No. 3




What Is the Basis for Estonia Being Fit to Continue as a Small State?

18 June 2001


RiTo No. 3, 2001

  • Ahto Oja

    Institute of Estonia's Sparing Development

The article will analyse the ethical, institutional, social, economic and ecological basis for Estonia’s ability to continue its existence on the basis of existing literature. The results permit us to claim that Estonia has an average, or relatively good ethical, institutional and social basis for the building of a society that is able to continue its existence.

The economic base was analysed using the continuity preservation (CP) indicator developed by the World Bank. In a study conducted by the World Bank in 1997, which compared 20 selected European Union member and candidate states, Estonia was 17th beating only Bulgaria, Rumania and Latvia. Estonia’s level of continuity preservation is 8.2% of the gross domestic product (GDP). In the selection mentioned above, Hungary was second place, with 23%, and Slovakia was fifth with 16.6 % of their respective GDP’s. These indicators were better than those of Austria, Finland, Spain, Sweden, Italy and Germany. The main reason for this situation is likely to be Estonia’s oil shale based energy system, because one of the reasons for a low CP is the high level of spending on carbon dioxide. Among the 121 states analysed by the World Bank, only seven countries had higher expenditure on carbon dioxide than Estonia: Uzbekistan and China (2.4), Bulgaria (2.7), and the Ukraine (3). Azerbaidzhan’s respective indicator is 5.1, Kazakhstan’s is 5.5 and Mongolia’s is 6.2. Estonia’s situation is no better in the observation of environmental balances. In the World Wide Fund for Nature’s (WWF) table of ecological footprints, we are 14th from the bottom (the table contains 152 countries with more than 1 million inhabitants). Estonia’s ecological footprint is 7.2 square measures, while it should be 2.18. If we deduct the pollution consumption ability currently present in Estonia from Estonia’s ecological footprint, we remain in deficit by 3 square measures. The reason is once again the same as in the case of economic ability to continue – an exceptionally high level of carbon dioxide per inhabitant. At the same time, Estonia has the natural basis to be able to continue. Estonia has 3 hectares of land per 1 inhabitant, we also have nearly 600,000 hectares of wetlands, which are neither used in agriculture, nor in forestry. Today, the use of ecological technologies would enable these territories to produce up to 20% of the required primary energy. As a consequence of such usage, the level of carbon dioxide expelled into the atmosphere as a result of energy production would roughly halve. There is more: wetlands are effective consumers of carbon dioxide, in addition to biomass, it is possible to collect local ecological construction materials from these territories, which would also relieve regional employment problems. The implementation of such an “environmental reform” in Estonia would immediately render positive the carbon dioxide balance of Estonia: the current 16 million ton CO2 negative would be replaced by 23 million tons positive. By selling its carbon dioxide quota to states, which do not enjoy such natural advantages, Estonia would earn 2.5 billion kroons per annum on the assumption that a ton of CO2 costs 10 US dollars. The assumed investment requirement for such an environmental reform would be 15 billion kroons and the return on investment would be in the range of between 6% and 16% depending on the specific conditions. In conclusion, we can construe that Estonia has the unique ethical, institutional, social, economic and ecological basis to build up and preserve itself. This remains true, even despite the sad current situation in the energy sector. The realisation of this basis requires only statesman-like responsibility and the courage to invest into technologies today, which would guarantee a high quality of life for our children tomorrow.

Full article in Estonian