TALLINN - Swedbank has boosted the reserves of its Estonian unit to cover investments made in its branches in the struggling Baltic economies of Latvia and Lithuania, the Swedish bank said on Friday.

It is boosting the unit's share capital by 400 million euros ($595 million), a bank spokesman said.

Nordic banking groups are heavily exposed to the deep recession and losses in the three Baltic countries, forcing the banks to recapitalise as they grapple with surging bad debts.

"It is Swedbank Group's internal capital relocation, which means we want buffers in our Latvian and Lithuanian branches for possible losses that could arise, as investments to Latvian and Lithuanian branches are made through a subsidiary in Estonia. So it means an increase of Swedbank AS share capital," Swedbank AS Estonia said.

"The bank successfully fulfils all requirements established by the Bank of Estonia, including capital adequacy requirements, it added.

Reporting by David Mardiste, editing by Will Waterman

Tallinn City Council that is controlled by the Centre Party re-elected Edgar Savisaar as mayor of Tallinn for another four years.

Deputy mayors will be Taavi Aas, Deniss Boroditch, Kaia Jäppinen, Merike Martinson, Eha Võrk and, as a newcomer, Jüri Pihl, leader of Social Democrats.

Pihl will replace Jaanus Mutli who is under investigation for suspicion to have received a 25,000 kroon bribe in the form of a gift voucher and decided to resign from the city government.

The only problem in Centre Party-controlled city council was the election of a city auditor which traditionally has belonged to the opposition. While IRL put forward Indrek Raudne for the job, Centre Party and Social Democrats proposed Nikolai Stelmach, another IRL member. After Stelmach turned down the offer, the city council voted for Raudne, but with only 23 votes for he was not elected. The next voting will be held in the next session.

TALLINN - Estonia's unemployment rate hit a record 14.6 percent of the labour force with 102,000 people unemployed, up from 13.5 percent in second quarter, but the increase slowed over the quarter, the statistics office said on Friday.

Estonia is facing the worse recession it has seen since 1993 after a consumer credit and real estate boom turned to bust with gross domestic product (GDP) contracting by 15.3 percent in the third quarter compared the same period a year ago.

"The number of the unemployed was the largest during the period after the restoration of the independence in Estonia", the office said in a statement.

The office added, however, that in the third quarter the number of unemployed increased by 10,000 people, less than in previous quarters and mostly due to young people entering the labour force after completing their education.

In the third quarter employment started to increase.
"Compared to the previous quarter the number of employed persons slightly increased, by 0.9 percent," it added.

Analysts have said a slight growth in exports helped support GDP in the third quarter from a 16.1 percent fall in the second quarter, but because of high unemployment, domestic demand is expected to stay weak well into 2010 slowing the recovery of the economy.

Source : Copyright Reuters

Estonian Open Air Museum plans to offer a Christmas Village to all its visitors to tell of traditional clean-up before the Christmas day and preparations for the holiday season, cooking, and decorations, Visitestonia.com/LETA informs.

The museum hosts specific themes exhibitions like the 1930's, fisherman’s holiday and an Orthodox Christmas.

The Museum offer carol singing, playing games, and learning about candle making, herbal medicines, and having the fortune read.

The exhibition will take place from December 19 to December 20, 2009

Out of the four largest ports in the Baltic States – Riga, Ventspils, Tallinn and Klaipeda, Tallinn Port has been the most successful in the first ten months of the year 2009. Tallinn Port's cargo turnover has increased by 6.3% in the first ten months of this year to 25.87 million tons, according to information from the Latvian business information portal ''Nozare.lv''.

Riga Port's cargo turnover in the first ten months of the year has increased by only 3.8% to 24.95 million tons, writes LETA.

Klaipeda Port in Lithuania posted the worst results, as it handled 22.51 million tons of cargo in the first ten months of the year, which is 11% less when compared to the same period last year.

The rapid reduction of cargo handled at Klaipeda Port has allowed Ventspils Port overtake the Lithuanian port in cargo turnover. In the first ten months of the year, Ventspils Port handled 22.72 million tons of cargo, which is a 3.5% reduction when compared to the first ten months of 2008.

Nina Kolyako

After years of planning, the award-winning BBC TV series, Walking with Dinosaurs comes to life in a stunning theatrical event.

Internationally renowned designers have worked with scientists to create 15 life-size dinosaurs, including the terror of the ancient terrain, Tyrannosaurus-rex! Be amazed and thrilled as the greatest creatures ever to walk the earth return before your eyes. It’s a dazzling 10 million pound arena spectacle of unprecedented size and quality set to captivate young and old alike. Marvel at the story of their 200 million year domination of life on earth. Watch them walk. Hear the roar. Be there as they fight for survival and supremacy. From the ripple of their skin to the glint in their eye, you will know the dinosaurs really have returned!

So make sure you have your seat to see the return of the dinosaurs!

Shows are:
12. of November at 19:00

13. of November at 16:00
13. of November at 20:00 This event is in Russian language!

14. of November at 12:00
14. of November at 16:00
14. of November at 20:00

15. of November at 12:00
15. of November at 16:00
15. of November at 20:00

Doors open hour before the Show starts.

Ticket information:
Buy a ticket here

Organizer:
Baltic Music Productions

More information:
www.dinosaurlive.com

The meeting of NATO foreign ministers in Tallinn next April will cost Estonia about 70 million kroons, said foreign minister Urmas Paet.

Paet told Postimees that the meeting that will be held in Tallinn on April 22-23 is definitely the biggest international event taking place in Estonia in 2010, but perhaps also of all time.

NATO technical workgroup arrived in Tallinn yesterday to discuss the preparations for the meeting.

The meeting will be attended by delegations of all 28 NATO member states and several NATO partner countries. One of the participants could be foreign minister of Russian Federation who would attend the meeting of the NATO-Russia Council.

The foreign ministry will set up a press centre for about 200 journalists who are expected to come to Tallinn to cover the event.

The NATO meeting will put huge pressure also on the capacity of Tallinn Airport since most delegations are expected to arrive with their own aircraft.

Toomas Hõbemägi

Thursday, the Bank of Estonia announced that the current account surplus stood at EEK 1.2 billion in September, up from EEK 0.38 billion surplus in the previous month.

At the same time, the capital account surplus increased to EEK 756.4 million from EEK 439.1 million in August.

In September, the financial account, including reserve assets stood at a deficit of EEK 1.16 billion, narrowing from EEK 1.26 billion deficit in August. But, the deficit of financial account, excluding reserve assets widened to EEK 1.66 billion from EEK 1.4 billion.

Meanwhile, the balance of payments' reserve assets recorded a surplus of EEK 495.6 million in September, up from EEK 146.5 million in August.

In the third quarter, the current account surplus amounted to EEK 2.5 billion, the central bank said.

Estonian foreign minister Urmas Paet met with Miguel Angel Moratinos, the foreign minister of the coming EU presidency Spain, Paet highlighted the importance of development of European Union IT agency, as BBN/LETA reported.

The main goal of Estonia's economic policy is to join the euro-zone, Paet confirmed during the meeting in Madrid.

"We are working in order to fulfill the Maastricht criteria and adopt the euro on January 1, 2011," Paet noted.

Paet stated that Estonia also hopes the significant progress to be made regarding the preparations for creation of a European Union IT agency during the Spanish presidency.

"Making use of the information technology more effectively than before in the European Union internal security sector is essential; and therefore we feel that the creation of a separate IT agency is very important," Paet stated in Madrid.

The meeting in Madrid addressing the priorities of Spain's presidency with Spanish Foreign Minister Miguel Angel Moratinos was also attended by the foreign ministers of Greece, Lithuania, Luxembourg, Finland, and Hungary.

Spain will take over the EU presidency starting as of January 1.

Juhan Tere

Tallinn - Toomas Hendrik Ilves, the incumbent president of the small Baltic state of Estonia, became the latest name Thursday to enter the race for the job of European Council President.

The Baltic News Service reported that Prime Minister Andrus Ansip told a news conference in Tallinn: 'I put forward... the name of Toomas Hendrik Ilves as a candidate fit for the position of both president and high representative for foreign policy. I do not think his chances are highly improbable.'

However, Ansip also spoke positively about other potential candidates including the UK's Tony Blair, Luxembourg's Jean-Claude Juncker and Belgium's Herman van Rompuy.

Ilves' name was first mentioned as a possible candidate for president last month by influential Polish policymaker Jacek Saryusz-Wolski, but at the time he refused to confirm if he was interested in the role.

But now it seems he is doubling his chances by being in the running for both positions at once.

His office as unavailable for comment Thursday night, but did issue a statement on his behalf stressing his commitment to his current job.

'As far as I am concerned, in the fall of 2006 I was elected president of the republic of Estonia for five years, and I will work to fulfill those duties,' he said.

'I hope that on November 19 in Brussels the European Union Council shall elect a president and foreign policy representative based on the internal coherence of the European Union and the principle of equality,' he said, in a broad hint that Eastern Europe should get at least one of the positions.

Ilves becomes the second president of a former Soviet Bloc country to have his name put forward, following Latvia's former President Vaira Vike-Freiberga.

Born in Stockholm to emigre Estonian parents in 1953, he has worked as a journalist, MEP and ambassador and speaks fluent English, German and Spanish as well as Estonian.

Read more: http://www.monstersandcritics.com/news/europe/news/article_1513034.php/Estonia-s-President-Ilves-joins-list-for-top-EU-job#ixzz0Wi8Eh1QI

Juhan Tere

Travelers going by train from Moscow to Tallinn can now enjoy modern, comfortable coaches with video watching facilities and an internet connection, Visitestonia.com press room reported.

The trains got new facilities both on routes from Estonia to Russia, and back.

All of these comfort services were first installed in more expensive business-class traveling coaches. There are plans to widen these into other compartments, too.

While the economic recession has decreased the number of train passengers by a tenth on Estonian routes, GoRail hopes to attract altogether 150,000 travelers by the end of the year, writes LETA.

The government is rushing through legislation that would allow it to collect 1.78 billion kroons in dividends from state owned Port of Tallinn and Eesti Energia.

Äripäev writes that this is the full net profit earned by the two companies last year.
Finance minister Jürgen Ligi has asked the government to discuss tomorrow it as an urgent matter.

Minister of economic affairs Juhan Parts who oversees both state companies has now proposed to set as dividends 416 million kroons from Port of Tallinn and 1.3 billion kroons from Eesti Energia.

Earlier, the government planned to collect 100 million from Port of Tallinn and 324 million from Eesti Energia in dividends.
The state plans to collect a total of 2.7 billion kroons in dividends from state companies this year.

Toomas Hõbemägi

Estonia is preparing to change the way share options are taxed and make it much less attractive for multinational companies.

Explains Marek Herm, tax adviser of Raidla Leijins & Norcous: "Under the the draft amendment of the Income Tax Act, shares or share options given to employees as part of incentive programs will become taxable right away and the tax amount would go up notably."

Such an amendment will make issuing of share options in Estonia even less attractive than it has been in recent years Under section 48 of the amended Income Tax Act, the securities or other material values given by employers to employees for free or at a lower than market price are regarded as fringe benefits and include share options. Since fringe benefits are a special type of wage income, employers would have to pay not only income tax, but also social tax on them.

Current section 48 does not regard such share options or shares given to employees of subsidiairies by parent companies as fringe benefits and companies have not had to pay social tax and can defer payment of income tax until the employee sells the option or shares. Share options are popular in large multinational companies where parent companies offer such shares to employees of subsidiaries usually at a 20% discount from market price. Many countries have introduced more favourable tax treatment of such incentive programs.

If the new amended Income Tax Act enters into force, such shares and share options would become fringe benefits, would be taxed when they are issued and include the obligation to pay both income tax and social tax.

Such an amendment will make share options in Estonia even less popular than they have been until now. Because of unfavourable tax and court claims, Estonian own companies have practically stopped offering such shares or share options. With the new amendment, also multinationals could soon stop doing so, taking away the opportunity for Estonian employees to earn from share price increase.

Toomas Hõbemägi

Estonia’s President Toomas Hendrik Ilves emphasised, when meeting with Riigikogu Committee on Financial Affairs, that State budget in 2010 must lead to Estonia’s accession to the European single currency from January 1, 2011, writes Postimees Online/LETA.

“I urge the Riigikogu to be firm and make all the necessary decisions in processing the 2010 State budget that would guarantee Estonia’s accession to the European single currency in 2011,” said the President.

The head of State noted that despite the growth in the unemployment rate, the decline in external demand and the difficult State budget position, Estonia has a realistic opportunity to meet all the necessary criteria for adopting the euro.

“I hope that the Government and the Parliament will not fail to use this opportunity. I also hope that the sense of responsibility will also prevail in spending by local governments,” said Ilves.

The President estimated that the budgetary position needs further improvement, considering the options of both increasing revenue and decreasing spending.

“I will not agree with those who estimate that the abandonment of the aspirations towards the euro would help Estonia to restore its economic growth. The euro is an important guarantee of Estonia’s economic stability and national security – it will put a stop to speculations about devaluing of the kroon and will increase Estonia’s reliability as the destination country of investments,” he said.

The President met with the Riigikogu Committee on Finance on Tuesday in order to hear, how the Parliament has planned the 2010 State budget processing and to discuss co-operation between all factions during processing of the budget.

Chairman of the Riigikogu Committee on Finance Taavi Rõivas stated that on the basis of the European Commission’s economic outlook, Estonia should cut next year’s State budget spending by another 400 million kroons, writes the National Broadcasting.

Rõivas said, after meeting with President Toomas Hendrik Ilves, that this year Estonia is very likely to meet with the Maastricht budgetary criterion, but additional cuts in next year’s budget might be necessary.

“The plan A is that nothing much would be changed in the budget as the Government has submitted a draft law that would actually fit within the allowed budget deficit margin of three%,” said the committee chairman. “However, we certainly cannot ignore the position of the European Commission, according to which next year’s budget may reach 3.2%,” he said, explaining that this means that there could be a need to cut another 400 million kroons.

Rõivas explained that particular cost-cutting measures are still subject to political debates, but finding additional revenue has not been ruled out. “However, I certainly do not support raising taxes as is proposed by Social Democrats,” he said.