 19.8 percent and non-regulated
prices by 8.5 percent last month in annual comparison. The inflation was driven mainly by rising food prices
and the increase in the prices of thermal energy, heating materials and motor fuel. Food cost last month 16.7
percent more than in March 2007. Dairy, cereal and meat products accounted for three-fourths of the increase
in food prices. The prices of goods and services were on the average 0.8 percent higher in March than in
February. Month on month, the CPI was most influenced by rises in the prices of motor fuels, bread and fresh
vegetables. Electricity was 2.4 percent cheaper than in February.
• The hike in food prices has not affected the share of expenses on food in households' expenses in
2007, Statistics Estonia has found. Similar to the previous year one fourth of the expenses was spent on
food and non-alcoholic beverages. In 2007 the average expenses per member of household totaled 4,358
kroons (EUR 278), 17 percent more than the year before. Compared with the year before expenses on food
increased by 16 percent, mainly because of higher grocery prices. The share of expenses on food in the
structure of expenses made by household members did not change compared with 2006, however, and also the
amounts of food items bought did not change. Last year a member of the household spent considarbly more
(by one fifth) only on bakery products and vegetables and 14 percent more on dairy products. The share of
expenses on transport and leisure time activities sharply increased in the structure of household members'
spending. The average monthly expenditure increased in all groups of expenses. Expenses on transport
increased the most, by one third. Also expenses on eating out, education, clothes and footwear, leasure-time
activities, food and housing increased on year.
STATE BUDGET
• Estonia continued to have the EU´s lowest government sector debt burden in 2007, or 3.4 % of GDP
compared with 4.2 percent of GDP in the year before, Eurostat said. Also having low ratios of
government debt to GDP were Luxembourg (6.8 %), Latvia (9.7 %) and Romania (13.0 %). Eight member
states had government debt ratios higher than the maximum 60 % of GDP allowed by the Maastricht treaty.
• The Estonian government's fiscal policy is slackening, Vice President of the central bank Marten
Ross said. In the central bank's opinion, this year will witness a marked slackening of the budget policy. If last
year the budget surplus reached almost 3 % of GDP then this year the government's aim is a balanced budget.
This course means the government's fiscal policy this year is supportive of economic growth as the share of
public spending in relation to GDP will increase. It would be better if the state's budget policy ran counter to
the economic cycle. The 2008 state budget should have had a 2 % surplus in relation to GDP from the first
and the government should not have planned so large expenditures at all. In the present situation it is even
more important to plan the 2009-2012 budgets with smaller outlays, Ross said.
FOREIGN ECONOMIC RELATIONS
• Estonia and Georgia have started negotiations to launch regular flights between Tallinn and Tbilisi.
Interest toward operating the route was expressed by the Georgian carrier Georgian Airways. The attitude of
Georgia's ministry of economic development and the aviation authorities toward the opening of an air route
between Tallinn and Tbilisi is positive and there's big willingness on both sides to open this air route. Before
the route can be opened an aviation agreement has to be signed between the two countries, which may take 3-4
months. The target group for the new route are tourists, businesspeople from Georgia and the Nordic
countries, and officials. According to preliminary information, Georgian Airways is prepared to fly between
Tallinn and Tbilisi twice weekly. The new route could be opened next year.
• According to PM Ansip, problems may emerge in certain projects with the absorption of EU support
allocated to Estonia in the previous financing period even though ministers are optimistic. Ansip
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April 2008
named projects such as the 43 million kroon (EUR 2.75 mln) labor market measures plan, the Emajõgi River
catchment basin water management project worth 700 million kroons, the construction of a breakwater in the
port of Tallinn for 371 million kroons, and the Kukruse road construction project budgeted at 590 million
kroons. It is not fully certain at this point that Estonia will manage to implement those projects and use up the
EU money. Absorption of EU support is particularly important in the present economic cooling situation
where utilization of EU monies would support the economy among other things by bringing extra taxes into
the state budget. Estonia has until the end of 2010 to distribute the EU support of the previous financing
period.
_______________________________________________________________
Further information is available:
http://www.eestipank.info/pub/en/dokumendid/statistika/
_______________________________________________________________
DEVELOPMENT BY SECTORS
BANKING
• The Estonian competition authority is going to study the size of banks' card payments. The
Competition Board is very much interested in the financial sector. It has planned an analysis of cross-bank card
use for 2008. The issue was taken up by the European Commission. If it has been found in Europe that there
are problems with free competition in that respect, then it is also an Estonian problem. However, it is still early
to assess what the investigation could bring. The service charges could be too high, but the results of our
survey will only be established at the end of the year.
ENERGY
• The Estonian Foreign Ministry wants to find out why a report on the environmental impact
assessment for the extension of Finland's Olkiluoto nuclear power plant does not cover the issue of
informing the international community about a nuclear incident or catastrophe. The Foreign Ministry
also suggested that Estonia take part in the environmental impact evaluation. Remarks and proposals on the
Olkiluoto environmental impact assessment report can be filed till April 20.
• AS Narva Elektrijaamad (Narva Power Plants) is planning to start burning biofuel in combination
with oil shale at one of its two large power plants. The new generating unit using the circulating fluidized
bed technololgy at the Baltic Power Plant is suitable for burning fuel of low combustion value and that up to
10 percent of biolfuel can be burned alongside oil shale in its furnaces. Given that the electricity output
capacity of the reconstructed generating unit is 215 megawatts, implementation of the plan would provide
Estonia additionally with more than 20 megawatts of capacity based on renewable sources of energy. Besides,
an estimated 150,000 tons less oil shale would be needed annually. Readjusting the existing furnaces that use
the circulating fluidized bed technololgy so that they can burn also biofuel is the cheapest and most effective
way for increasing the amount of renewable energy. It would create a stable and long-term demand on the
market for wood chips and other low-value biomass.
• The Baltic Sea region needs extensive investments to meet the increasing demand for energy and
reduce hazardous emissions in the coming years, Johnny Akerholm, president and CEO of the Nordic
Investment Bank (NIB), says. Akerholm emphasized that the Baltic Sea region faces a challenge in securing
the long-term energy supply. It is important to continue integrating national energy systems while also securing
adequate investments in new generation capacity. Investments are needed in order to increase the share of
non-fossil energy, reduce emissions and introduce new technologies in areas such as energy efficiency, carbon
capture and storage. The energy systems also have to be adapted to the consequences of climate change, such
as more violent storms causing damage to networks and other infrastructure. Action must be taken and soon.
Otherwise, the rising demand will lead to even more sharply increasing energy prices, which will threaten the
growth of the region in the longer term.
• Eesti Energia will invest 5.4 billion kroons (EUR 345 mln) during the financial year starting in April.
2.2 billion kroons of the investments will go into grids according to plans. This is more then ever before.
In power grids, the priority is raising the quality of grid services and remote reading of meters. The company is
planning to invest 2.2 billion kroons into the energy generation sphere. That sum does not include a possible
investment into a new oil-shale fuelled power bloc or other major project, which will be separately discussed by
the Eesti Energia supervisory board. Of the production investments in the plan a considerable share, 1.2 billion
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April 2008
kroons, will go into renewable energy, with the rest going to ensure reliability of power plants and to increase
their life.
• The generation of wind energy totaled 26.8 gigawatt-hours in January and February this year, 81
percent percent higher than the year before. Hydroelectric power generation increased by nearly 28 percent
to 5.1 gigawatt hours during the two months. In all, a total of 2,121 gigawatt-hours of electricity was generated
in Estonia in January-February, 8 percent more than in the same period the year before. Electricity import fell
by nearly tenfold to 27 gigawatt-hours against the previous year. In the same period export fell by about 17
percent to 286 gigawatt-hours. The fall in thermal energy output was by nearly 12 percent to 2,095 gigawatthours.
• Eesti Energia has signed a contract with the Jordanian government and the state-owned National
Electric Power Company on the construction of the first oil-shale fuelled power plant in Jordan. Eesti
Energia will get the exclusive right to develop a project aimed at the construction of a power plant of up to 900
megawatts. During the next 3 years studies as well as the necessary preparations for making the blueprints of
the construction work will be carried out under Eesti Energia's leadership. Eesti Energia's main role in the
project is sale of knowhow. The capital necessary for the construction of the plant can be borrowed from
major investors. The power plant to be built in Jordan would be the first considerable oil-shale fuelled power
plant operating outside Estonia. Khaldoun Qutishat, the Jordanian minister for energy and mineral resources,
said the Estonian Energy project was a breakthrough as launching of electric power generation on the basis of
local fuels would realize the country's decades-long aspiration of reducing its independence from imported
energy carriers.
• Estonian PM Ansip met with Lithuanian President Adamkus and confirmed that Estonia was very
much interested in going on with the Ignalina nuclear power plant project. Estonia wants to take part in
the Ignalina project, because it is a sensible decision. The parties stated at the meeting that Estonia and
Lituania had the same aims in the energy sphere. To achieve them the Baltic countries will have to closely
cooperate because the energy issue is important for all the three countries. The parties also stated that it was
important for the Baltic countries to create additional links with other EU countries. Both the countries are
actively working in that direction.
INDUSTRY
• The Australian stock exchange-listed company Monaro Mining NL wants to explore the Ida-
Virumaa region for different metals including uranium and gold. Monaro Mining NL founded a
subsidiary, Balti Kaevandused ja Uuringud (Baltic Mines and Exploration) in Estonia last year. The
Environment Ministry received on March 13 two applications for exploration title in its name which cover an
area of around 20,000 hectares in the Vaivara, Toila and Illuka municipalities. The aim of the exploration is to
assess workable quantities of mineral resources and perspectivity of concentrations. The list of metals to be
searched for includes iron, molybdenum, copper, lead, zinc, uranium, vanadium, gold, silver and platinum. In
the course of the exploration up to one hundred 60-500 meters deep holes are to be drilled. Permission is
sought for a period of five years.
IT
• A GfK Custom Research Baltic poll carried out in February revealed that 69 percent of Estonians aged
15 to 74 have home computers. According to the poll, the number of Internet users is the same. The
overwhelming majority of Estonians aged 15-45 own computers, and also the percentage of Internet users is
the highest in that age group. In the age group 46-74 nearly half have home computers and there are as many
Internet users among middle-aged and elderly people. Self-employers persons, persons holding managerial
posts or working as specialists are morer often owners of home computers than others. Home computers and
use of the Internet is more common also among persons with secondary or higher education. Nationality made
no difference in the ownership of computers or use of the Inernet. Of pensioners one fifth own home
computers, but their percentage of the Internet use is slightly lower.
• The cooling of the economic environment has not had a significant impact on the sale of computers
in Estonia, computer sellers say. The market of home users continued to grow in the first quarter and no
major changes took place in corporate demand either. According to the ML, sales to the public sector happen
at their own pace owing to the one-off nature of public procurement tenders. In regular sales, unit sales of
laptop computers of ML grew 46 percent while unit sales of desktop computers of ML dropped 15 percent.
That the sale of desktops is replaced by the sale of laptops is a fully normal process. The manager of the seller
of Apple computers IM Arvutid said that the slowdown of economic growth had not been felt in sales and no
decline had taken place in comparison with 2007.
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April 2008
• Estonia has retained its 20th place in the Networked Readiness Index (NRI) published by the World
Economic Forum as part of its Global Information Technology Report 2007-2008. Lithuania has
climbed to place 33 from place 39 in the survey published a year ago while Latvia has slid from place 42 to 44.
Published for the seventh consecutive year with a coverage of 127 economies worldwide, the report offers a
comprehensive and authoritative international assessment of the impact of ICT on the development process
and the competitiveness of nations. Among the 12 new members of the EU, countries such as Estonia (20th),
Slovenia (30th), Lithuania (33rd), the Czech Republic (36th), and Hungary (37th) have made remarkable
progress in networked readiness, as well as general competitiveness, over the last two decades. Among these
countries, Estonia, the tiny homeland of Skype, has benefited from a savvy e-leadership from a government
that has fostered innovation and universal ICT access as a platform for improved competitiveness. Another
Baltic state, Lithuania, realizes one of the biggest improvements, by six positions, in Europe from last year. The
top six countries on the scoreboard for 2007-2008 are Denmark, Sweden, Switzerland, the United States,
Singapore and Finland, in that order.
• Estonian companies and individuals have registered more than 6,500 .eu domain names in the first
two years of its existence. The .eu web domain is a relatively new thing, but nevertheless interest in it is great
in Estonia. Both entrepreneurs and private individuals regard the .eu domain as a good alternative for the
generic .com, .net and .org Internet addresses and Estonia's top-ranking domain .ee whose registration
conditions are still conservative. Registration for the European .eu web domain opened on April 7, 2006. Since
then, the domain has picked up nearly three million customers.
MEDIA. TELECOMMUNICATIONS
• The Estonian government endorsed amendments to the Broadcasting Act, which among other things
brings the date of switching off analog ground wave television forward to June 2010. The state had
earlier set the final date of transition to digital television to before the beginning of 2012. As a result the
government is planning to bring the switch forward by one and a half a years. There are currently about
160,000 families receiving TV signal by their own arials in the analog system. On transition to digital television
these families must acquire equipment enabling digital reception of TV picture.
REAL ESTATE
• According to the Colliers International real estate survey, despite office premises being added to the
existing ones in Tallinn no glut of the market is to be expected in the city this year. The projects being
built are mainly covered with preliminary contracts and the level of absorption remains high. However, as a
result of toughening competition a rise in the level of vacancies and a slowdown in the growth in rental prices
is to be expected. New developments of office premises will overwhelmingly be completed on the outskirts
and business activity is concentrating in new areas outside the city center. Due to the shortage of new plots in
the city center and continued high demand for A Class office premises owners have started reconstruction of
existing office buildings in the city center. Growth in the offer of new office premises has led to the rise of
vacancies; by the end of 2007 the vacancy rate of B class premises was 5.3 percent while the average vacancy
rate of A class premises continued to be very low -- about 1.9 percent.
TOURISM
• In February 72,000 foreign tourists stayed in Estonian accommodation establishments, which is 7,000
more than in the same month last year. Compared to February 2007, the number of tourists from Finland,
Russia, Latvia and Lithuania increased. Typically of winter months, Estonian residents made up half of
accommodated tourists. Their number grew by about 4,000 compared to February 2007. In February 678
accommodation establishments with 16,200 rooms and 34,400 beds were available to tourists. The room
occupancy rate was 36 percent. The average cost of a guest night was 457 kroons (EUR 29.2), up by 6 percent
year-on-year. A guest night in Tallinn cost on the average 571 kroons, in Tartu 415 kroons and in Parnu 326
kroons. In large accommodation establishments with more than 100 rooms, the average cost of a guest night
was 516 kroons.
TRANSPORT
• Tallink is looking for possibilities to improve the result of the Finland-Germany route, given the
combined effect of its length and the rise in fuel costs. Increased fuel prices have put pressure to the
group results. Costs for fuel have climbed by approximately 297 million kroons (EUR 19 mln) during the first
half-year, marking a rise of 47 percent. Given its length and speed of the service, almost half of the increase in
fuel costs came from the Finland-Germany route. As a result of higher fuel costs and lower cargo volumes
resulting from tougher competition in cargo transportation, the result of the Finland-Germany operation has
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April 2008
declined. Tallink is currently looking for a solution to optimize the operations of the Superfast vessels and to
improve their utilization. The target is to improve the return on capital in the Superfast segment and to
maintain the group's overall return ratios. Tallink bought the Superfast ferries serving the Finland-Germany
route two years ago for 310 million euros, borrowing 280 million euros for that purpose.
• The Superstar, a new passenger ship of the Estonian Tallink Group will go into operation on the
Tallinn-Helsinki route from the end of April. The Superstar has a speed of 27.5 knots, which makes it
possible to cover the distance between Tallinn and Helsinki in less than two hours. The new ship can take on
up to 2,080 passengers and 1,902 lane meters of vehicles. The ship has a total of 186 cabins and 736 beds.
• According to the forecast, the rail freight volume will drop from 44 million tons in 2006 to 27.6 million
tons in 2017, Estonia's minister of economy Juhan Parts said. The forecast assumes that oil products will
largely be replaced by other groups of commodities. A prerequisite for this is investments in the port and the
railway necessary for increasing container handling. A risk factor that has to be taken into account is that upon
completion of Russia's Baltic merchant ports and terminals Russian goods flows will be partly redirected into
local ports and cargo volumes carried on the infrastructure of Eesti Raudtee may therefore decline. Despite the
ministry's firm interest in increasing rail freight volumes it is at present difficult to assess changes in cargo
carriage in the more distant future or after 2017.
• Estonian Air has given up flying between Tallinn and Kuressaare. The company decided to stop flying
between Tallinn and Kuressaare this summer because the Avies airline operating on the same route on a state
subsidy is offering a good price and frequent schedule. Flights between Kuressaare and Stockholm will
continue as before on Thursdays and Sundays, but the aircraft will now be flying on the route Tallinn-
Stockholm-Kuressaare-Stockholm-Tallinn.
• Copterline started selling tickets to regular flights between Tallinn and Helsinki starting from April 9.
There will be 12 return flights on every working day. In the fall another helicopter will be added to the
Copterline fleet upon which flights will take place also on weekends. Copterline is resuming flights with a new
type of helicopter, AW139, which takes on 12 passengers and is much more comfortable and quiet compared
with the earlier machines. In the new machine so much has been invested into lowering the noise factor so the
passengers do not have to use ear plugs to protect their ears and can communicate with each other. The
Copterline ticket in the peak hour costs from 1,250-3,100 kroons, at other times tickets are available starting
from 800 kroons.
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