Letter to the Commissioner

Letter to the Commissioner for Economic and Monetary Affairs

Sir, recent Document (*):

EUROPEAN COMMISSION. 30.5.2012. COM(2012) 311 final provisoire Recommendation for a COUNCIL RECOMMENDATION on Estonia’s 2012 national reform programme and delivering a Council Opinion on Estonia’s stability programme for 2012-2015 {SWD(2012) 311}

is giving on page 6 following statement:

„ (15) In the context of the European Semester, the Commission has carried out a comprehensive (sic! ÜE) analysis of Estonia’s economic policy. It has assessed the stability programme and national reform programme. It has taken into account not only their relevance for sustainable fiscal and socio-economic policy in Estonia but also their compliance with EU rules and guidance, given the need to reinforce the overall economic governance of the European Union by providing EU-level input (sic! ÜE) into future national decisions. Its recommendations under the European Semester are reflected in recommendations (1) to (5) below.“

Unfortunately from the Macroeconomics point of view (**) the comprehensiveness in this Document seems to be insufficient in the analytical part and the recommendations input superficial compared with the EU-level overall economic governance knowledge structure:

a)      In the field of analysis there seems first of all to be several neglecting omissions first of of all in the studies of the quality of extant economic institutions/mechanisms (especially unbalanced taxing system, and statistical knowledge structure formation mechanism), also in the analysis of several fundamental macroeconomic indicators e.g.  convergence/divergence, sustainability (economic potential), and payments balance as well the international investment position, economic inequality etc.

b)       Unfortunately it seems that by providing EU-level input recommendations not enough of the EU-level complete socio-economic knowledge space has been exploited – recommendations for structural reforms (especially for the harmonization of economic mechanisms) are scanty and superficial – urgent competent recommendation are badly needed for instant reform of the Estonian tax system in the sense of harmonization of moral competition (e.g.minding 0-profit tax) with member countries, for enhancement of Estonian socio-economic sustainability/convergence, lowering the risks of domestic capital and labour flight and avoiding worsening of the Estonian international investment position (by that considering Estonian idiosyncrasies e.g. with the past occupational limbo generated anomalous ethnic heterogeneity, low quality public socio-economic knowledge structure etc (***)).

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(*) http://ec.europa.eu/europe2020/pdf/nd/csr2012_estonia_en.pdf

(**) http://www.ies.ee/iesp/No11/articles/08_Ulo_Ennuste.pdf

(***) http://tallinn.ester.ee/search~S1*est?/twhite+book/twhite+book

/1%2C3%2C4%2CB/frameset&FF=twhite+book+losses+inflicted+on+

the+estonian+nation+by+occupation+regimes+1940+1991&2%2C%2C2

and

http://www.sciencedirect.com/science/article/pii/S0362331996900336

 

Ülo Ennuste, ylo.ennuste@mail.ee

Tallinn, Estonia, 4.VI 12