Estonia's main foreign policy priorities

Address by Raul Mälk, Minister of Foreign Affairs, for the Government of the Republic at Riigikogu, 26 November 1998


Honoured Mr. Speaker,
Esteemed members of the Riigikogu,


I stand before you today to present, on behalf of the Government, my regular report on Estonia's main foreign policy priorities. The Government's previous address to the Riigikogu on 11 June was dedicated to foreign economic policy. Today I will provide a broader overview of Estonian foreign relations by focusing on our fundamental foreign policy priorities and principles. I will address our relations with NATO, European Union integration, positive developments in our relations with Russia, regional co-operation and our foreign economic interests.



I

At the centre of national interest is the guarantee of state security. In this field, it is particularly clear how the challenges faced by a country can be met by combining national efforts with collective measures. Estonia enjoys good relations with its neighbours and has contributed to the search for solutions in Europe and, to a lesser extent, in the international arena. An analysis of the existing situation has confirmed that in the foreseeable future there is no sensible alternative to Estonia's co-operation with the North Atlantic Alliance. Thus, NATO accession has been an important part of previous foreign policy reports.

Currently we are focusing our efforts on preparing for the Washington Summit. 1999 is an anniversary year for NATO and the organisation will hold a summit in April. NATO will soon accept three new members - the Czech Republic, Hungary, and Poland. The further enlargement of NATO and the future membership of the organisation (in the long-term perspective), though they will probably not be the central themes, will once again come under discussion at the Summit.

In the coming months, we must continue to actively present Estonia's positions concerning the enlargement process in the capitals of NATO member states. It continues to be our position that the next round of NATO enlargement must include Estonia, Latvia and Lithuania, regardless of exactly when or where NATO decides on the next round of candidates for enlargement.

In Washington, we expect a clear message that will move beyond the 'open door' policy and the conventional confirmation that enlargement will continue. The Madrid decisions, welcomed by Estonia, need to be further developed. A so-called 'plus' -or why not even two - must be added to the decisions reached in Madrid.

It is obvious that our foreign policy steps must be closely co-ordinated with our efforts here at home. Our aim is to consolidate our image as a trustworthy partner. In the past year, the Government has created the necessary structures and framework to co-ordinate the NATO accession process more effectively. The Government created an Interministerial Commission in July to handle the specifics of our preparations for NATO accession. This commission co-ordinates all of our practical steps toward accession.

In the context of NATO, I would also like to mention two general themes here in front of the Riigikogu. These are national defence expenditure and the development of the command structure of the defence forces. A political consensus exists in Estonia that defence expenditure in the national budget must reach a level that demonstrates both our defensive capacity and the seriousness of our plans. The Government supports a smooth rise in defence spending to 2 percent of GDP in the coming years. As for the command structure of the defence forces, then it is evident that reform is needed to ensure the effective implementation of our national priorities.

With a view to improving the effectiveness of our NATO-related activity, we have established a mission at NATO in Brussels. The mission is responsible for conducting our day-to-day relations with NATO structures.

We will continue to participate actively in the Partnership for Peace Programme and develop our bilateral exchange of information with NATO within the intensified dialogue framework. We hope that this dialogue will become more practical and will clarify, for both sides, the specific requirements for our membership. One means for improving dialogue could be the preparation of a 'road map' for each candidate.

Estonia is also an active participant in the Euro-Atlantic Partnership Council.

Maintenance of the transatlantic link is an important aspect in our approach to European security. In this context, Estonia's relations with the United States in the security and defence fields are of particular significance. The Partnership Charter signed in January 1998 between the USA, Estonia, Latvia, and Lithuania, and the programmes launched within the framework of the Charter, are an expression of these relations. A meeting of the Partnership Commission, led by the three Baltic Foreign Ministers and the US Deputy Secretary of State, was held on 8 July 1998. This meeting, an example of the fruitful co-operation under the Charter, prepared reports on the activity of the bilateral economic and security working groups and set out specific goals for further co-operation.

To conclude my remarks on NATO, I would underline that NATO enlargement will only be concluded once the parliament of the country seeking to join has ratified the accession treaty as well as every NATO member. I call upon you to contribute to our efforts to join NATO by introducing to your colleagues in NATO member states our objectives and plans concerning our accession.



II

Esteemed members of the Riigikogu, allow me to now turn to the European Union.

EU membership is important for a small European state like Estonia. Membership will allow us to directly influence the Union's internal processes. These processes will have an impact on us, even if we remain outside of the Union. 56 percent of Estonia's total foreign trade is already with the European Union. In comparison, our trade with the CIS countries accounts for only 15 percent. The difficulties Estonia is currently experiencing in certain economic sectors demonstrate the vulnerability of small countries in today's globalising marketplace. Today, if we members of the European Monetary Union and already enjoyed full access to the EU's Common Market, then many of the threats faced by our economy would be considerably smaller.

The acquis screening process began on 31 March and accession negotiations were opened on the ministerial level on the concrete conditions for accession to the first seven chapters on 10 November. The start of substantive negotiations in parallel with the screening process is a significant step in the accession process.

It is important that the momentum of the accession process is maintained, as it is likely that the process will last for several years. As the official head of the negotiations delegation, I can confirm that our delegation and the Foreign Ministry have worked intensively to ensure that Estonia does not hold up the process. Position papers for the first twelve screened chapters were completed last summer. These positions were discussed and approved by the Government at the end of August and were officially presented to the European Union in early September.

Now we must move forward. Currently we are preparing additional positions and we are hopeful that the EU will be ready to conduct substantive negotiations in more then seven additional chapters during the German Presidency.

At the opening of accession negotiations on 31 March, my predecessor noted that the negotiations between Estonia and the EU would be unlike traditional negotiations, where the aim of both negotiating parties is too seek mutually satisfactory compromises. Rather, the accession negotiations are focused on finding ways and means to implement as much of the existing EU acquis as possible at the moment of accession.

Transition periods in certain areas are likely, even unavoidable. It will, however, be difficult to achieve permanent derogations, as they will have to be carefully supported by arguments drawing on our history, traditions, or other distinguishing features. This has been confirmed by substantive negotiations thus far.

As of today, we have reached the halfway point in the analytical comparison of Estonian legislation and institutions with the European Union's. To date, the screening has progressed successfully. The final bilateral screening meeting is scheduled for spring of next year.

Through the screening process we have gained a better idea of the amount of reorganisation that is still necessary on the domestic level prior to our accession. We also have a better idea of the timing of our accession. We have set 1 January 2003 as a possible date of accession to guide us in our everyday work. Meeting this deadline does not depend only on the actual negotiations that began on 10 November, but on our ability to resolve problems that have appeared during the screening process and our willingness to keep to our promises as outlined in our position papers. Estonia's rapid accession is dependent on our domestic reforms. Yet a great deal is also determined by the pace of reforms in the EU itself and dependent on the EU's readiness for enlargement and the existence of a critical mass of goodwill in support of enlargement. The European Union's enlargement and its reform must proceed in parallel.

Thus far we have made rapid progress. This was confirmed by the report released by the European Commission on 4 November. Nevertheless, in addition to our accomplishments, the report also outlines the work that still remains. We should not allow ourselves to think that Estonia is already practically an EU member and therefore no longer needs to make an effort. Becoming a full member depends on following through on our own plans. The Riigikogu, as the country's legislative assembly, has a key role to play in this process. The Riigikogu's European Affairs Committee has made a significant contribution to the European integration process which should be acknowledged.



III

Estonia's third principal foreign policy priority is developing good-neighbourly relations with Russia.

Since 1994, Estonia has been guided by a policy of positive engagement with respect to Russia. The basic principles of this policy have stood the test of time. In the past few years, so much progress has been made that at the last round of border negotiations; for example, both sides began by using almost identical wording in their positive evaluation of the process to date. Today, relations between Estonia and Russia can be characterised as mostly normal, and in some fields, as good.

Our bilateral relations with Russia are at a point where the political stability of our relations is starting to be perceived as a value for both countries. In turn, this has become the basis for co-operation in the economic and other fields. At the same time, I share my predecessor's opinion: so-called 'breakthroughs' in relations are rare in actual foreign policy. Ninety-nine percent of the time, progress is contingent upon consistent efforts, perseverance and attention to detail. Such efforts are continuously being made to improving economic relations between Estonia and Russia. In recent weeks, a long list of Estonian enterprises have managed to restore their relations with their Eastern partners. We value our co-operation with Russian regions.

Thanks to a number of small steps, trust has developed between Estonia and Russia. Visits of ministers and parliamentary delegations between our two countries have become regular.

We continue to regard the Intergovernmental Commission as one of the main instruments for co-operation between our two countries. Its principal aim is to strengthen the framework of bilateral agreements. It is worth noting that in spite of internal political developments that have taken place in Russia in the past six months, working level contacts between members of the Commission's working groups have persisted. The recent appointment of the new co-chairman for the Russian side provides an opportunity to hold the first plenary session of the Commission next week in Tallinn.

I am also pleased to note that we are approaching the finish in our border negotiations with Russia. Only a few, final technical issues are being clarified. Both the Estonian and the Russian side have publicly confirmed that negotiations will be concluded in the near future and thereupon preparations will be made for the signing of the agreement and its appendices. It has been agreed that only one more round of negotiations will be held.

As Russia's neighbour, Estonia is able to sense the significance of events in Russia and their possible repercussions, more immediately and rapidly than those who are further away. A good neighbour is one who tries to lend positive support to their partner even in difficult times. Estonia is ready to be just this kind of neighbour to Russia.



IV

Allow me to now turn to regional co-operation.

Estonia's relations with Latvia and Lithuania continue to be important in the context of regional co-operation. Estonia, Latvia, and Lithuania have common long-term foreign policy priorities, foremost EU and NATO integration.

A broad base of agreements has been established between our countries, and tomorrow the Baltic Assembly and the Baltic Ministerial Council are gathering here in Tallinn to make their own contributions to this co-operation. Trade and investment have increased rapidly, and there are already a number of firms that do business in all three Baltic countries.

In recent months, Estonia has continued to support the rapid inclusion of Latvia and Lithuania into the group of countries engaged in accession negotiations with the European Union.

Positive steps taken this year include the trilateral agreement to eliminate non-tariff trade barriers which came into force on 1 July, the Baltic Agreement on Common Transit Procedures signed on 10 July, and the Agreement for Common Standards in Secondary Level Education.

Although a great deal has been accomplished in our relations with Latvia and Lithuania, we should make better use of existing opportunities for developing trilateral co-operation. In particular, the enforcement of existing agreements by our partners should be ensured. Estonia has been constructive and willing to comprise in seeking to resolve problems that have arisen. Moreover, Estonia is doing everything in its power to help ensure that a signal is not sent to the international community that the Baltic states have given up on co-operation in favour of fruitless protectionism.

Further development of Baltic co-operative defence projects is of particular importance to Estonia. Thanks to the combined forces of the three Baltic countries as well as the substantial support of a large number of countries, BALTBAT, BALTRON, and BALTNET are being developed further. The opening of BALTDEFCOL in Tartu is planned for 1 September 1999. The framework provided by these projects is promoting deeper and more practical Baltic co-operation, and, of course, these projects are an important part of our preparations for NATO integration.

Baltic-Nordic co-operation and our participation in the work of the Council of Baltic Sea States complement Baltic co-operation. Estonia is active at all levels of regional co-operation. We are eager to see a development of pragmatic economic co-operation and co-operation to strengthen non-military regional security, including the fight against organised crime, within the CBSS framework. The development of energy networks and transit corridors also deserve mention.

A solid base of well-functioning agreements underpins Estonia's traditionally good relations with the Nordic countries. Our close relations with the Nordic countries are based on common interests that exist at many different levels. The start of accession negotiations to the European Union has added a new dimension to these relations.

In principle, Estonia welcomes the initiative aimed at adding a Northern Dimension to the European Union. We hope to be included in its execution from the very beginning, along with Latvia, Lithuania and Poland.

In parallel with regional co-operation, relations with the Central European countries are increasingly important for Estonia. Progress in this area depends directly on our diplomatic presence in this region. Our aim should be to fully staff existing embassies in these countries and establish a representation in Budapest.



V

The Government's previous report provided a thorough overview of our foreign economic policy. Therefore, today I will direct your attention to only a few aspects of our policies in this area.

First, our bilateral trade agreements. We have signed and brought into force 9 free trade agreements in recent years, including agreements with every Central European country included in the first wave of EU enlargement and the European Free Trade Association (EFTA). Our free trade agreement with Turkey came into force on 1 July 1998. By providing access to markets amounting to over 575 million consumers, these agreements provide Estonian enterprises with numerous export opportunities.

Now we should focus our attention to supporting the competitiveness of Estonian firms. The Estonian economy is heavily reliant on the foreign sector: there are few countries in the world where the export of goods and services exceeds two-thirds of GNP (74,1% for 1997). The state of the world economy today and the fact that our five main export partners account for two-thirds of our gross exports, mean that we should diffuse risk by diversifying trade flows.

Above all, now is the time to use all opportunities made available by free trade agreements with 60 million Central European consumers. The next step towards broadening our markets is signing economic co-operation agreements (aimed at establishing a most favoured nation regime) with Central Asian countries. This region's economic potential is growing, particularly in terms of the increasing purchasing power of the market. At the same time, Estonia's geographic position should be taken into account as well as the possibility of facilitating trade between Central Asian and Northern European markets, thus strengthening transit trade flows. Finally, we should aim to increase our activity in the Ukraine, larger Asian countries and Latin America.

I am pleased to note that efforts to raise Estonia's export potential have already begun. These include the launching of a new training strategy and preparation of a new export development policy.

Strengthening mechanisms to ensure the enforcement of existing economic agreements continues to be one of our priorities. Yet, as this is an additional burden on our economic officials, it requires raising the capacity of our embassies.

The successful conclusion of accession negotiations with the World Trade Organisation (WTO) is another one of our foreign economic policy priorities.

Accession to the WTO is possible once the following conditions have been met: first, bilateral negotiations must be concluded, and; second, an accession protocol must be adopted at a meeting of the working group. This protocol includes a review of the congruency of Estonian legislation and WTO rules as well as the results of the bilateral negotiations. Therefore, it would be unreasonable to expect WTO members to accept the accession protocol until we are able to guarantee that Estonian legislation conforms to WTO rules.

Other outstanding issues include intellectual property protection and veterinary rules. The lack of necessary legislation or the ineffective enforcement of existing laws in these fields is of particular concern.

At the same time, in implementing the EU trade policy, we are following the Government's activity plan, whereby operating mechanisms similar to those in the EU will be developed and rooted in the coming years. Additionally, we must guarantee a period of a few years when Estonia confirms its ability to effectively implement EU mechanisms.

In the coming months, our goal is to conclude WTO accession negotiations and agree upon the accession protocol. The next meeting of the Estonia-WTO bilateral working group is scheduled for 4 December of this year.

Successful accession, however, can only be guaranteed by effective co-operation between all of the concerned ministries and structures. Parliament also has a key role to play in this process. The Riigikogu must ratify accession to the WTO and, as such, our progress depends to a large extent on how quickly a bulky and detailed bill passes through the legislative process. I would use this opportunity to thank the present Foreign Affairs Commission of the Riigikogu for its constructive co-operation.



VI

This is the final foreign policy report by the Government before the parliamentary elections. It is well known that in foreign policy we must choose between what is desired and what we are capable of achieving. The reason for the relative success of our foreign policy in recent years is our selection of the right and necessary priorities for Estonia. This Parliament, by strengthening our legal framework, has also contributed to our progress in the field of foreign policy. All of this has helped establish our good international reputation, which has a significant impact on our security and our economic relations.

The Riigikogu could make an important contribution to this process by passing the amendment (747) of the citizenship law at the upcoming third reading, which would simplify the naturalisation process for stateless children born after the restoration of Estonia's independence.

More and more, our work in the foreign policy field is affecting the lives of every person in Estonia. Widening visa-freedom provides individuals with more freedom to travel. As a result, our consular officials are faced with a growing workload. In the past year alone, over 10,000 consular cases have been handled. This raises concerns about our ability to execute our consular duties as a gap emerges between our capabilities and our actual needs. The impact of Estonian foreign policy on the citizen can also be noted in other areas such as EU programmes, co-operation between government officials, which supports bi- and multilateral agreements, links between local governments and their opposites in other countries, student and cultural exchanges, and so forth.

In the past year, the abolition of visa requirements with countries belonging to the Schengen group has been one our main priorities. In April, the Government created a governmental delegation for the purpose of reaching agreements for the return of individuals illegally entering and/or illegally residing in other countries and for signing agreements on the abolition of visa requirements with the Schengen countries. This step was supported by the positive evaluations of expert groups from those countries whose findings (in the areas of border control, policing, and legislation) all attested to Estonia's readiness for visa freedom, as well as by Estonia's inclusion to the first group of countries in EU accession negotiations. Unfortunately, Estonia is the only country among the six invited to negotiations whose citizens still need a visa to travel to Schengen countries.

We have already negotiated and approved the texts of agreements for the return of illegal residents with the majority of the Schengen countries (Belgium, France, Germany, Italy, Luxembourg, the Netherlands, and Spain). Signature of these agreements is the precondition set by the Schengen countries for extension of the visa-free regime to our citizens.

Today, I cannot provide a date as to when Estonia's citizens will be able to travel to the Schengen countries without a visa, but there are signs that the other side wants to move forward. I am hopeful that the issue will reach its logical conclusion in the first half of next year.



I thank you for your attention.