Initiatives need to be implemented soon

Photo: Jaanus Lensment

The prime minister's economic development working group, headed by Erkki Raasuke, presented its report to the public and the incoming coalition yesterday. The working group was paradoxically called to life by outgoing Prime Minister Taavi Rõivas, while the fruits of its labor will now benefit his three biggest competitors.

Head of LHV group Erkki Raasuke said that thorough work done over the past year culminated in the realization that Estonia does not have economic growth hindrances that could be easily removed, even though members hoped to find some at first. “We found certainty in that there is no silver bullet with which to solve all problems,” Raasuke said after the presentation.

Positive developments exist

Raasuke finds it would be possible to realize all the working group's ideas, even thought it would take a long time in some cases. “It is true that the proposals overlap to quite a big degree in several areas. We see developments today, and that they are quite positive in some areas. Regarding the latter, we can only urge faster implementation,” he said.

Raasuke briefly introduced his report to the developing coalition of the Center Party, SDE, and IRL yesterday evening. Other presenters included head of the Estonian Employers' Confederation Toomas Tamsar and CEO of Swedbank in Estonia Robert Kitt.

Chairman of the social democrats Jevgeni Ossinovski said that the coalition's positions are similar to that of the report in terms of identifying problems in Estonian economy after hearing the report. “The labor market is drying up, and labor productivity remains low; both these problems need to be addressed. As many people as possible need to be brought to the labor market,” he said. Ossinovski added that while the capacity of work reform has addressed the problem, more can be done.

The chairman said that the new coalition plans to take several steps regarding research and development and innovation. “We know the state is behind on its 1 percent of GDP financing pledge, and that additional resources are needed here. However, there are bigger problems: where does the money end up, as well as the private sector's modest contribution to research and development,” he said.

Ossinovski highlighted, as the third item, growth of labor productivity that needs to be improved in several aspects.

“On the one hand we need to boost labor qualification. The other side concerns closer ties between the education system and the labor market. It is most definitely an issue where there are no easy answers; however, it needs to be addressed nonetheless,” the head of SDE explained.

IRL chairman Margus Tsahkna said that boosting economic growth is definitely one of the goals of the new coalition, and that bright ideas in the working group's report will be harnessed.

“We do not want to lock ourselves in a rigid coalition agreement; it will only list major changes. Open governance means we are able to react to changes around us,” he said.

General principles

Ossinovski also said that simply because some ideas are absent from the coalition agreement does not mean they will not be pursued. “We will not overburden the agreement with 50 pages and 3,000 lines of promises. We are agreeing on more general principles of governance.”

The incoming coalition sees loan money as one instrument of stimulating growth. “It is a good time to include capital from the market. Estonia basically has access to interest-free loans at this time and has plenty of sensible places where to spend it to liven up the economy,” the chairman said. He gave road construction as one example among many.

The Center Party, SDE, and IRL moved to economic consultations following the presentation by Tamsar, Raasuke, and Kitt.