The President of Republic of Estonia - Wishing strength to survive successfully in a world that is rapidly changing!

The last year has been a year of major changes – both in the world economy and in Estonia. The previous year, 2007, was very successful for us, but the current year, 2008, signifies the end of one economic growth cycle and the beginning of regeneration necessary for a new growth cycle.

It is very promising to be here today, among the most viable and successful entrepreneurs in the Estonian economy. Moreover, we have reason to celebrate today, because in a few moments, entrepreneurship prizes will be awarded to the best companies of last year.

But besides joy, the current situation is overshadowed by uncertainty. East and West from us, stock markets are crumbling to such an extent only those who can remember more than the past ten years can recall. Financial institutions that only recently were considered to be the foundations of a successful and functioning economic system are collapsing.

In Estonia, we see difficulties with matching the revenue and expenditure of the state budget, because the economic growth we have become accustomed to has slowed down. Our familiar logic behind the drafting of the state budget, including the planning of revenue and expenditure, is significantly more difficult and causing more tension than during the last years of success.

During the past decade, the Estonian economy has sometimes had success that has been miraculous. Today, our feet are firmly on the ground again. The way things have turned out obliges us to ask two things: have we overlooked something or have we done something wrong? Or is all this just an inevitability?

Our success so far has to a great extent been a result of the advantages that were meant to disappear eventually, such as very cheap labour force or low debt burden. Those were the advantages of a transitory economy as compared to more mature economies; but in essence those advantages were temporary and they had to be used to their full extent. Regarding that, we have managed well. But the economic situation today – even without the problems of world economy – seems to be saying that passing one exam with flying colours does not put us among wealthy countries. There is more to be done in order to achieve that position.

The turning points in economy are difficult times, but they also contain opportunities for the future. Let us remember that the successful solutions to the economic problems of our Nordic neighbours at the beginning of the 90s were the basis for their success today. And in this case, it is not about economy in the narrow sense. Namely, the Nordic countries are one of the few countries in Europe today where social issues and labour market policies have also been successfully addressed and whose state budget is sustainable even in the conditions of an aging population.

The basis for all that was nevertheless the productivity of those economies, which in turn was based on their innovativeness, good education and advanced technology. Also, we should not forget that the great transparency of those societies causes the corruption level to be low; and where there is less corruption, there is a better economy.

This year we have often read from reputable sources that the structure of the Estonian economy has not managed to be up-to-date with great changes in other areas. This structure has remained unchanged in most areas. With the economic structure Estonia has today, it is very difficult – if not impossible – for this country to be among the truly developed countries. The structure of an economy is not something that can be changed overnight and by demand. Changes must instead be the result of thorough and thoughtful long-term work, taking into account one’s own and the entire world’s future needs.

It would certainly mean investments into education, research and development. It might also mean a need for changes not only in investments but also in general values.

Now is not the time for accusations or finger pointing, not even between politicians and entrepreneurs, who should really be each other’s partners in a democratic society. Accusations against one another and the constant reminders of possible miscalculations do not move Estonia forward. But we have to keep moving. Pessimism, being confused and looking for someone to blame would make us stop. That in turn would mean lost time and missed opportunities. We do not have any time to lose.

How to move forward? Do not look back at the past, but open your eyes and minds to new opportunities. These opportunities exist, one just has to know how to notice them and learn how to use them. It is namely because of this that I am happy to see several innovative companies among the nominees of today’s awards and I’m sure that those kinds of enterprises are the winners of the main prizes.

In conclusion I would like to wish all entrepreneurs strength to survive successfully in a world that is rapidly changing, and which is perhaps not in the most stable state at the moment. All of you are responsible for whether in ten years we can again talk about the Estonian economic miracle or not.

Toomas Hendrik Ilves