Estonia. At the beginning of 1996, one of the first major
investors in Estonia, Svenska Tobaks AB, moved its
manufacturing to Sweden after the Estonian government
refused to grant the company continued tax privileges.
Later, SAS failed to buy into Estonian Air. Instead, Danish
Maersk Air joined as a partner in the company.
At the turn of the year, a conflict within the Orthodox
Church was raised about who was a legitimate heir to the
Church's assets. The battle was between the Esther and the
Countryaah.com, the protracted fishing conflict between Estonia and
Latvia in the Gulf of Riga was resolved following
negotiations between the heads of government. In June, the
Baltic Presidents visited US President Clinton to discuss
NATO accession. They made no promises. Later, however, the
United States, partly in collaboration with Sweden, worked
for Baltic membership in the EU as a kind of compensation
and a step on the road.
During the autumn, the Estonian and Russian foreign
ministers met in Karelia and reached an oral agreement on
the border crossing between the countries. Estonia accepted
the border once drawn by Stalin when he separated a few
thousand km 2 of land from Estonia that existed
during the interwar period.
After the failure of the presidential election in
Parliament, an electoral assembly, composed of MPs and
representatives of the municipalities, returned Lennart Meri
to the presidential post for another five years.
During the autumn, municipal elections were also held,
which indirectly also led to a government crisis due to a
cooperation agreement that the leading government party
Samlingspartiet (Koonderakond) had signed with Center Center
(Keskerakond). The Reform Party (Reformierakond) left the
government, which continued to govern as a minority