Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: Prime Minister, thank you so much for taking the time
Speaker 2: and speaking to Bloomberg here the sidelines at the informal
Speaker 2: European Council meeting here in Cyprus. I'd like to get
Speaker 2: first an overview from you of kind of what the
Speaker 2: priorities are going into this meeting, What are the main
Speaker 2: points of discussions, What would you like to leave Cypress with.
Speaker 3: It's unofficial meeting, and that will mean that we'll be
Speaker 3: talking quite freely about Ukraine, and that is probably the
Speaker 3: most important topic what will be going on because today
Speaker 3: we had this monumental decision which was long awaited. Ninety
Speaker 3: billion package is decided and also twenty sanction package is decided,
Speaker 3: so that will mean that Ukraine will have its backing
Speaker 3: for a longer time. Also about security security of European Union,
Speaker 3: what are the plans I know that some of the
Speaker 3: member states are asking about the Article forty two went seven.
Speaker 3: What will be the practical sites according to this? And
Speaker 3: also probably energy is the topic because as everybody can
Speaker 3: see that this kind of instability in Hormus, europass about
Speaker 3: the gobble, less than five percent of itsclude oil coming
Speaker 3: from there. But for a longer period of time it
Speaker 3: will have impact on oil, gasoline, on gas and so on.
Speaker 1: And on Ukraine.
Speaker 2: You know, we had very sort of pessimistic period of
Speaker 2: time after December, after the sort of ninety billion was blocked.
Speaker 2: Now we've had suddenly the ninety billion before the twenty
Speaker 2: sanction PACs. Now sort of building on that momentum. What
Speaker 2: do you think is next year? I think that one
Speaker 2: of the big debates is about EU accession for Ukraine.
Speaker 2: They'd like to join by next year. Do you think
Speaker 2: that that's a real possibility.
Speaker 3: I would say that the start of the accession process
Speaker 3: probably would be the most important, and the end goal
Speaker 3: should be full membership that is quick clear for Ukraine
Speaker 3: from Alder and so on, Yes, we probably will be
Speaker 3: talking about this today and next meeting and so on.
Speaker 3: Our position is that we support Ukraine in European Union because,
Speaker 3: to be honests no other way, Ukraine belongs to Europe
Speaker 3: and Europe is stronger with Ukraine.
Speaker 2: And thinking about the twenty first sanction package, what should
Speaker 2: that contain.
Speaker 3: Our message is that this kind of full maritime services
Speaker 3: banned because to be honest, Estonia has been leading or
Speaker 3: being with other countries with fight against Russian set afleet.
Speaker 3: This is delivering a little bit less than half of
Speaker 3: Putins war chest money and also with Russian assets, so
Speaker 3: probably getting them off track with getting new money, fresh
Speaker 3: cash for waging the war, that probably would be the
Speaker 3: first thing and second thing goal. So added to that
Speaker 3: also the Russian X fighters banned from single area and.
Speaker 2: European air and thinking also about the energy crisis is
Speaker 2: obviously is in front of mind for a number of people.
Speaker 2: How severe do you judge this crisis to be? Because
Speaker 2: it seems that my impression is that there's a lot
Speaker 2: of wishful thinking in Europe, that there's a lot of
Speaker 2: hope that this is just going to not be a
Speaker 2: problem a few months from now. However, if it is
Speaker 2: we go into the winter and we have gas shortages,
Speaker 2: we have all kinds of shortages, it becomes very severe.
Speaker 2: How seriously do you judge this issue?
Speaker 3: To be honest, The longer the conflict lasts, the longer
Speaker 3: the influence will be. The influence will be on many tracks.
Speaker 3: The first one is probably immediate gas prices in the
Speaker 3: gas stations that will be felt. Everybody will be questioning
Speaker 3: about accises, taxes, and so on inside the contest because
Speaker 3: it's on the supply side. Second one is which will
Speaker 3: be impacting Central Europe and Eastern Europe, but the middle
Speaker 3: of the year and at the end of the is
Speaker 3: the cash prices because we need it for heating and
Speaker 3: energy production, and the prices up and so on. And
Speaker 3: the second track, which probably will be affected a good way.
Speaker 3: In every bad thing, there's also good side that renewables
Speaker 3: and the production of renewables will be going up. So
Speaker 3: things happening in Hormos probably right now the booster for renewables, but.
Speaker 2: That's a much sort of longer term vision. For example,
Speaker 2: in Estonia the last quarter there was a slight contraction.
Speaker 2: Do you think that it could cause, for example, a
Speaker 2: recession within Estonia.
Speaker 3: Depends pretty much so on Europe as a whole, because
Speaker 3: we are quite exporting nation and we are depending mainly
Speaker 3: on our markets, for example in Scandinavia, Finland, speeding and
Speaker 3: so on. Second thing is about the every war, which
Speaker 3: will be decided by central banks, because if the information
Speaker 3: will be going up, I would predict that central banks
Speaker 3: would not be in that kind of party that they
Speaker 3: were last time, but they will have to step up
Speaker 3: let's say at the autumn and so on.
Speaker 2: To make all so certain, as you get concerned about
Speaker 2: a smaller nation, for example, competing for supplies of fuel
Speaker 2: for against say you know, Germany or something like that,
Speaker 2: jet fuel has obviously been sort of front and center.
Speaker 1: How concerned you about supplies there?
Speaker 3: I would say that we have our system of this
Speaker 3: kind of reserves. Everybody probably has their own system with reserves.
Speaker 3: So right now it's not yet a question about reserves
Speaker 3: and supply, but it could be if the conflict is prolonged,
Speaker 3: for example, Ye two, something that will have an impact.
Speaker 3: But in this kind of economy, you always know that
Speaker 3: the price which is coming from supply and demand will
Speaker 3: also have its impact. So you will see certain flights canceled,
Speaker 3: you will see people buying less catoline, canceling different trips.
Speaker 3: So this will also have this kind of elasticity in economy.
Speaker 2: And thinking about the source of this crisis, the war
Speaker 2: in Iran, there's been a lot of debate. Sometimes we
Speaker 2: hear from the President of the United States is sometimes
Speaker 2: very upset that Europe and NATA are not involved in
Speaker 2: the straight upform mood.
Speaker 1: Sometimes he's indifferent about it.
Speaker 2: What do you think Europe's role should be in the
Speaker 2: straight UPFORMOD should they answer the President of the United
Speaker 2: States's call.
Speaker 3: I would say that Europe has already talked that. Last
Speaker 3: week we were in a meeting by Emanuel mccron gives Starman,
Speaker 3: another's with if Metz chose Malone and so on, and
Speaker 3: the message was that Europe is able and willing to participate.
Speaker 3: And we have also been saying to the States that
Speaker 3: if all participation is needed, for example in the mining
Speaker 3: and so on, that's also possibility. But the States has
Speaker 3: not been asking us. So I would say that Europe
Speaker 3: is willing probably to step up in certain questions, but
Speaker 3: the question is about the capabilities, for example, once again
Speaker 3: the mining or something like that.
Speaker 2: And your Defense Minister spoke recently with the Secretary of Defender,
Speaker 2: Secretary of War Pete Hegseth in the United States and
Speaker 2: they told you that be delayed some of the delivery
Speaker 2: of ammunition and other hardware. At what point does that delay? Well,
Speaker 2: first of all, what kind of problem does that pose
Speaker 2: for Estonia? And at one point for how much time
Speaker 2: then do you have to start thinking about getting that
Speaker 2: supply from somewhere else.
Speaker 3: We have quite this kind of diffused buying of AMMO
Speaker 3: and weaponry, but certain weaponry is coming and hopefully coming
Speaker 3: soon from the States. But we also understand the position
Speaker 3: and needs because if they are in conflict and they
Speaker 3: are running out of AMMO capabilities there so everybody probably
Speaker 3: can understand their own motivation to say, even due to
Speaker 3: the best allies, that we are still waiting because as
Speaker 3: you can remember, President Somemp has this message that the
Speaker 3: country is contributing more to their own defense. Are up
Speaker 3: to this line or at the front of the line,
Speaker 3: and estone is there. But we also can understand and
Speaker 3: so that probably will mean that our blandness will have
Speaker 3: to decide that can be substitute this Will we wait
Speaker 3: for something so that.
Speaker 2: You have a time frame in mind at which one
Speaker 2: it becomes critical.
Speaker 3: Probably it's more technical question, not still critical question.
Speaker 1: And just the final question about NATO.
Speaker 2: You know, President Trump has repeatedly recently been calling NATO
Speaker 2: a paper tiger. That has prompted a lot of discussions
Speaker 2: within European allies and that article forty two seven, how
Speaker 2: do you view that within the European treaty, does there
Speaker 2: need to be not an alternative to NATO? But another
Speaker 2: sort of pillar of defense within Europe that needs to
Speaker 2: be operationalized and be taken more seriously.
Speaker 3: I would say that Europe is mainly based on NATO's
Speaker 3: defense plans and it's working well, to be honest, because
Speaker 3: we have practical experience. We had Russian meeks in our airspace,
Speaker 3: we had NATO's air policing, you know, our area, and
Speaker 3: the Italian F thirty five is the most modern they
Speaker 3: are and up and diverted Russian planes. And at the
Speaker 3: same time we have NATO ships on the sea which
Speaker 3: are protecting different kind of critical infrastructure. So on the
Speaker 3: practical and military level, NATO's working absolutely well. But at
Speaker 3: the same time, this kind of Article forty two seven
Speaker 3: has been invoke prob only once when France did that.
Speaker 3: And also that means the same thing that they need
Speaker 3: certain assistance from European countries and that can also be done.
Speaker 3: So if there's discussion about it, that's okay. But I
Speaker 3: would say these processes are parallel, not against US.
Speaker 1: I'm just a sort of final thought.
Speaker 2: Yeah, on the question of Russia in the threat, there's
Speaker 2: been some sort of high profile officials within Russia who've
Speaker 2: made some threatening sort of gestures sort of the Baltics recently.
Speaker 2: Do you feel a greater threat from Russia at the
Speaker 2: moment than you have over the last four years?
Speaker 1: How is that developing in your perspective?
Speaker 3: I would say that the thread level stays the same.
Speaker 3: We know that there's no immediate threat. We are prepared.
Speaker 3: We are well prepared to bonus because our deferense experiences
Speaker 3: is already five point focus and in the Baltics is
Speaker 3: the same lot. Weallyituania are doing the same, Poland Thinn sweets.
Speaker 3: Everybody is well prepared and we have good allies in
Speaker 3: you K, France, Germany, Poland so on, so we know
Speaker 3: what we're up against. But that's it. I would say
Speaker 3: that Russia is still acute threat to everybody in the
Speaker 3: civilized word.