I'm a little obsessed with the Baltic States (Estonia in particular), but I'd like to share interesting article that has been published in The Moscow Times. Brief comparative analysis of economic development of the Republic of Estonia and the Russian Federation. Both countries, once part of the USSR show significant difference in terms of development, and small Nordic republic outperforms "Big Neighbour" in almost every important aspect of state development. Though, it is not a surprise, since Estonia is doing well enough even within the EU Member States. Hence, while contemplating the future of this country, goal of Andrus Ansip (Prime Minister of Estonia) to make Estonia within the five richest EU states by 2022, doesn't leave a room for irony.

Here is the piece of article published in The Moscow Times, for the full version of it please follow the link.

Of all the post-Communist countries, none has been more successful in its reforms than Estonia. Today, it is difficult to imagine that only 20 years ago, Estonia and Russia were republics in the same state. A comparison between the two shows what really matters for social and economic development.
The least remarkable difference lies in gross domestic product. Estonia’s GDP per capita is about 20 percent higher than Russia’s at current exchange rates. This difference was about the same when both states belonged to the Soviet Union. In these terms, both have been successful. Estonia’s strong growth performance shows how limited Russia’s advantage is from its vast oil revenues, even when the oil price is close to an all-time high. The predicted growth rates for the next few years are similar at about 4 percent a year, though Estonia is more likely to outperform than Russia.
The contrast between Estonia and Russia becomes all the more striking when we turn to qualitative indicators. In the recent survey of math skills of school pupils by the Organization for Economic Cooperation and Development, Estonia ended up in 17th place, far higher than the Western average, while Russia fell significantly below the average in 38th place. More obscure comparisons of health care point in the same direction. The Estonian public sector functions very well by the standards of the European Union, while Russia’s social sector is neither effective nor efficient.
The largest difference is corruption. Out of the 178 countries on the Corruption Perception Index of Transparency International, Estonia ranks 26, while Russia is No. 154. Estonia was perceived as somewhat more honest in Soviet days, but not much. This discrepancy has largely arisen after the end of the Soviet Union. Estonia has grown more honest, and Russia far more corrupt.
The direct cause of this huge chasm is the business environment. On the World Bank index for the ease of doing business, Estonia ranks steadily 17 out of 183 countries, while Russia is 123rd and falling. Estonia is simply a much more livable society. Estonia is a leader in e-government, while Russia’s red tape remains oppressive.
These few observations show two different things. On the one hand, the level of economic development as measured in GDP is usually rather inert and economic convergence with the West requires decades. In terms of purchasing-power parity, Estonia has reached about half of the GDP per capita of the original 15 members of the European Union.
At the same time, however, in most qualitative regards, Estonia ranks higher than the original EU members, showing that the functioning of the state and the public sector can change much faster than people usually think.
Corruption is often blamed on ingrained traditions and institutions of the Soviet Union or the Russian Empire, but both Estonia and Russia were part of those states. Arguments of religion and culture have proved wrong so often that we may ignore them.
The rising gap between Estonia and Russia shows how important government policy is and how fast corruption and the state can actually change. No government can get away with blaming history or tradition for its failure to control corruption.
Nor is it sufficient to be a market economy or maintain good fiscal policy. Before the global financial crisis, Russia and Estonia had similarly limited public expenditures as a share of GDP, and both enjoyed persistent fiscal surpluses and had virtually no public debts. Both countries have flat income taxes and generally low or moderate tax rates.

Wednesday, March 16, 2011

Apple iRack

Great irony and political humour about the War in Iraq/on Iraq/Operation Iraqi Freedom or whatever name we prefer to give this war.

Saturday, March 5, 2011

From the USSR to Internet Voting

“Just voted with my mobile phone on Estonian elections. That is so awesome. Two minutes and I am done!” a tweet, posted by colleague of mine has become an inspiration for me to once again think of the country which is truly full of surprises. Yeah, the author of the tweet post quoted above, is a girl who is studying in the Netherlands and she has voted straight from Amsterdam through her mobile phone (!).
Sounds a bit unrealistic for most of the countries in the world, but Estonia can always "E'stonish" you by its achievements. 

It is indeed amazing to follow the development of this country after the restoration of independence from the USSR back in 1991. Since then, tiny and beautiful republic has become one of the Baltic Tigers due to the economic boom started in the beginning of the 21st century and logically ended up with the membership of the EU and NATO (Worth mentioning that EU/NATO membership has been the major Foreign Policy goal of the country). One of the major inventions of the ongoing century – Skype, has also been developed in Estonia and all these small high tech miracles logically led to the brand - "e-Stonia." 

Estonia is completely covered with wireless Internet access and it is even possible to travel between cities by trains/busses and keep Wi-Fi Internet access. Above all, much of this access comes virtually free and users do not pay any access charges in most locations.

Because of its high tech population, actually Estonia is the first country in the world (!) wherein the voters casted their votes through internet back in 2005. Around two percent of registered voters participated online in elections across the country and the usage of this voting method is increasing steadily. I won’t go through the details with all the voting methods used in Estonia as you can find more information here, but it is all truly extraordinary for a country, which has spent 40 years in basically non election friendly atmosphere under Soviet Occupation and managed to transform in a way to outdo many western democracies in various fields.

Speaking of the ongoing parliamentary elections – you can follow the coverage of it via Twitter on ElectionsLive