Prime Minister Jüri Ratas summed up the crisis situation and the measures that had been implemented in connection therewith, and presented a strategy to exit the crisis.
Ratas said that, on 9 March, six objectives to address the crisis had been set, through which it was also possible to assess in hindsight how Estonia had managed the crisis. They were the following: to prevent further spread of coronavirus into Estonia, to prevent the local spread of coronavirus in Estonia, to ensure that the health system copes with the control and treatment of coronavirus, to avoid the onset of panic in society and to raise people’s awareness of the prevention of the spread and the treatment of coronavirus, to ensure people’s coping with the indirect effects arising from coronavirus, and to ensure as normal functioning of the Estonian economy as possible.
Ratas explained that the spread of coronavirus into Estonia had stopped after borders had been temporarily closed. Extensive travel restrictions had been inevitable and nearly all European Union member states had restored temporary border control. “Of course, there could have been more cooperation and information exchange between countries in that situation, because we saw people having trouble returning home as well as problems with the transport of strategic goods,” Prime Minister said. In his words, those disruptions had shown that a well-functioning single market of the European Union and free movement were a great value and a security guarantee. “I believe that all parties have drawn their conclusions from the experience and that it became a lesson to maintain the unity of the European Union,” Ratas noted.
The Prime Minister underlined that the current crisis affected all other spheres of life, in addition to the health care system. At the last meeting of the Research and Development Council, they had looked at the studies in progress, and had initiated analyses in four other spheres. They concerned ensuring the supply security of vital goods, the effect of the crisis on people’s mental health, the socio-economic impacts of the spread of the virus, and virological, immunological and epidemiological studies. “An unavoidable precondition for all is that, although we have managed to deal with the first wave of coronavirus so far, we are also preparing for its return,” Ratas said.
Ratas explained that the health crisis had been accompanied by very serious impacts on the functioning and prospects of our economy. As a consequence of the measures used to contain the virus, the economic activities of the European Union have fallen drastically over a few couple of weeks. The costs made by consumers, industrial production, services, investments, capital flows, supply chains and many other important economic indicators have been severely affected.
According to the European Commission’s spring forecast, the economic recession in the euro area may reach 7.7 per cent this year. It is the greatest recession in the European Union’s history, much deeper than the one we experienced during the financial crisis of 2009. It is still difficult to make economic forecasts because there is no precedent that the current situation could be compared with. The extent of the uncertainty is eloquently revealed in the scenarios where the recession may turn out to be nearly two times greater at the end of this year in the case of longer-term restrictions and a second wave of pandemic.
The European Commission forecasts Estonia’s economic recession to be 6.9 per cent this year which is lower than the euro area average. The recession expected by the Commission is also lower than the eight per cent forecast by the Ministry of Finance in the beginning of April because it takes into account the impacts of the mitigation measures of the supplementary budget for 2020.
“The forecast for budget deficit in the euro area this year is 8.5 per cent on the average, and the public debt is 103 per cent of the gross domestic product. In Estonia, the budget deficit will grow to eight per cent of GDP, while the public debt will increase to 20.7 per cent of GDP in 2020. In spite of the great surge, the public debt will still remain the lowest in the European Union,” Ratas said. He added that the mitigation of the measures intended to contain the virus created the preconditions for recovery, but the economies of neither the European Union nor Estonia would be able to regain the damage even by the end of the next year.
Ratas noted that the emergency situation had terminated at midnight, but the crisis continued. Many of the restrictions are still in place. “We no longer need an emergency situation regime to manage it.”
Ratas said that the Government had adopted a strategy to exit the situation caused by the spread of COVID-19 and the work on it had begun already in the second week of the crisis. “Guided by it, we have assessed the situation and have made decisions on the restrictions in order to return to the normal way of life step by step. We are in the second stage described in the strategy, the stabilisation of the outbreak of the contagion, which will be followed by preparedness for a new outbreak.”
In Ratas’s opinion, the primary role of the strategy has indeed been to turn our eyes and thoughts towards exiting the crisis, but it is not a calendar plan, it does not think for us or give detailed instructions for each individual case. The document gives us a direction. It contains the national objectives, principles and criteria that have been agreed upon, which all our people, organisations and authorities can take as a basis for drawing up their personal exit plans.
“We wish to exit the crisis as a stronger and more unified society, and we have set four goals for that,” Ratas stressed.
The goals are the following: to ensure the physical and mental health of people, that is, to stop the spread of the virus and to mitigate the impact of the virus on the health system in both the short and the long term; to ensure that people cope and return to ordinary life, that is, to mitigate the potential impact that the restrictions of the emergency situation may have on people’s incomes, maintenance of jobs, education, and daily coping;
to support the businesses’ coping and competitiveness, that is, to mitigate the impact on them arising from the restrictions; to ensure the functioning of society and the country, that is, to maintain the necessary level of the supply of vital goods and the provision of services, to ensure the security of the population, adherence to the constitutional order, and the independence of the Estonian state.
“The basic indicators of the strategy serve as landmarks for us and, based on them, we also need to be ready to reverse if necessary. Such flexibility is inevitable in our situation. Patience is important, too, because the exit from the crisis must not become a new lockdown,” Ratas underlined.
During the debate, Kaja Kallas (Reform Party), Kersti Sarapuu (Centre Party), Siim Pohlak (Estonian Conservative People’s Party), Priit Sibul (Isamaa) and Indrek Saar (Social Democratic Party) took the floor.
Kallas criticised the lack of cooperation between the Government and the Riigikogu in the crisis situation. In her opinion, the problems should have been solved on a broader basis. Sarapuu thought that we had managed to keep the spread of the disease in check thanks to the understanding of the people. She expressed recognition to the Government. Pohlak thanked the Government and all the people who had adhered to the rules that had been set out. Sibul thought that the crisis had been overcome thanks to the Estonian people who had adhered to the rules set out by the Government.
In his opinion, we must assess the efficiency of the aid measures in hindsight and look at how they affected our economic situation. Saar also thanked all people, as they had behaved wisely and had been solidary. We have now reached the stage where we need to recover from the crisis. He drew attention to the Prime Minister’s pledge to build a more cohesive society, and referred to the people’s the economic difficulties.
In his closing remarks, Prime Minister Jüri Ratas addressed the issues that had been raised in the debate.
The Riigikogu passed two Acts
The Act on Amendments to the Product Conformity Attestation Act (125 SE), initiated by the Government, implements in Estonia the new directly applicable EU Regulation that replaces the Regulation that was in force before and concerns the mutual recognition of the conformity of goods marketed in another Member State. The Regulation helps stimulate trade in goods in the European single market and speed up and enhance the work of competent authorities in the evaluation of goods. The implementation of the new Regulation will make it simpler for Estonian economic operators to take their products to the EU market.
According to the principle of mutual recognition, products that have been placed on the market in a Member State under the rules in force there must be allowed to be freely placed on the market in EU Member States also when different requirements have been established for them in the country of destination. The Act provides for the right of competent authorities to prohibit goods from being placed on the market and to require withdrawal of goods from the market in Estonia in pursuance of the procedure provided for in the directly applicable Regulation. Based on the Regulation, competent authorities must clearly justify restriction on market access. This can be done for example on the basis of overriding reasons of public interest, and it must be evaluated whether the restrictions are proportionate to the aim pursued.
For example, the Consumer Protection and Technical Regulatory Authority, the Health Board, the Maritime Administration, the Agricultural Board, the Environmental Inspectorate, the Road Administration and the Veterinary and Food Board will be the competent authorities on the basis of the legislation regulating the sector. In addition, the Act regulates the obligation of these authorities to exchange information with the competent authorities of other Member States.
83 members of the Riigikogu were in favour of passing the Act.
The Act on Amendments to the General Part of the Civil Code Act and Other Acts (extension of the electronic options in the organisation of meetings and the making of decisions) (180 SE), initiated by the Government, extends the opportunities for all bodies of legal persons to make decisions without the need to hold regular meetings that require physical presence.
The explanatory memorandum notes that although the need to draft the Act became apparent particularly clearly during the emergency situation declared on 12 March, the solutions proposed in the Act are also meant to be used after the end of the emergency situation.
The Act eliminates the requirement that the list of participants in the general meeting which is an appendix to the minutes of the general meeting of members of a non-profit association must be signed in handwriting. With the amendment, the requirements for the preparation of the minutes and the registration of participants in the general meeting of members of a non-profit association are harmonised with the requirements in place for other associations.
The Act also extends the deadline for submission of the annual report to 31 October 2020 for apartment associations, non-profit associations, foundations, commercial associations and companies.
The Act also contains an amendment to the Act on Amendments to the Commercial Code (transfer of share) under which the elimination of the formal requirement for a transaction constituting an obligation to transfer or pledge a share is enforced at the earliest opportunity. The elimination of the formal requirement for a transaction constituting an obligation to transfer or pledge a share needs to be enforced in short order because the notarial authentication of transactions has become complicated in the crisis situation due to the movement restrictions imposed by countries, as well as because the issuing of the documents of foreign countries and sending them to Estonia is requiring more time than usual.
81 members of the Riigikogu voted for the passage of the Act.
The Riigikogu concluded the first reading of a draft Resolution
The Draft Resolution of the Riigikogu “Implementation of the State Reform” (181 OE), submitted by the Government, which is intended to achieve effective governance with state reform. For that, it is necessary to develop e-governance, offer human-centered public services and ensure regional balance.
The aim of the state reform is to develop sustainable and efficient governance that takes into account the needs of the population. The aim is intended to be achieved through four courses of action. They are a future-oriented country, an adaptable and active country, a country oriented to the needs of the people, and a regionally balanced country.
According to the draft Resolution, strategic planning will have to be reorganised and the performance of the state tasks will have to be enhanced. The country’s central government, local authorities and their authorities will operate on the principle of partnership and will cooperate in every way in the provision of public services. Legislative drafting will need to be inclusive, knowledge-based and foreseeable, and be based on the principles of good legislative drafting. It is important to continue the strengthening of local authorities and to support voluntary mergers of local authorities.
During the debate, Siim Kiisler (Isamaa), Ivari Padar (Social Democratic Party), Jaanus Karilaid (Centre Party) and Henn Põlluaas (Estonian Conservative People’s Party) took the floor.
The sitting ended at 6.56 p.m.
Video recordings of the sittings of the Riigikogu can be viewed on the Riigikogu YouTube channel.
(Please note that the recording will be uploaded with a delay.)
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