Article: In a bear's paw: Estonia. (relations between Estonia and Russia)

IF ONLY we had Estonia's worry, people in the other parts of the ex-Soviet Union must be saying. Estonia's economy is in danger of overheating. Officially, GDP is expected to grow by 6% this year; but, if you add in unrecorded activity in the private sector real growth may top 10%. A glance at our table displays a picture of dazzling success compared with the performance of Estonia's old colonial master, Russia.

Estonia's progress is largely due to a textbook application of financial conservatism and economic liberalism. In both 1993 and 1994 it has had a budget surplus. This is just as well, since the central bank is forbidden by law to lend to the government; all ...

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