Estonia and Finland

02.02.2012

- Diplomatic Relations
- Visits of importance
- Co-operation
- Significant agreements
- Economic relations
- Cultural and educational relations

Finland recognised Estonia in 1920 and diplomatic relations were restored on 29 August 1991. Since August 2010 the Estonian Ambassador to Finland is Mart Tarmak. Finland's Ambassador to Estonia Aleksi Härkönen assumed his duties in September 2010.

Estonia has six honorary consuls working in Finland: in Oulu, Turku, Tampere, Kotka, the Åland Islands, and Vaasa. The Estonian Honorary Consulate in Vaasa was opened on 9 November 2010; the honorary consul there is Pekka Haapanen.

Finland has two honorary consulates in Estonia: in Tartu and in Pärnu.

Visits

Co-operation

Relations between Estonia and Finland are characterised by strong historic ties. The close contacts between the two countries extend to issues concerning politics, economics, culture and many other fields. Estonia’s accession to the European Union and NATO took bilateral relations to a new level. In order to better plan future mutual co-operation between the two EU countries, ambassador Jaak Jõerüüt and former vice president of the Bank of Finland Esko Ollia compiled a report in 2003 that included proposals related to the environment, the economy, culture, science, and education. The majority of the recommendations of the report have been implemented and in June 2007 prime ministers Andrus Ansip and Matti Vanhanen decided that a new report concerning the future relations between Estonia and Finland be compiled. In 2008, a report entitled “The Co-operation Opportunities of Estonia and Finland 2008” was compiled by Vice President of the Nordic Investment Bank Gunnar Okk and former Finnish ambassador Jaakko Blomberg, the purpose of which was to offer ideas as to how Estonia and Finland could better cope with challenges ensuing from globalisation and help each other to raise the competitive capacity of the countries. Both of the reports are available at: http://www.vm.ee/?q=et/node/199

Co-operation between Estonia and Finland in defence matters is regular and active and includes regularly occurring political and defence consultations as well as shared practical endeavours. Close co-operation has taken place in the field of defence education and military training, as well as in connection with procurements and arms control.

Good, direct relations have been established between institutions under the jurisdiction of the ministries of the interior and justice. Co-operation in the prevention of crime is of considerable importance to the police, border guards and customs services. The co-operation of the Estonia-Finland anti-narcotics working group has been very successful. Co-operation has also taken place regarding reciprocal recognition of business prohibitions. As of 6 June 2009 Estonia unilaterally recognises Finland’s business prohibitions, so an individual with a business prohibition in Finland cannot establish a business in Estonia, become a member of the board of a new or existing business, begin working as a self-employed person, act as a liquidator, etc. On 12 December 2011 the prime ministers of Finland and Estonia signed a legal aid agreement that declares that the countries will reciprocally recognise documents printed from the population registry without an apostille.

The two countries have also developed extensive co-operation in environmental matters, where special attention is paid to ensuring the safety of the Baltic Sea environment. Estonia and Finland along with several other Baltic Sea States have made great efforts in having the Baltic Sea recognised as a Particularly Sensitive Sea Area (PSSA). In the name of improving the situation of the Baltic Sea environment, co-operation is taking place within the framework of HELCOM and the International Maritime Organisation (IMO). On 10 February 2010 a summit of the Baltic Sea states took place in Helsinki, during which the participants committed to contributing to the improvement of the Baltic Sea environment.

One condition that sets the stage for close bilateral educational co-operation is an adequate and thorough knowledge of each other’s history, and the importance of this has been confirmed by, among others, the presidents of both countries. The education ministries of both nations have expressed their readiness to advance reciprocal language instruction on all educational levels. It is possible to study Estonian in many Finnish universities (Helsinki, Turku, Tampere, and Oulu, and in the University of Eastern Finland in Joensuu). A big step was made when the professorate of Finnish language and culture was opened at Tartu University in September 2006. Based on the growth of the Estonian population in Finland, the need for Estonian-language education in Finland is growing more apparent. Previously Estonian was taught most systematically on the primary school level at Roihuvuori school in East Helsinki. In August 2008, following the example of the Roihuvuori school, a bilingual class for Estonian children was opened at Latokartano school in Helsinki. As of the fall of 2009 there were already five Estonian-Finnish classes. Finnish is taught in a few dozen Estonian high schools as an elective subject. In vocational schools, Finnish language classes are primarily found in the service curriculums. It is possible to study Finnish language and culture at Tartu and Tallinn universities.

Estonia and Finland have developed their close co-operation further through participation in different international organisations, which have supplemented their close bilateral relations.

Significant agreements

Treaties between the two countries have been developed extensively. As of 1 May 2004, economic relations are governed by the regulations of the EU’s internal market. There are 32 bilateral agreements between Estonia and Finland, of which the following are the most significant (a complete list of agreements can be found here http://www.vm.ee/?q=en/taxonomy/term/59) :

• Agreement Between the Government of the Republic of Estonia and the Government of the Republic of Finland on the Mutual Protection of Confidential Information (came into force 5 June 2007)
• Agreement Between the Government of the Republic of Estonia and the Government of the Republic of Finland on the Reciprocal Holding of Stocks of Crude Oil and Petroleum Products (came into force 23 December 2006)
• Social Insurance Agreement (came into force 1 Nov 2006)
• Agreement on Joint Implementation Projects for the Reduction of Greenhouse Gas Concentrations (came into force 19 Jan 2004)
• Agreement on Environmental Impact Assessment in a Transboundary Context (came into force 6 Jun 2002);
• Agreement Regarding the Readmission of Persons Whose Entry or Residence is Illegal(came into force 3 Oct 1996)
• Agreement for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and on Capital (came into force 30 Dec 1993)
• Agreement on the Promotion and Protection of Investments (came into force 3 Dec 1992) 

Economic relations

TRADE

Finland is perennially Estonia's largest trade partner.

According to data from the first eleven months of 2011 Finland once again rose to be Estonia’s primary trade partner, after briefly losing its top position to Sweden. Trade with Finland made up 13.65% of Estonia’s total trade turnover; trade with Sweden made up 13.28% of the total. Estonia’s main export market was Sweden with 15.99% of all exports, while Finland is its top import partner with 12.4% of imports. In the first nine months of 2011 trade turnover with Finland was positive by 294.2 million euros, with total trade turnover being 2.5 billion euros.

As of 30 June 2011 Finland had made investments in Estonia totalling 3.13 billion euros in value (24.1% of all direct investments in Estonia). The most investments were made in real estate but some were also made in the industrial, trade, and finance sectors.

Estonian-Finnish trade 2004-2011 (in millions EUR)

All economic figures originate from the Statistical Office of Estonia

Major export articles in first half of 2011:

• Machinery and equipment 239.6 million euros – 27%
• Metals and metal products 113.1 million euros – 12.8%
• Other manufactured goods 96.6 million euros – 10.9%
  

Major import articles in first half of 2011:

• Machinery and equipment – 28%
• Mineral products – 10.3%
• Metal and metal products – 13%

INVESTMENTS

Finland is the second-biggest foreign investor in Estonia after Sweden. The most investments have been made in real estate, but also in the industrial, trade and finance sectors. The activity of Estonian businesses in Finland is much more modest; there are few companies with Estonian capital registered. However, the interest of Estonian entrepreneurs in the Finnish market is growing.

As of 30 June 2011 Finland had made investments in Estonia totalling 3.13 billion euros in value (24.1% of all direct investments in Estonia). The most investments were made in real estate but some were also made in the industrial, trade, and finance sectors.

TRADE ASSOCIATION AND CHAMBER OF COMMERCE

The Finnish-Estonian Trade Association (SEKY), established in 1990, comprises Finnish enterprises active in Estonia and enterprises potentially interested in Estonia. The main purpose of SEKY is to establish business contacts and to improve relations between Estonian and Finnish businesses.

The Finnish-Estonian Chamber of Commerce (FECC, www.fecc.ee) mediates business contacts and provides its members with information about the Estonian economy. In the fall of 2007 the Estonian Embassy, the Finnish-Estonian Chamber of Commerce, Enterprise Estonia and local Finnish chambers of commerce co-operated to start up a series of seminars introducing the Estonian economy entitled "Verkotu Viroon". Seminars have been carried out in Tampere, Turku, Oulu, Kotka, and Helsinki; there are plans to continue holding events in other cities.

TOURISM

Finland is Estonia's most important tourism target market. The number of Finnish tourists in Estonia grew significantly after Estonia joined the European Union in 2004, but in the years 2005-2007 the number decreased by about 5-6% per year. Regardless of the decrease in the total number of tourists in Estonia in 2008 and 2009, the number of Finnish tourists grew, which may be due to longer and more expensive vacations being replaced with closer and less expensive options. In 2010 the number of Finnish tourists to Estonia once again grew more than any other group, reaching record levels (same as 2004). The number of Finns that stayed in accommodation establishments (mostly spas and health resorts) grew by 11% (it grew the most in Tallinn, where the number of Finnish tourists rose significantly above the all-time record level). Visits by Finnish tourists also increased in Pärnu and Pärnu County as well as in Lääne, Saare, Lääne-Viru and Ida-Viru Counties, while the long-term decline in Harju County continued. Tourism from Finland has grown thanks to many factors – the marketing activities of states, municipalities and private companies, good deals, offers for new tourism opportunities, and the general growth trend of Finns travelling abroad. According to Statistics Estonia, during the first ten months of 2011 1.449 million Finnish tourists were accommodated by Estonian accommodation establishments.

Cultural and educational relations

Estonia-Finland cultural ties are extremely close—the number and quality of reciprocal events introducing Estonian and Finnish culture are substantial. During 2008 the 90th anniversary of the Republic of Estonia was grandly celebrated in Finland. The events in honour of this anniversary were all joined together under the name “Estonia Comes to Visit”, which led to the development of a project meant for school-aged children, “Estonia Goes to School”. The goal of the project is to introduce Estonia’s history and language to Finnish schoolchildren; it has so far been a success and will continue this year.

The year 2011 could be named the year of Estonian-Finnish cultural co-operation. Tallinn and Turku were chosen to be the European Capitals of Culture and many joint projects and marketing events took place through the co-operation of the two Cultural Capitals. The Capital of Culture year concluded with the Helsinki Book Fair in October, where Estonia was the guest of honour. The event was opened by President Toomas Hendrik Ilves, whose successful book “Omalla äänellä” was also unveiled in Helsinki at the Estonian Embassy in September. Over 20 Finnish translations of Estonian books or books about Estonia were published in Finland in 2011, which is more than in the past ten years combined. This was in large part thanks to author Sofi Oksanen, whose triumphant year of winning many literary awards kept the topic of Estonia in the spotlight not only in Finland but also in the other Scandinavian countries, France, and the United States.

The idea came about to establish an Estonian House in Helsinki to support the Estonian population in Finland and entrepreneurship in Finland—the house would help to promote Estonia-Finland cultural relations, tourism, trade and economic relations and research co-operation, as well as introduce Estonia as a destination for investments. The Estonian House (Viro-keskus) is a “new generation” Estonian House, which brings together factions that represent Estonia (Estonian Institute, Tourism Development), that promote export and obtain investments (Enterprise Estonia), and that promote Estophilia and support the adjustment of newcomers (Tuglas Socety) all under one roof. The official opening of the Estonian House took place in Suvilahti on 17 September 2010.