Estonia's geopolitical environment.

If the readers of this article cannot associate anything special with the name of Mart Laar, it is a tremendous lack of insight into modern economics.

While the former PM of Estonia is well known as the father of the Estonian Wirtschaftswunder, he is less known for his diplomatic skills. Mart Laar stands for straight talk; an attribute which sometimes hurt him during his time in office (1992-1994 and 1999-2002) but proved to be efficient in times of crisis.

If Estonia has shown the fastest year-to-year growth in the latest quarter within the EU (9,9%) and is today the fastest growing economy with stable institutions and a strong legal system, it is partly the result of the work of this tenacious character who never cared about opinion polls. Estonia has come a long way since its independence on August 21st, 1991. In 2005, Estonia has the clearest and certainly the most flexible fiscal system in the European Union, a 24% flat tax. It has dramatically cut bureaucracy and introduced competition in services, reduced subsidies and abolished restriction on foreign investment. The internet nation, which Estonia has become, is also a pioneer in e-government Rapidly and without concession, Estonia has also concluded its EU-integration (2003), NATO-membership (2004) and reformed its armed forces very similarly to its economy.

Even if the transition has been achieved successfully, Estonia still faces some social challenges: Health and social care as well as the protection of employees seem to be now on the agenda. The question of the rights of the Russian minority but also hesitation regarding the border treaty with the Russian Federation fuels the already difficult relations with its neighbor.

NATO Secretary General, Lord Robertson (left) greeting Mr. Mart Laar, March 22, 2000.

Estonian political culture: the totalitarian nightmares

Political debate and tone are very rough in Estonia. When it comes to attacking political figures ad hominem or to denunciating "collaborationists" (not a reference to Estonian members of the Waffen SS), anything goes. One can hear and read statements that are far from being in accordance with the European understanding of political culture. Recently, soccer fans wore T-Shirts demanding: "kommarid ahju", Estonian for "Communists to the ovens".

Like many peoples of the former Soviet Union, the Estonians suffered greatly from repression during what is known as the Red Terror. Within one sole year of occupation, the Soviet regime deported the entire Estonian elite to Siberian Gulags (10,000 men, women and even children), and c. 5% of the population (60,000 people) was literally erased by Stalin.

In 1941 the Armies of the Third Reich were greeted as liberators. Numerous Estonians who’d joined special task forces of the Wehrmacht later participated in the deportation of Jews and the liquidation of communist partisans in Eastern Europe. The victory of the allies over Nazi Germany enabled the return of the Soviet occupation and with it, terrible revenge was exacted upon the Estonian population. In 1991, Estonia finally found the way back to democracy.

The Estonian political culture and rhetoric seem to be the product of one totalitarian nightmare followed by another. This perhaps explains the lack of sensitivity, but certainly does not excuse it.

In 2005 one might expect from an EU member a careful handling of words such as "gas chambers" and "genocide".

But Mart Laar, like many politicians in his country, is a friend of short cuts and sentences. He would probably be less successful as a diplomat.

However he undoubtedly remains Estonia’s most successful Prime Minister.

There are many reasons why even non-transition economies should take note of what has been achieved by Mart Laar.

Unless, of course, they are afraid to.

"I am proud to have had the opportunity to serve my country."
Interview with Mart Laar, Prime Minister of the Republic of Estonia.

Visit to NATO by Mart Laar (left), Prime Minister of the Republic of Estonia, Brussels, Belgium, October 18, 1993.

WSN: Mr Laar, where were you on the day Estonia became independent?

Mart Laar: Estonia became independent on 24.2.1918 - I was not born then. When we restored our independence in August 1991, I was in Toompea Castle, at the Supreme Council, giving my vote to pass the decision.

WSN: We are told your motto is "just do it!". Did you have to make painful decisions while in office and what were they?

Mart Laar: To get my country out of this mess and collapse created by the communist system during 50 years of occupation demanded radical reforms - and as most medicines they were unpleasant at the beginning. But with time they worked well and made Estonia the most successful transition country.

WSN: How would you assess the economic co-operation with Russia? Could a cooling- off in Estonian - Russian relations be harmful to the Estonian economy, as Russian oil companies fear massive investments?

Mart Laar: Russian oil companies are actually investing without fear in Estonia, because there are open markets here and fair play - but we will never give any privileges to Russian companies in Estonia or to anybody else. The Russians had tried during more than a decade to develop an economic blockade and warfare against Estonia and failed. At the same time they helped to orientate the Estonian economy to the West, which has been very useful for Estonia.

WSN: Why is the reform process in many transition economies of post-Soviet states ‘stuck’?

Dmitry Udalov is Editor Russia of the World Security Network and Assistant in the Department of Economics in the Institute for US & Canadian Studies of the Russian Academy of Science in Moscow: "Why is the reform process in many transition economies of post-Soviet states ‘stuck’?"

Mart Laar: Because the governments put together from former communists are afraid to make decisions. You must make a clear break with the communist past when you can. My governments did this and even when we see some former communists back in power, all reforms which were done are there and are not reversed. That is most important.

WSN: Do you think the decision to build a pipeline from Russia to Germany was caused by uncertainty in relations between Russia and the Baltic states?

Mart Laar: This pipeline has anyway passed Estonia, so I do not think this is a problem. The reason lies in the Russian wish to show to Ukraine and Poland that Russia can do without them. At the same time, it is quite stupid to waste such vast amounts of money in this project, endangering the whole environment of the Baltic Sea.

WSN: Ethnic minorities in Estonia; are they treated according to EU standards?

Mart Laar: Had we not treated minorities according to EU standards, we could not be an EU member - this is very clear.

WSN: Is the main aim the eradication of the Russian language?

Mart Laar: No, the aim is the full knowledge of the Estonian language. The lack of this knowledge is the number 1 reason for unemployment for younger Russians - it must be taught more.

WSN: Will educational reform in fact close all non-Estonian schools in the country?

Mart Laar: Not at all. Estonia is in this respect more advanced than many European states. In France, the government is financing only French language schools. After the beginning of school reform in Estonia, education in Russian will be financed until high school, and only in high school will the process begin during which 60% will be taught in Estonian in the future.

WSN: Your comment on the recent incident with Estonian soccer fans wearing T-Shirts during a game asking to "send communists to the gas chambers":

Nathalie Vogel is WSN Correspondent Eastern Europe: "Mart Laar remains Estonia's most sucessful Prime Minister"

Mart Laar: This was not the text, but for many young people, the activities of the former communists and collaborationists is a problem - these T-shirts were their form of protest.

WSN: What’s the future of the Russian-Estonian border treaty?

Mart Laar: It is in the hands of Russia. This is no longer our problem but a Russian one. At some point, Russia must sign it and will sign it. How long it will take I really do not know.

WSN: Was there ever any doubt in your mind that Estonia should join NATO? Were you as Prime Minister ever tempted to consider the option of neutrality?

Mart Laar: No. We tried neutrality in the 1930s and consequently we were occupied by the Soviet Union, losing 20% of population as a result of this occupation and genocide. Never again.

WSN: Looking back at two legislatures as PM, any regrets?

Mart Laar: No regrets. I am proud to have had the opportunity to serve my country during those difficult times.