Estonia

D

Currency and Banking

Estonia was the first former Soviet republic to issue its own currency, the kroon, which began circulating in 1992 (10.72 kroons equalled US$1; early 2008). The kroon is backed by gold, including reserves held for Estonia for more than five decades by the United Kingdom, Sweden, and France since Estonia was part of the USSR. The bank of issue is the Bank of Estonia (Eesti Pank).

E

Commerce and Trade

Proposals have been made for the construction of a natural-gas pipeline from Norway to Estonia that would cross Sweden and Finland. Since independence Estonia has made considerable progress in boosting its trade with the West. In 1991 over 90 per cent of its trade was with the former Soviet Union and its satellites. In 1994 about 31 per cent of its export trade was with the countries of the EU. Foreign investment jumped to US$139 per capita in 1994, the third highest in Eastern Europe.

V

Government

Estonia is a democratic parliamentary republic, where the parliament (Riigikogu) has a significant influence on the formation of the government and on the election of the president. The present republic of Estonia is a legal successor to the independent republic of the same name that existed from 1918 to 1940. A new constitution was approved by referendum in 1992.

A

Executive and Legislature

Executive power is vested in a government headed by a prime minister. The prime minister is nominated by the president and needs to be approved by the parliament. The president has limited executive authority, and is elected by the parliament in a secret ballot for a five-year term. The president is head of state and commander-in-chief of the armed forces, and may not serve more than two consecutive terms in office. The unicameral national legislative body, the Riigikogu (parliament, state assembly) consists of 101 members, who are elected by proportional representation in a direct popular vote for four-year terms, provided that their party receives more than 5 per cent of total votes cast.

B

Political Parties

In early 2007 there were over 30 parties and political groupings active in Estonia. The leading parties at the 2007 election were the Estonian Centre Party (Eesti Keskerakond), the conservative Union for the Republic—Res Publica (Ühendus Vabariiqi Eest—Res Publica), and the liberal Estonian Reform Party (Eesti Reformierakond). Other prominent groupings include the conservative Estonian People’s Union (Eestimaa Rahvaliit), the conservative Party Fatherland Union (Erakond Isamaliit), and the social-democratic People’s Party Moderates (Rahvaerakond Mõõdukad).