The European Commission transferred its first structural fund payment of 353.5 million kroons (22.6 million euros) to Estonia on July 7 for increasing the efficiency of the country's economic development. The Finance Ministry stated the money would be used to cofinance structural fund projects. The next payments, to the tune of 227 million kroons - from the European Social Fund, the Agriculture Guidance and Guarantee Fund and the Financial Instrument for Fisheries Guidance - will be transferred by September at the latest. This year's Estonian state budget expects EU structural fund payments amounting to nearly 1.7 billion kroons.
Estonia sharply opposes attempts to introduce uniform taxation in the EU, European Commissioner candidate Siim Kallas said this week. Responding to German and French accusations that new member states were attracting businesses and jobs with tax dumping, Kallas said that in many case it was just the other way around. "Countries with a high tax burden are applying numerous tax reductions and tax exemptions, because of which companies do not have to pay any taxes at all. In the new member states such exemptions are forbidden; therefore, all companies must pay taxes in countries where the tax level is low. The situation is particularly unfair toward the new [member] states. Thus I'm for harmonization of the tax base," Kallas told Finland's Kauppalehti daily.
Lithuania has asked the European Commission to increase its national potato starch production quota from 3,640 tons per year to 4,860 tons per year, the country's Agriculture Ministry said. Rimantas Krasuckis, director of the ministry's single market organization department, said that the annual start production quota of 1,200 tons, set for the years 2004 to 2005, does not meet the market needs and is holding back the development of the domestic potato starch industry. The state did not start supporting local potato starch producers until Lithuania's accession to the European Union in May. The 2004-2005 quota calculations were based on Lithuania's starch production levels in 1998 and 1999, which were low because local producers could not compete with cheaper, subsidized EU imports.
The Latvian Transport Ministry and the Central Finance and Agreement Agency have signed a deal on implementing the state's first grade road development program - the Baltic state's initial agreement for using EU structural funds. Total program costs reach 51.8 million lats (77 million euros), of which 32.9 million lats will come from the EU's regional development fund. Finance Minister Oskars Spurdzins said he was glad the deal came through sooner than specialists previously expected, adding that new agreements and contracts would soon follow. The Transport Ministry reported that tenders for road construction work have already been announced, 18 contracts have already been signed and that the rest are to be clinched by the end of the year. Most of the program includes renewing asphalt on 240 kilometers of road.