Other State Department Archive Sites

The State Department web site below is a permanent electronic archive of information released online from January 1, 1997 to January 20, 2001. Please see www.state.gov for current material from the Department of State. Or visit http://2001-2009.state.gov for information from that period. Archive sites are not updated, so external links may no longer function. Contact us with any questions about finding information. NOTE: External links to other Internet sites should not be construed as an endorsement of the views contained therein.

Country Commercial Guides FY 2000: Estonia Report prepared by U.S. Embassy Tallinn, released July 1999 Note*

CHAPTER I. EXECUTIVE SUMMARY

This Country Commercial Guide (CCG) presents a comprehensive look at Estonia's commercial environment, using economic, political and market analysis. The CCGs were established by recommendation of the Trade Promotion Coordinating Committee (TPCC), a multi-agency task force, to consolidate various reporting documents prepared for the U.S. business community. Country Commercial Guides are prepared annually at U.S. Embassies through the combined efforts of several U.S. Government agencies.

Since regaining independence in 1991, Estonia's economic reform policy has led to a liberalized, nearly tariff-free, open market economy. During recent years the Estonian economy has continued to show strong growth. Estonian GDP grew by 5 per cent in 1998. Although fallout from the Russian financial crisis held growth to about 0.5% in 1999, many experts predict that the economy will regain its growth at the 4.5% rate in 2000. In 1998 Estonia began accession negotiations with the European Union (EU).

Estonia's liberal foreign trade regime, which contains few tariff or non- tariff barriers, is nearly unique in Europe. Estonia also boasts of a national currency that is freely convertible at a fixed exchange rate, and conservative fiscal and monetary policies. Estonia has free trade regimes with EU and EFTA countries and also with Latvia, Lithuania, Ukraine, Slovakia, Slovenia and Czech Republic. Estonia has observer status in the GATT and is in the final stages of preparation for WTO membership.

Estonia's business attitude towards the United States is positive and business relations between the U.S. and Estonia are increasing significantly. The primary competition for American companies in the Estonian marketplace are European suppliers, especially Finnish, Swedish and German companies.

Total U.S. exports to Estonia in 1998 were $175.1 million, forming 3.5 per cent of total Estonian imports. In 1998 the principal imports from the United States were meat and edible meat offal, poultry, protein isolates, boilers, electrical machinery, aircraft, ships, boats and floating structures. This trend is expected to continue through the year 2000.

With a market share of 3.5 percent, the United States is Estonia's seventh largest supplier after Finland, Germany, Russia, Sweden, Latvia and Denmark. The United States is among twelve largest customers of Estonia. The U.S. share of 1998 Estonian exports was 1.92 percent, or $175.1 million. Estonian future membership in the EU is not expected to have major bilateral trade implications for the United States. The membership will disadvantage U.S. - origin agricultural products as certain products will be subjects to new import duties and/or fees imposed in accordance with EU rules and regulations.

Estonia's greatest natural asset is its location at the cross-roads of East and West. Estonia lies just South of Finland and across the Baltic Sea from Sweden - the European Union's newest members. To the East are the huge potential markets of Northwest Russia. Having been a member of former Soviet Union, Estonians know how to do business in Russia and in other former Soviet block countries. Estonia's modern transportation and communication links provide a safe and reliable bridge for trade with former Soviet Union and the Nordic countries.