WEBVTT - Estonia Prime Minister Kristen Michal Talks Support for Ukraine in EU 0:00:02.520 --> 0:00:07.040 Bloomberg Audio Studios, podcasts, radio news. 0:00:07.800 --> 0:00:09.639 Prime Minister, thank you so much for taking the time 0:00:09.640 --> 0:00:12.520 and speaking to Bloomberg here the sidelines at the informal 0:00:12.960 --> 0:00:15.880 European Council meeting here in Cyprus. I'd like to get 0:00:15.920 --> 0:00:17.720 first an overview from you of kind of what the 0:00:17.760 --> 0:00:19.960 priorities are going into this meeting, What are the main 0:00:20.000 --> 0:00:22.880 points of discussions, What would you like to leave Cypress with. 0:00:24.320 --> 0:00:28.040 It's unofficial meeting, and that will mean that we'll be 0:00:28.120 --> 0:00:31.960 talking quite freely about Ukraine, and that is probably the 0:00:31.960 --> 0:00:36.320 most important topic what will be going on because today 0:00:36.360 --> 0:00:39.440 we had this monumental decision which was long awaited. Ninety 0:00:39.479 --> 0:00:45.760 billion package is decided and also twenty sanction package is decided, 0:00:45.840 --> 0:00:49.080 so that will mean that Ukraine will have its backing 0:00:49.600 --> 0:00:54.200 for a longer time. Also about security security of European Union, 0:00:54.320 --> 0:00:57.440 what are the plans I know that some of the 0:00:57.480 --> 0:01:00.560 member states are asking about the Article forty two went seven. 0:01:01.080 --> 0:01:05.520 What will be the practical sites according to this? And 0:01:06.480 --> 0:01:10.080 also probably energy is the topic because as everybody can 0:01:10.840 --> 0:01:17.080 see that this kind of instability in Hormus, europass about 0:01:17.400 --> 0:01:20.240 the gobble, less than five percent of itsclude oil coming 0:01:20.280 --> 0:01:22.920 from there. But for a longer period of time it 0:01:23.000 --> 0:01:29.800 will have impact on oil, gasoline, on gas and so on. 0:01:29.760 --> 0:01:30.480 And on Ukraine. 0:01:30.720 --> 0:01:32.840 You know, we had very sort of pessimistic period of 0:01:32.840 --> 0:01:36.520 time after December, after the sort of ninety billion was blocked. 0:01:36.520 --> 0:01:38.800 Now we've had suddenly the ninety billion before the twenty 0:01:38.880 --> 0:01:42.320 sanction PACs. Now sort of building on that momentum. What 0:01:42.319 --> 0:01:43.760 do you think is next year? I think that one 0:01:43.800 --> 0:01:47.039 of the big debates is about EU accession for Ukraine. 0:01:47.240 --> 0:01:48.960 They'd like to join by next year. Do you think 0:01:48.960 --> 0:01:50.480 that that's a real possibility. 0:01:52.280 --> 0:01:57.000 I would say that the start of the accession process 0:01:57.080 --> 0:02:01.920 probably would be the most important, and the end goal 0:02:02.120 --> 0:02:05.320 should be full membership that is quick clear for Ukraine 0:02:05.360 --> 0:02:09.520 from Alder and so on, Yes, we probably will be 0:02:09.560 --> 0:02:13.040 talking about this today and next meeting and so on. 0:02:13.960 --> 0:02:18.320 Our position is that we support Ukraine in European Union because, 0:02:18.480 --> 0:02:22.720 to be honests no other way, Ukraine belongs to Europe 0:02:22.880 --> 0:02:24.639 and Europe is stronger with Ukraine. 0:02:24.919 --> 0:02:27.640 And thinking about the twenty first sanction package, what should 0:02:27.639 --> 0:02:28.080 that contain. 0:02:29.880 --> 0:02:33.959 Our message is that this kind of full maritime services 0:02:34.040 --> 0:02:38.320 banned because to be honest, Estonia has been leading or 0:02:38.360 --> 0:02:42.560 being with other countries with fight against Russian set afleet. 0:02:42.800 --> 0:02:45.800 This is delivering a little bit less than half of 0:02:45.840 --> 0:02:50.360 Putins war chest money and also with Russian assets, so 0:02:50.480 --> 0:02:55.920 probably getting them off track with getting new money, fresh 0:02:56.000 --> 0:02:58.080 cash for waging the war, that probably would be the 0:02:58.080 --> 0:03:00.760 first thing and second thing goal. So added to that 0:03:00.800 --> 0:03:03.639 also the Russian X fighters banned from single area and. 0:03:03.560 --> 0:03:06.320 European air and thinking also about the energy crisis is 0:03:06.320 --> 0:03:08.760 obviously is in front of mind for a number of people. 0:03:08.960 --> 0:03:11.160 How severe do you judge this crisis to be? Because 0:03:11.160 --> 0:03:13.359 it seems that my impression is that there's a lot 0:03:13.360 --> 0:03:15.760 of wishful thinking in Europe, that there's a lot of 0:03:15.760 --> 0:03:17.280 hope that this is just going to not be a 0:03:17.280 --> 0:03:19.799 problem a few months from now. However, if it is 0:03:19.840 --> 0:03:22.720 we go into the winter and we have gas shortages, 0:03:22.760 --> 0:03:25.120 we have all kinds of shortages, it becomes very severe. 0:03:25.160 --> 0:03:28.080 How seriously do you judge this issue? 0:03:28.960 --> 0:03:33.280 To be honest, The longer the conflict lasts, the longer 0:03:33.320 --> 0:03:37.720 the influence will be. The influence will be on many tracks. 0:03:37.760 --> 0:03:41.080 The first one is probably immediate gas prices in the 0:03:41.080 --> 0:03:45.560 gas stations that will be felt. Everybody will be questioning 0:03:45.640 --> 0:03:49.840 about accises, taxes, and so on inside the contest because 0:03:49.840 --> 0:03:53.400 it's on the supply side. Second one is which will 0:03:53.400 --> 0:03:58.520 be impacting Central Europe and Eastern Europe, but the middle 0:03:58.560 --> 0:04:00.480 of the year and at the end of the is 0:04:00.560 --> 0:04:02.920 the cash prices because we need it for heating and 0:04:03.040 --> 0:04:06.320 energy production, and the prices up and so on. And 0:04:06.400 --> 0:04:09.520 the second track, which probably will be affected a good way. 0:04:10.160 --> 0:04:14.040 In every bad thing, there's also good side that renewables 0:04:14.760 --> 0:04:17.200 and the production of renewables will be going up. So 0:04:17.680 --> 0:04:21.720 things happening in Hormos probably right now the booster for renewables, but. 0:04:21.680 --> 0:04:23.880 That's a much sort of longer term vision. For example, 0:04:23.880 --> 0:04:26.280 in Estonia the last quarter there was a slight contraction. 0:04:26.400 --> 0:04:28.120 Do you think that it could cause, for example, a 0:04:28.240 --> 0:04:30.400 recession within Estonia. 0:04:30.640 --> 0:04:33.440 Depends pretty much so on Europe as a whole, because 0:04:33.520 --> 0:04:38.400 we are quite exporting nation and we are depending mainly 0:04:38.640 --> 0:04:42.200 on our markets, for example in Scandinavia, Finland, speeding and 0:04:42.240 --> 0:04:45.320 so on. Second thing is about the every war, which 0:04:45.400 --> 0:04:49.120 will be decided by central banks, because if the information 0:04:49.279 --> 0:04:51.960 will be going up, I would predict that central banks 0:04:51.960 --> 0:04:54.240 would not be in that kind of party that they 0:04:54.279 --> 0:04:57.120 were last time, but they will have to step up 0:04:57.240 --> 0:04:58.760 let's say at the autumn and so on. 0:04:58.839 --> 0:05:02.159 To make all so certain, as you get concerned about 0:05:02.160 --> 0:05:05.320 a smaller nation, for example, competing for supplies of fuel 0:05:05.360 --> 0:05:07.400 for against say you know, Germany or something like that, 0:05:07.520 --> 0:05:09.720 jet fuel has obviously been sort of front and center. 0:05:09.760 --> 0:05:11.440 How concerned you about supplies there? 0:05:12.760 --> 0:05:16.600 I would say that we have our system of this 0:05:16.800 --> 0:05:20.360 kind of reserves. Everybody probably has their own system with reserves. 0:05:20.600 --> 0:05:24.600 So right now it's not yet a question about reserves 0:05:24.680 --> 0:05:30.320 and supply, but it could be if the conflict is prolonged, 0:05:30.360 --> 0:05:34.799 for example, Ye two, something that will have an impact. 0:05:34.880 --> 0:05:39.440 But in this kind of economy, you always know that 0:05:39.960 --> 0:05:44.360 the price which is coming from supply and demand will 0:05:44.400 --> 0:05:47.440 also have its impact. So you will see certain flights canceled, 0:05:47.600 --> 0:05:51.480 you will see people buying less catoline, canceling different trips. 0:05:51.520 --> 0:05:54.760 So this will also have this kind of elasticity in economy. 0:05:54.800 --> 0:05:56.880 And thinking about the source of this crisis, the war 0:05:56.920 --> 0:05:59.160 in Iran, there's been a lot of debate. Sometimes we 0:05:59.240 --> 0:06:01.240 hear from the President of the United States is sometimes 0:06:01.320 --> 0:06:03.880 very upset that Europe and NATA are not involved in 0:06:03.880 --> 0:06:04.680 the straight upform mood. 0:06:04.720 --> 0:06:06.040 Sometimes he's indifferent about it. 0:06:06.200 --> 0:06:07.800 What do you think Europe's role should be in the 0:06:07.800 --> 0:06:09.960 straight UPFORMOD should they answer the President of the United 0:06:09.960 --> 0:06:10.600 States's call. 0:06:11.480 --> 0:06:16.200 I would say that Europe has already talked that. Last 0:06:16.240 --> 0:06:20.160 week we were in a meeting by Emanuel mccron gives Starman, 0:06:20.839 --> 0:06:24.880 another's with if Metz chose Malone and so on, and 0:06:25.040 --> 0:06:28.400 the message was that Europe is able and willing to participate. 0:06:28.480 --> 0:06:30.960 And we have also been saying to the States that 0:06:31.520 --> 0:06:36.000 if all participation is needed, for example in the mining 0:06:36.040 --> 0:06:40.200 and so on, that's also possibility. But the States has 0:06:40.240 --> 0:06:43.680 not been asking us. So I would say that Europe 0:06:43.760 --> 0:06:47.080 is willing probably to step up in certain questions, but 0:06:48.720 --> 0:06:51.720 the question is about the capabilities, for example, once again 0:06:51.760 --> 0:06:52.880 the mining or something like that. 0:06:52.920 --> 0:06:56.159 And your Defense Minister spoke recently with the Secretary of Defender, 0:06:56.240 --> 0:06:58.919 Secretary of War Pete Hegseth in the United States and 0:06:58.920 --> 0:07:01.839 they told you that be delayed some of the delivery 0:07:01.839 --> 0:07:04.960 of ammunition and other hardware. At what point does that delay? Well, 0:07:04.960 --> 0:07:06.680 first of all, what kind of problem does that pose 0:07:06.760 --> 0:07:09.320 for Estonia? And at one point for how much time 0:07:09.560 --> 0:07:11.240 then do you have to start thinking about getting that 0:07:11.280 --> 0:07:12.720 supply from somewhere else. 0:07:14.160 --> 0:07:20.560 We have quite this kind of diffused buying of AMMO 0:07:20.880 --> 0:07:26.320 and weaponry, but certain weaponry is coming and hopefully coming 0:07:26.680 --> 0:07:29.480 soon from the States. But we also understand the position 0:07:29.560 --> 0:07:32.280 and needs because if they are in conflict and they 0:07:32.280 --> 0:07:36.800 are running out of AMMO capabilities there so everybody probably 0:07:36.840 --> 0:07:39.560 can understand their own motivation to say, even due to 0:07:39.600 --> 0:07:42.360 the best allies, that we are still waiting because as 0:07:42.360 --> 0:07:45.560 you can remember, President Somemp has this message that the 0:07:45.640 --> 0:07:48.520 country is contributing more to their own defense. Are up 0:07:48.560 --> 0:07:50.440 to this line or at the front of the line, 0:07:50.480 --> 0:07:53.600 and estone is there. But we also can understand and 0:07:53.640 --> 0:07:57.200 so that probably will mean that our blandness will have 0:07:57.320 --> 0:08:00.600 to decide that can be substitute this Will we wait 0:08:00.680 --> 0:08:01.880 for something so that. 0:08:02.240 --> 0:08:03.600 You have a time frame in mind at which one 0:08:03.600 --> 0:08:04.400 it becomes critical. 0:08:06.280 --> 0:08:10.960 Probably it's more technical question, not still critical question. 0:08:11.080 --> 0:08:12.679 And just the final question about NATO. 0:08:13.120 --> 0:08:15.840 You know, President Trump has repeatedly recently been calling NATO 0:08:15.880 --> 0:08:18.560 a paper tiger. That has prompted a lot of discussions 0:08:18.880 --> 0:08:22.360 within European allies and that article forty two seven, how 0:08:22.400 --> 0:08:24.760 do you view that within the European treaty, does there 0:08:24.760 --> 0:08:27.080 need to be not an alternative to NATO? But another 0:08:27.120 --> 0:08:29.600 sort of pillar of defense within Europe that needs to 0:08:29.600 --> 0:08:31.680 be operationalized and be taken more seriously. 0:08:32.160 --> 0:08:35.559 I would say that Europe is mainly based on NATO's 0:08:35.600 --> 0:08:38.360 defense plans and it's working well, to be honest, because 0:08:38.520 --> 0:08:42.600 we have practical experience. We had Russian meeks in our airspace, 0:08:42.720 --> 0:08:50.000 we had NATO's air policing, you know, our area, and 0:08:50.080 --> 0:08:52.360 the Italian F thirty five is the most modern they 0:08:52.400 --> 0:08:55.040 are and up and diverted Russian planes. And at the 0:08:55.080 --> 0:08:58.640 same time we have NATO ships on the sea which 0:08:58.679 --> 0:09:02.360 are protecting different kind of critical infrastructure. So on the 0:09:02.400 --> 0:09:06.719 practical and military level, NATO's working absolutely well. But at 0:09:06.720 --> 0:09:09.560 the same time, this kind of Article forty two seven 0:09:09.679 --> 0:09:12.960 has been invoke prob only once when France did that. 0:09:13.200 --> 0:09:16.000 And also that means the same thing that they need 0:09:16.040 --> 0:09:19.200 certain assistance from European countries and that can also be done. 0:09:19.400 --> 0:09:22.120 So if there's discussion about it, that's okay. But I 0:09:22.160 --> 0:09:24.679 would say these processes are parallel, not against US. 0:09:24.840 --> 0:09:26.080 I'm just a sort of final thought. 0:09:26.160 --> 0:09:28.640 Yeah, on the question of Russia in the threat, there's 0:09:28.679 --> 0:09:31.400 been some sort of high profile officials within Russia who've 0:09:31.400 --> 0:09:34.000 made some threatening sort of gestures sort of the Baltics recently. 0:09:34.160 --> 0:09:36.080 Do you feel a greater threat from Russia at the 0:09:36.080 --> 0:09:37.920 moment than you have over the last four years? 0:09:37.920 --> 0:09:39.440 How is that developing in your perspective? 0:09:39.800 --> 0:09:42.600 I would say that the thread level stays the same. 0:09:43.400 --> 0:09:46.320 We know that there's no immediate threat. We are prepared. 0:09:46.440 --> 0:09:50.160 We are well prepared to bonus because our deferense experiences 0:09:50.160 --> 0:09:52.760 is already five point focus and in the Baltics is 0:09:52.800 --> 0:09:56.680 the same lot. Weallyituania are doing the same, Poland Thinn sweets. 0:09:57.040 --> 0:09:59.720 Everybody is well prepared and we have good allies in 0:09:59.760 --> 0:10:03.760 you K, France, Germany, Poland so on, so we know 0:10:04.120 --> 0:10:08.480 what we're up against. But that's it. I would say 0:10:08.480 --> 0:10:12.880 that Russia is still acute threat to everybody in the 0:10:12.880 --> 0:10:13.520 civilized word.