Off the wire

ESTONIAN IT TO MOVE EASTWARD: The Estonian Export Agency advised the country's IT companies to expand more vigorously to the Lithuanian market. Latvia is already catching up with Estonia, the agency's director Lea Kroonmann said. The Latvian government, for example, increased the IT education budget by 20 percent this year and beginning next year high-tech companies will get income tax allowances, she said. The state should work out a detailed strategy for the development of the IT sector to keep Estonia's lead over the other Baltic states, Kroonmann added. The turnover in the Lithuanian IT market last year was 732 million kroons as compared with the Estonian market's 1.3 billion kroons.

TIMBER COMPANIES RESULTS DOWN: Financial indicators of Latvian wood-processing companies are deteriorating rapidly, the Latvian Wood Processors Association reported last week. The deterioration was due to the recent fall in the euro exchange rate. European Union members and other European countries are the main sales market of the Latvian wood-processing industry. Export-related payments are made predominantly in euros while payments for imports are usually made in U.S. dollars.

SODRA IN THE RED: The Lithuanian state-run social insurance fund, Sodra, was running a budget deficit of 266 million litas ($ 66.4 million) in the first ten months of 2000, according to preliminary data. Budget revenues for the first 10 months of 2000 totaled 3.464 billion litas, 3.730 billion litas below the target. Expenditures came to 3.679 billion litas, or 2 percent (77 million litas) below the target. The fund's expenses exceeded revenues by 215 million litas. The average pension held steady at 312 litas over the nine-months of 2000. It is planned that the social insurance fund will run a budget deficit of 250 million litas in 2000.

LATVIA TOPS LOAN RATES: Latvia had the highest annual average weighted interest rates among the three Baltic states on short-term loans denominated in the local currency in August 2000, the Central Statistics Office reported. In August the rates in Latvia were 14.2 percent a year, in Lithuania 11.4 percent and in Estonia 7.3 percent. In August 1999 the respective rates in Latvia were 12.6 percent, in Lithuania 12.7 percent and in Estonia 11.9 percent. For long-term loans made in the national currency the annual average weighted interest rates in August 2000 were lowest in Estonia at 8.6 percent, while in Latvia 10.6 percent and in Lithuania 12.3 percent.

BALTIKA TO GO U.S.: The Tallinn-based clothing manufacturer Baltika has started selling its products in the United States as part of the company's plans to expand to new markets. Meelis Milder, chairman of the board of Baltika Group, told reporters in Tallinn on Nov. 2 that the firm sent in August to the United States a first wholesale consignment worth 1.8 million kroons ($ 98,700).

LATVIAN SHIPPING TO BE SOLD: Investors in the Latvian Shipping Company may get more than 50 percent of shares, Latvian Privatization Agency director general Janis Naglis told reporters Nov. 1. Six percent in shipping company should be sold to the company's staff and 15 percent of shares should be offered publicly against privatization vouchers,. he said. The agency's experts and international advisors are still drafting the rules for the company's privatization.

TELE2 TO GO BROADBAND: Swedish Ericsson will install a Broadband Wireless Access sub-station in Tallinn for Tele2, under an agreement both companies signed Nov. 3. After completion of the sub-station, Tele2 will start providing BWA-based online Internet linkups, data transmission solutions, local area network linkups starting next year. In the future the company will also offer telephone service. If the project is successful the company will expand the service to other parts of Estonia.

TRANSIT SHRINK CAUSES FIRES: Due to a sharp decline in the transit of Russian oil, Eesti Raudtee (Estonian Railway) has decided to send 80 employees, most of them engineers, on forced leave at 1,400 kroons (USD 76.5) a month without coordinating the move with the trade union, the Estonian business daily Aripaev reported.

The company has been in the red for two months. However, the management is reluctant to fire anyone because the situation could improve.

RIMI ENTERS VILNIUS: Nordic-owned Lithuanian food retailer Ekovalda opened its first Rimi supermarket Nov. 3 in Vilnius and plans to rename all of its 13 stores in a year. Another Rimi supermarket is to be opened at the Lithuanian city-port of Klaipeda later in the year. Ekovalda controls about 10 percent of Lithuania's retail food market. The Nordic concern ICA Ahold Holding controls 50 percent of the shares in Ekovalda. It owns supermarkets in more than 10 European countries, including Estonia, Latvia, Poland and the Czech Republic.