Land ban proposed

The People's Union, Estonia's largest political party, said last week it intended to launch a campaign to ban arable land sales to foreigners in a bid to help local farmers stay competitive.

People's Union Deputy Chairman Ants Kaarma said the party feared that foreigners would take advantage of Estonia's low land prices, squeezing out local farmers, and then keep the land fallow until they could sell at a profit.

A hectare of arable land that costs roughly 2,000 kroons ($125) in Estonia goes for nearly 50,000 kroons in nearby Finland, according to the Association of Estonian Farmers.

Party activists said they would start collecting signatures in August that they hope will persuade the Parliament and government to reopen the negotiation chapter with the European Union - closed in 2000 - that allows for such sales.

The signatures, Kaarma said, are not binding but could push Parliament into action if enough citizens get behind it.

He said the People's Union was targeting both urban and rural residents to sign the petition. "We think all the people are concerned about losing their country's land," he said.

The European Commission, the EU's executive arm, told candidate countries they could apply for transition periods on free movement of capital, under which land sales falls.

Local fears were stoked when Finnish business media called on Finns earlier this year to invest in Estonian agriculture in hopes that prices would skyrocket once the country joins the EU.

Kaarma said it was also possible to apply to buy land with a front group. Then, buyers can build residential complexes or manors, he said.

Interested buyers, he explained, may rent a state-owned plot, then file an application to buy it, making clear intentions to use it for agricultural purposes.

Once approved by local government, the land can be bought - sometimes for privatization vouchers - and then the owner is free to resell the land.

Kaarma may find some sympathetic ears in government. Environment Minister Heiki Kranich of the ruling center-right Reform Party said he was concerned about improper land use.

"Privatization of arable land brought many frauds, and we'd like to amend the law on land sale this year to make the control over land usage tougher," he said.

But Kranich stops short of backing a ban on sales to foreigners.

The land plot registry lists 912,755 hectares of arable land in Estonia but does not provide information about how much land belongs to foreign firms or individuals.

But the Agriculture Ministry said there were 80 agricultural companies with foreign capital in Estonia as of April 2002, and 60 of those involved Finnish capital. Others were from New Zealand, Ireland, Belgium, Sweden, Denmark, Germany and the United States.

According to Estonian law, local and county governments control land sales and issue all necessary permits, but revenues go to the national budget.

Estonia will hold municipal elections this October, but Kaarma says the land sales issue is not connected with campaign politics.