Savisaar on 2013: be prepared for the worst, but hope for the best

09.01.2013, 14:09

Mayor of Tallinn and Centre Party chairman Edgar Savisaar writes in Postimees that 2013 will be a difficult year and one marked by economic hardships.

Savisaar said that he remained hopeful that after economic problems are resolved, Estonians will be able to start building up such a state that they have been dreaming since regaining independence.

Speaking of Estonia’s economy, Savisaar writes that one must not forget that a large number of Estonians has left abroad for work and show no intention to return.

While the trend to leave Estonia for work abroad is speeding up, people who choose to find employment abroad should consider that many economies in Europe are downsizing which means that unemployment is likely to grow and competition for vacant jobs is becoming tougher.

In other words, although Estonians are known as good workers, countries that are facing economic problems are likely to hire their own people and leave the dirtiest, simplest and low-paying jobs for foreigners.

Savisaar writes that this is why he suggests that people who have left Estonia for work should not severe all their times with their homeland because the situation may change rapidly and they may have to come home sooner than they think.

Moreover, many neighbouring countries are that are Estonia’s large trading partners are now looking for ways to reduce subcontracting from abroad and create more jobs for their domestic industries. This means that the interest towards Estonia as a contract manufacturer is set to decline.

It will be a difficult year for Estonian export industry. Since imports are likely to remain high it means that the country’s foreign trade deficit is going to increase further.

One of the biggest problems is that the Estonian economy depends on foreign aid. Large net contributors of the European Union are already looking for ways to reduce their contributions to the EU budget. Why should German taxpayers support East Europeans who instead of saying thanks are more vocal in demanding bigger handouts?

There are big questions surrounding the European Union budget for the next financial period and the eurozone that has been for years in crisis.

One additional area of concern is the situation in Europe in general because, according to the International Red Cross, Europe may soon find itself in the middle of a hunger crisis because many households that have been managing well until now will have problems paying for their food.

The organization warns that one should be prepared for similar public uprisings as we have seen in Northern Africa, especially since hundreds of thousands of people from Southern Europe attempt to enter countries of Northern Europe in search of better life and income.

Domestically, prices are likely to continue going up also in 2013. While employers are under growing pressure to increase wages and some of them will also do so, this is going to increase the cost level and is likely to be translated into higher prices.

This means that for most of Estonians, 2013 will be a year of falling purchasing power.

Estonian leaders should start analyzing the situation in earnest and stop talking down the crisis in the style of Estonia being an island in a stormy sea that will be untouched by tempests.

Speaking of positive signs, Estonia has been rediscovered by Russian tourists and not only before New Year’s Eve. This is a great opportunity to develop our service economy and take advantage of Estonia’s attractiveness.

Estonian companies are also finding themselves on the shopping lists of some of the world’s largest enterprises, especially Asian companies. This position may not yet be very prominent, but Estonia’s eurozone membership, scarce population, pristine nature and proximity to Scandinavian markets is definitely a benefit.

In short, one hopes that Estonia manages to overcome the economic hardships and finally start building a welfare society that it has been dreaming about since 1991.