MOSCOW – Estonia’s prime minister resigned on Wednesday, his coalition government of right-wing centrists and populists engulfed by a corruption scandal over the misuse of state loans to alleviate the coronavirus pandemic.
The departure of Prime Minister Juri Ratas signaled an unusual outbreak of political turmoil in a country that joined the European Union and also NATO in 2004, establishing itself as a bastion of pro-Western stability on Russia’s western border.
It is highly unlikely that this orientation will change, as the most likely successor to Ratas, the leader of the opposition center-right Reform Party, Kaja Kallas, is a staunch supporter of the American-led military alliance. Estonia’s president asked Kallas on Wednesday to form a new government, but it was unclear whether she would be able to get the necessary votes in parliament.
The outgoing prime minister, Ratas, has headed the tiny Baltic nation government since 2016 as the leader of the Center Party, whose strongest support base has been a large ethnic Russian population who liked its sometimes left-wing policies.
He resigned after reports that his party was among those under criminal investigation over loans from a state agency, KredEx, for a privately owned project in the port area of Tallinn, Estonia’s capital on the Baltic Sea. The money should go to companies hard hit by the pandemic.
Ratas intentionally denied having done anything wrong, but said that as a party leader, he would need to take “political responsibility” for any wrongdoing.
One of the suspects in the case is an aide to finance minister Martin Helme, a far-right politician who leads another party in the coalition and once described his immigration policy as: “If you’re black, come back.”
The inclusion of Helme’s EKRE party in the government, which severely damaged Estonia’s liberal image, came after an election in 2019 in which the Rats Center Party performed poorly but managed to remain in power by forming a coalition with the far right and a rival dominant conservative party.
Since the collapse of the Soviet Union in 1991, of which Estonia and two other Baltic states were a part, the country has built a strong economy, becoming one of the most connected and technologically advanced nations in the world.
Unlike neighboring Latvia, which has been hit by a long series of scandals related to its large financial sector, Estonia has enjoyed a reputation for clean government and finance, although it was badly damaged in 2018 when the Estonian branch of Danske Bank of Denmark was caught in an international investigation into the laundering of billions of dollars.