Posts Tagged ‘trade’


New Credit Becomes Available to Exporters

In Uncategorized on April 23, 2011 by admin Tagged: , , , , , , ,

BBN – At its April 21 meeting, the cabinet approved a proposal to launch a new subordinated credit scheme to support export-oriented companies. The “subordinated credit program” financed from the EU structural funds is meant for export-oriented Estonian companies that lack capital or sufficient securities to finance their project, or whose project is found to be too risky by credit institutions.

“Our objective is to improve access to capital. The subordinated loan instrument upholds growth and expansion of enterprises,” said Minister of Economic Affairs and Communications Juhan Parts.

Under the new program, two types of credit will be made available – subordinated loans for investment in technology, and subordinated loans integrated into the currently available entrepreneurship support package.

As a result of the recent economic downturn, many businesses have difficulties obtaining credit. For example in case of sophisticated technology investments, commercial creditors require a minimum contribution of 40 percent. But since turnover, profitability and capital dwindled during the crisis, self-financing capacity is still low. Nor have securities recovered their pre-crisis value. However, to prepare for the growth phase, investments are vitally needed for enhancing productivity and expanding into new international markets.

Since Enterprise Estonia’s technology investment program and other support measures have now ended, enterprises have been left high and dry, a problem the new instrument aims to correct.

The program, financed by the European Regional Development Fund, is worth approximately 27 million euros, and will be administered by KredEx in cooperation with banks and leasing companies. Loans for technology investment will be available in May, whereas companies qualifying for the support package are eligible for subordinated loans already.

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Euro money on its way to Estonia

In Uncategorized on May 16, 2010 by admin Tagged: , , , , , , , , , , ,

(BRUSSELS) – The European Commission will on Wednesday recommend that Estonia be allowed to adopt the common euro currency next year, as it meets all the economic criteria, a source close to the EU executive said.

The commission’s evaluation on Estonia’s bid to become the 17th member of the eurozone “is more than positive”, the source said.

The opinion of the European Union’s executive arm must still be endorsed by its fellow EU nations.

If they give the green light then the eurozone will have its first Baltic member state, and the third ex-communist state, and could do so on January 1, 2011.

Estonia would thus become the fifth of the 10 nations which joined the EU in 2004 to adopt the common currency; after Slovenia in 2007, Cyprus and Malta in 2008 and Slovakia last year.

In order to qualify, candidate nations must respect several criteria: keeping national debt and deficits under control as well as inflation, and limited fluctuations on foreign exchange markets and on interest rate levels.

According to the latest EU estimates, Estonia will post a public deficit amounting to 2.4 percent of gross domestic product this year and a debt of 9.6 percent of GDP, statistics which most of Europe can only dream of.

In comparison the eurozone average public deficit this year will be 6.6 percent and 84.7 percent for debt levels.

Estonia, with its 1.3 million inhabitants, had initially hoped to join the euro club in 2007, but was prevented from doing so by high inflation rates at the time.

Estonia shifted rapidly from a communist command economy to the free market after breaking from the crumbling Soviet bloc in 1991.

It won a reputation as an economic tiger, notably since joining the European Union.

Hit by the global crisis in 2008, Estonia’s government has slashed public spending to confront the crisis and maintain its drive to switch from the national currency, the kroon, to the euro.

The Tallinn government has said that Estonia has cleared all the EU’s hurdles for adopting the euro.

There has been speculation, however, that the eurozone’s current 16 nations could be wary about taking on a new member amid the Greek crisis.