Estonia keen to pay off national debt by 2010

  • 2005-08-03
  • Baltic News Service
TALLINN - Writing on the opinion page of the country's leading business daily, former Finance Minister Taavi Veskimagi has advised the government to settle the national debt by 2010.

"We could set ourselves the goal of settling… the whole national debt by 2010 so as not to leave it for the coming generations to pay," Veskimagi, a member of Res Publica, wrote in Aripaev. "This would be fair to our children."

As he explained, Estonia, which has been operating with a budget surplus for several years, should think more about its future now that it has a healthy economy. "Estonia is about to step onto a slippery slope 's when the economy fares well the state's operating costs are bloated, and when the inflow of tax revenues is no longer growing at the same pace we'll be in trouble," he said.

By amassing property and savings in good times, however, Estonia could also cope when setbacks hit the world economy, he added.

Finance Minister Aivar Soerd responded to his predecessor's suggestion by saying that, at the current pace, the national debt could be paid in full by 2010.

"At present talks are in progress with Nordic Investment Bank over the repayment of two loans this year," Soerd told the Baltic News Service.

According to Eurostat date, Estonia has the smallest public sector debt. The country's debt burden in 2004 was 4.9 percent (with GDP equaling 8.9 billion euros.)