Riigikogu discussed the activities of the Eesti Pank and the Financial Supervision Authority
The Vice-President of the Riigikogu Kristiina Ojuland made a statement in front of the Riigikogu announcing that she will concede her position as the Vice-President of the Riigikogu as she has been elected a member of the European Parliament.
The President of the Eesti Pank Andres Lipstok gave the Riigikogu an overview of the Estonian economic environment in 2008 as well as of the activities of the Eesti Pank in general. Mr Lipstok reminded the MPs that the main goal of the Eesti Pank, which belongs to the European System of Central Banks, is to ensure price stability in Estonia. This goal is hopefully achieved through strictly fixed Euro exchange rates, Monetary Committee system, and EU currency rates mechanism ERM II. According to Mr Lipstok, the decelerating of the rise in prices that had started in 2008 as well as the slowing down of the increase in consumer prices during the recent months has confirmed the judiciousness of our system. Eesti Pank predicts a decrease of the price level for this and the next year. “It is clear that no changes are made nor should be made to Estonia’s monetary policy or the relevant framework. The rate of the Estonian kroon will remain unchanged and we will join the Euro zone with the current exchange rate. Price stability is one of the paramount factors in supporting economic growth,” Mr Lipstok emphasised.
According to the President of the Eesti Pank, the second main goal of the bank was the stability of the financial system, particularly support to the reliability of the banking system. “Eesti Pank has kept the adequacy of the banks’ capital on the compulsory minimum 10 % level and has increased the obligatory reserves to 15 % of all the liabilities of banks. Up to now, the banks have held their own through the crisis. The current average capital adequacy of the Estonian banking system is over 22 %.” Mr Lipstok remarked that over the past six months Estonia has improved its possibilities to overcome the crisis, thanks to measures adopted in the private as well as the public sector. This is illustrated by the positive predictions of most rating agencies when it comes to Estonia, as well as the results of the recently completed IMF mission.
The annual report of the Financial Supervision authority was presented to the Riigikogu by the Chairman of the Boardof the Authority Raul Malmstein, who gave an overview of the changes taking place in the financial world and the consequent activities of the Authority. Mr Malmstein discussed the reasons for the global financial crisis and some of the lessons to be learned from it, as well as on the current situation in Estonia’s financial sector and the new initiatives and proposals.
On the motion of the Constitutional Committee as the leading committee, the second reading of the Emergency Bill (447 SE), initiated by the Government, was concluded. This Bill is a framework Act which deals with crises more generally, organises the legal bases for the crisis management system and introduces amendments to the organisation of the performance of crisis management duties both at the functional and territorial level. As a significant added value, the Bill regulates the ensuring of consistent functioning of vital services much more thoroughly than the Act which is currently in force, as well as the use of the Defence Forces for ensuring internal security in situations which have not been declared emergencies. The Bill was sent to the third reading.
On the motion of the Constitutional Committee as the leading committee, the second reading of the Bill on Amendments to the State of Emergency Act and the Code of Criminal Procedure (448 SE), initiated by the Government, was concluded. The purpose of the Bill is to update the regulation of the State of Emergency Act. Among other things, the Bill regulates situations related to mass disorders and specifies the definition of a threat to constitutional order and the bases for declaring it. For the purposes of this Bill, a violent mass disorder means carrying out of violent unlawful acts by a crowd, i.e. causing proprietary damage or carrying out activities that pose a threat to people’s lives or health. According to the Bill, in the case of mass disorders, the Government may decide on the use of the Defence Forces or the National Defence League until the termination of the state of emergency. The Bill was sent to the second reading.
See the verbatim record of the sitting (in Estonian):
The Riigikogu Press Service
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