Old loan comes due

TALLINN - Prime Minister Andrus Ansip stated on Nov. 4 that the loan of 185,000 dollars that Estonia will repay to Latvia should not be construed as Estonia’s “present” to the Republic of Latvia, reports Postimees Online. Estonia will pay back the loan that the exile government’s diplomatic representation in New York received from Latvia in the 1990s.

Ansip confirmed at a government press conference that the information about the loan, from the memoirs of diplomat Ernst Jaakson, has been proven. “No loan contracts were concluded, but it has been proven that Estonia’s Consulate General requested a loan and the Latvian embassy offered it. Money transfer has also been made,” said the Estonian prime minister. He added that, according to laws applicable back then, such moves were essentially equal to conclusion of a loan contract.

“Debts have to be repaid and we will certainly do it with this one. At the same time, I would like to emphasize that this will certainly not be a present to Latvia on the occasion of their Independence Day. It would be absolutely inappropriate to speak about presents when speaking of obligations,” he added.

The head of government added that back then, the loan was issued without an interest rate and without deadlines, and that means that Estonia has to pay back exactly 185,000 dollars. He also ruled out any options that if the State would pay back the loan that would equal the value of this amount 20 years ago.
The Estonian government at its Nov. 4 sitting took up the issue of the repayment of the loan given by the Latvian Embassy in Washington during the final years of the Soviet Union. The loan was received by the Estonian Consulate General in New York in 1989.

According to diplomat, linguist and writer Aarand Roos, who was the Estonian consul in New York from 1982 to 1995, by 1990 the money had run out which had been deposited in foreign banks by the occupied Estonian Republic, and it was not possible to prepare a budget for the following year.

In his memoirs, long-serving diplomat Ernst Jaakson wrote that he was forced to turn to his Latvian counterpart, Anatols Dinbergs, for help in the form of a loan of USD 185,000 from the Republic of Latvia. As Jaakson noted, Dinbergs gave the promise that Estonia would not be required to pay interest on the loan.