Changes began with the arrival in the country of European attributes and documents of the European model. The first to feel like EU residents were Estonian motorists, most of whom managed in just a few months to change their old vehicle registration plates to new ones with European symbols. Some also changed to European driving licenses and registration documents for their cars. Next in line is the obtaining of EU citizen passports, which will begin to be issued on August 1 of this year. In addition to documents, blue-starred European flags were hung on state institutions and border checkpoints of Estonia. However, all this is only the external attributes of EU membership. Much more significant for people was the opening of internal European borders.
Now, to cross the internal borders of the European Union, Estonian citizens do not need even visas (Estonia introduced a visa-free regime with the EU back in the mid-1990s), nor even foreign passports themselves. For this, internal identity documents of Estonian residents are quite sufficient. And they are not checked very carefully in the EU. All this greatly facilitated life for both tourists and Estonian businessmen, who got the opportunity to trade throughout the EU without duties and unnecessary border formalities. As a result, exports of Estonian enterprises to other countries of the union grew by 15% over the year.
In the financial sphere, Estonia's entry into the EU was perceived as a strengthening of market stability, which, in turn, led to a sharp decrease in interest rates on loans issued in the country. Estonian banks, owned mainly by Scandinavian concerns, began to offer, for example, real estate purchase loans for up to 40 years at 2-3% per annum, and almost all Estonian residents with a stable income can obtain them. Young Estonian families are already almost universally using this opportunity to purchase housing.
The "cheap money" that appeared in Estonia and the favorable economic environment became a magnet for foreign investors, including from Russia. Russians who opened their representative offices in Estonia over the past year directed their main investments into transit, mechanical engineering, and the chemical industry. An additional stimulus for the expansion of Estonian-Russian business cooperation was the abolition, since Estonia's entry into the EU, of the double customs duties imposed by Russia on Estonia in the early 90s for political reasons. As a result, trade turnover with Russia grew by 1.7 times over the year. At the same time, more and more European concerns began to transfer their production facilities and service centers to Estonia, which made it possible by the end of 2004, for the first time in many years, to reduce the unemployment rate in the country to 8.5%.
Due to joining the EU, Estonia's fame in the world also grew, and as a result, according to the Ministry of Economy, tourism turnover in the country increased by 24% over the year. Now tourism accounts for 12.5% of Estonia's exports, which is comparable to the figures of sunny Spain (15.1%) and Portugal (15.4%).
With the opening of internal European borders, Estonian citizens got the opportunity to work freely in some EU countries (some of the old EU countries introduced a transitional period for Estonian residents on the free movement of labor for a period of two to seven years). According to the Estonian Labor Market Department, about two thousand residents of the country went to work in the UK and Ireland alone over the year.
Together with joining the EU, Estonia gained access to multi-billion subsidies from the Union's structural funds. Every resident of the country can easily monitor the distribution of these funds in Estonia. Over the year, in all corners of the country, near roads, water treatment stations, thoroughly renovated buildings, power plants, rural farms, etc., signs with the blue-starred flag and an inscription appeared stating that this object was built (renovated, purchased) with funds from the European Union. Thus, the EU is pursuing a policy of "leveling" the standard of living of its new members with that of the founding states of the union. Only this year, the amount of EU subsidies invested in Estonia will exceed €3.5 billion, and in 2007-2013 it will amount to about €7 billion per year.
The biggest winners from EU membership were Estonian farmers. For the first time in many years, thanks to EU support, it became profitable to engage in agriculture in Estonia. The EU supports them both in acquiring equipment and bringing the premises necessary for peasant labor up to European standards, and in "pushing" products to the market. The opened opportunities led to the fact that, in addition to the Estonian farmers themselves, foreigners who saw a gold mine in this began to buy farms in Estonia.
Joining the EU also benefited Estonian pensioners, whose pensions began to grow rapidly thanks to the obligations taken by Estonia in connection with the signing of the European Social Charter. By April next year, the average pension in Estonia will be about €200.
Along with the positive aspects, joining the EU brought Estonians some disappointments. First of all, they are associated with the significant increase in prices for sugar and motor fuel that occurred immediately after joining the EU. In addition, the news that Estonia may face a fine from the European Commission for excess sugar reserves of about €65 million was very unpleasant for many Estonians. The fact is that on the eve of Estonia's accession to the EU, many local entrepreneurs, taking advantage of the government's inattention, in an effort to profit from the price difference, imported hundreds of tons of cheap sugar from abroad, and the EU is trying by all means to protect its producers of this product with the help of high customs duties. The fine threatening Estonia is precisely what will be used to compensate European producers for lost profits.
In addition, many in Estonia are greatly concerned by the beginning outflow of qualified medical professionals from the country, seeking to find better pay in hospitals in Scandinavian countries. Estonian bus drivers have also begun heading in large numbers to work in other EU countries. The Estonian government has already stated that it will do everything possible to stop the outflow of specialists, in particular by allocating additional funds to medicine to raise medical workers' salaries.
And yet, despite the difficulties of adjustment, joining the EU has clearly been beneficial for Estonia. Apparently, in the coming years the country's residents will feel the influence of the European Union even more. First of all, this will be connected with the introduction of the euro in Estonia on January 1, 2007. Also, the country's accession to the Schengen zone in 2008 and the removal of restrictions on the movement of labor by all EU states will be turning points. Whether Estonia will be able to pass these stages of its development just as successfully remains to be seen.