Estonia holds first post-Euro poll

Estonia holds its first election as a eurozone member today, with the centre-right government hoping for an unprecedented second term for steering one of Europe’s most depressed economies back to growth.

The Baltic country of 1.3 million became the 17th nation to adopt the euro on January 1 after enduring its deepest recession since regaining independence from the Soviet Union in 1991.

Economic output plunged a staggering 14% in 2009, leaving one in five workers without a job.

Fuelled by strong exports, growth has returned and the jobless rate has dropped, but at 14% it is still among the highest in the European Union.

Estonians appear to be have retained confidence in the two-party coalition of prime minister Andrus Ansip.

Recent polls suggest his centre-right Reform Party and its more conservative partner, known by its Estonian initials IRL, could win more than half of the votes and secure a majority in the 101-seat parliament. Currently they govern in a minority with 50 seats.

That would be a first in Estonia, where no government before Mr Ansip’s has served a full term since Western-style democracy was introduced following five decades of Soviet occupation.

“This has brought us political stability,” Mr Ansip, 54, told reporters on Thursday.

Mr Ansip has won approval both in European capitals and at home for his handling of the economic crisis, which ended years of roaring growth as a housing bubble popped and the global financial meltdown sapped all hopes of a quick recovery.

His government introduced tough austerity measures to bring down the deficit - it is now among the lowest in the 27-nation EU – and keep Estonia’s euro hopes on track.

The eurozone entry, capping a two-decade-long effort of closer integration with the West, was a strong boost for the government, even though it occurred in the midst of a European debt crisis.

Tonis Saarts, a political scientist at Tallinn University, said many voters credited Mr Ansip for bringing Estonia out of recession while “avoiding the fate of countries like Latvia or Hungary”, which had to seek bail-outs from international lenders.

Mr Ansip’s government survived another crisis, not long after the previous election in 2007, when he followed up on promises to relocate a Second World War memorial to Soviet soldiers killed in Estonia.

The move of the so-called Bronze Soldier drew sharp rebukes from Moscow and triggered mass protests among Estonia’s Russian-speaking minority, which makes up nearly one-third of the population. Hundreds were detained and dozens hurt as rioting youth clashed with police officers firing tear gas and rubber bullets.

Tensions have eased since, but Estonia remains divided by language. Those with Russian as their first language include Russians, Ukrainians, Belorussians and other ethnic groups who were relocated to Estonia during Joseph Stalin’s attempts to “Sovietise” the rebellious Baltic republics.

About 100,000 of them are not considered Estonian nationals, either because they do not meet the strict Estonian language requirements required for citizenship or do not want it.

Many of the Russian-speakers eligible to vote support the main opposition Centre Party, led by political veteran Edgar Savisaar. Polls show his party could finish in the top three, but it is unlikely to find coalition partners to form a government.

The most likely outcome is that Mr Ansip’s Reform Party and IRL remain in power, possibly with the support of the Social Democrats, the only centre-right party that wants to scrap Estonia’s flat-tax system for progressive taxation.