Opening of Norwegian Business Day

Prime Minister Vahi, Ladies and Gentlemen,

Prime Minister Vahi and I have agreed on a simple division of labour this morning. He will tell the Norwegians more about the opportunities that Estonia have to offer. I will explain to the Estonians why they should look to Norway.

The rest is up to you businessmen and women.

The primary objective of this seminar is matchmaking. We want to create new economic opportunities by matching the natural resources, technology and manpower of Norway and Estonia. We want a more diversified trade relationship. We want more investment opportunities which carry long-term promise.

We started almost from scratch in 1991, when Estonia regained its independence. There was hardly anything to build on in terms of contacts and networks between our two countries. We had been separated for five decades.

Today, Norway and Estonia are trading partners once again. We have revived commercial links dating back more than a thousand years. The Vikings used to sail by Tallinn on their way to and from Istanbul, what they called Miklagard. For centuries, Tallinn and Bergen belonged to the same economic entity - the Hanseatic League.

Statistics show that the trade between us is still quite modest. But we have to give ourselves some time. Fish is our main export to Estonia, whereas wood products, furniture, clothing, and textiles dominate the import from Estonia. Our common ambition is to continue the progress we have made since 1992.

Estonia serves as both a trading partner and a gateway to the markets further South and East. Take fish as an example. Some of the fish we sell is consumed here in Estonia, while some of it is being resold to Russia and other CIS countries.

Trade in raw materials is important. But industrial cooperation is also increasing. A number of Norwegian companies see investment opportunities in Estonia. They are encouraged by Estonia's successful transition to a market economy. They also point to Estonia's solid industrial base, skilled work force, and proximity to major European markets.

Let me give you a few examples of industrial cooperation involving Norwegian interests. I think all the companies in question are present here today. Some are also part of the business delegation accompanying me to Estonia.

The Norwegian State Oil Company, Statoil, is one of the largest foreign investors in the Baltics. By the year 2000, Statoil will have invested close to a billion Norwegian kroner in the three Baltic states. In Estonia, Statoil now operates ten petrol stations and employs about 200 people.

Nycomed, a world leader in pharmaceuticals, has established a subsidiary in Polva with the name Nycomed SEFA. This company has more than 60 employees and is now the leading supplier of high quality products to the Estonian market.

Five years ago, the Glamox company established a factory in Harju for the production of light fittings and heaters. Glamox Harju is now a market leader in Estonia and a major supplier to Latvia, Lithuania, and Russia.

Scancem International of the Aker Group owns 25 per cent of Kunda Nordic Cement Corporation, which produces cement for Estonia and international markets. Scancem will be investing 320 million Norwegian kroner over the next three years.

Pripps Ringnes has acquired a majority share in all the main breweries of the Baltic states, including Estonia's Saku brewery.

Alu-Rammer started to produce wooden picture frames in Rapla in 1993 with six employees. Today, a work force of 180 supplies picture frames to leading furniture chains in Norway, Sweden, and Finland.

The companies that I have mentioned, as well many other represented here today, have all made strategic decisions about long-term involvement in Estonia. They are ready to invest in both physical and human capital. They represent state-of-the-art technologies and management principles. They are reliable partners in progress and prosperity. They are one reason why Estonians should be looking to Norway.

Like Estona, Norway is heavily dependent upon foreign trade. Norway's natural resources - waterfalls, fish stocks, forrests, mineral resources, and offshore oil and gas - are the pillars upon which we have built our prosperity. But the most important resource today is human capital or people. For this reason, we are determined to strengthen our knowledge- based industries. Education is the key to further development. Knowledge is the ultimate resource and the human mind is the most important engine of growth and change.

The concept of life-long learning lies at the heart of the educational reforms which my Government is now implementing. We know that much of the technology we use today will be of little use in 20 years, whereas most of the work force will still be employed.

In Norway, we have created prosperity through a workable compromise between capital and labour. Our goal has been to humanise the market, extracting from it economic growth and job creation, while at the same time ensuring equal access to health care, social security and education. I believe that emerging economies like the Estonian will also need a strong public sector as a pillar of the national economy.

Earlier this year, our bilateral free trade agreement was turned into a multilateral free trade agreement between the EFTA countries and the Baltic states. This was another step towards establishing an open trade system in Europe, a system embracing the EU, EFTA, the Baltic states, and the countries of the Central European Free Trade Area.

I can assure you that Norway will continue to support the process of reform in Estonia. Through our Action Program for Eastern Europe we will continue to promote cooperation between Norwegian and Estonian companies. We have proposed that Parliament raise the ceiling on Norwegian investment and export guarantees to the Baltic States. This would create new opportunities to finance joint Norwegian-Estonian business projects.

Additional needs for financing would also be covered by the proposed establishment of an Investment Fund for Eastern Europe. If approved by Parliament, the Investment Fund would have an initial capital of 70 million Norwegian kroner.

I mention these financial possibilities to underline that you will have at your disposal several tools with which to work in order to complete a business transaction or make an investment. These tools are provided by a Norwegian government eager to promote closer economic relations with Estonia.

I hope today's seminar will result in increased economic cooperation between our two countries. I thank the staff of the Norwegian Trade Council for bringing us together. And I wish all of you the best of luck.

Thank you.