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BNS – The annual growth in productivity in Estonia on the basis of production accelerated to 33.4 percent in the fourth quarter of 2010, Statistics Estonia said on Wednesday.

Productivity ratios in Estonia mainly declined in 2009, turning to growth in the final quarter of that year. During the course of 2010 growth became faster.

For all areas of business combined, labor productivity in the fourth quarter was 26,459 euros per employee. Measured in constant prices, this was 33.4 percent more than a year ago.

In manufacturing the rate of growth was 33.9 percent and in mining it was 15.3 percent. In the production of electric energy, steam and hot water supply productivity surged 44 percent.

The fastest growth rate was shown by the manufacture of computers and electronic devices, where the productivity indicator in the final quarter of the year was 220.9 percent higher than a year ago.

Also the labor productivity of personnel costs has increased significantly in Estonia in recent years. If in the first quarter of 2009 each euro spent on labor returned 5.22 euros in production, then in the fourth quarter of 2010 this indicator was 7.65 euros.

BNS – The supervisory board of the state owned company Port of Tallinn on Tuesday agreed to a proposal from the management board to have 400,000 cubic meters of new tanks for liquid cargoes built for the needs of the oil transit company AS Vopak E.O.S., which would enable to handle up to five million tons of oil products additionally per year.

The chairman of the supervisory board of Port of Tallinn, Neinar Seli, said Vopak E.O.S. has made large scale investments in development in recent years to maintain handling volumes and increase them. "In order to offer a high-quality service to traders and cargo owners, the terminal today needs primarily additional tank capacities for the storage and blending of products and additional quay resource for loading and unloading VLCC tankers," Seli said.

Vopak E.O.S. is the largest independent terminals operator in the Baltic countries and the biggest cargo operator at the ports of Port of Tallinn. AS Vopak E.O.S. belongs to the Royal Vopak group, the global market leader in the independent storage and handling of liquid oil products, chemicals and gases, Port of Tallinn said. In Estonia Vopak E.O.S. operates three terminals with an aggregate capacity of 951,000 cubic meters. The terminals are situated at Muuga port (Pakterminal), as well as in the nearby industrial area of Iru (Trendgate) and the industrial town Maardu (Termoil), being connected with Muuga port by pipelines.

Vopak E.O.S. handled over 19 million tons of freight last year, which accounted for nearly 52 percent of the total amount handled at Port of Tallinn and for some 75 percent of the total amount of liquid cargoes handled here. The number of ships admitted with cargoes for Vopak was 364 in 2010.

At Muuga port a single area has remained that is suited for building a terminal for liquid cargoes, the so-called Lonessa territory in the western part of the port. For that area a zoning is valid permitting the establishment of a facility for liquid cargoes and a corresponding construction permit issued. The terminal would be laid out on an area of  20 hectares.

BNS – The municipal government of the Estonian capital Tallinn is about to give permission on Wednesday to the operator of the city's industrial parks AS Tallinna Toostuspargid to sell a property in the Tondiraba industrial park to the Norwegian electrical equipment maker Mascot.

It appears from the draft decision of the city government that two offers were submitted for the plot situated at Taevakivi tee 15, the last of the plots in the eastern Tallinn industrial park waiting for a developer.

The bidder, Mascot Holding, has offered to build a plant on the property that would be owned by Mascot's fully owned Estonian branch.

According to Mascot's business plan a production building with a gross area of 6,000 square meters would be built on the plot in stages over a period of two years. The plant would manufacture power supply units that can be used in a wide range of products from toys to medical equipment and would employ a work force of 120.

BNS – According to a plan of the state-owned company Port of Tallinn, a terminal for liquefied petroleum gas (LNG) will be built at the port of Muuga just outside the Estonian capital Tallinn that will mainly handle transit of LPG from Russia and Kazakhstan as well as imports for the Baltic market.

The planned capacity of the terminal could be 300,000 tons of LPG per year in the first stage and up to 800,000 tons per year in the second stage, Port of Tallinn said.

The chairman of the supervisory board of Port of Tallinn, Neinar Seli, said the terminal would enable to use LPG based on the same parameters as natural gas.

"It means that after installing corresponding equipment at boilerhouses it will be possible to switch from expensive fuels or environment-polluting coal and oil shale to more economical and cleaner LPG. This is a substantial step closer to Estonia's energy security," Seli said.

An environmental impact audit has found that no significant increase will be caused in the environmental burden for the terminal area or nearby areas.

The area chosen for the terminal in the eastern part of Muuga port is suitable for safety reasons, as no dwellings or public buildings are situated within its potential maximum danger perimeter, Port of Tallinn said.

ERR - The state is receiving 507 electric cars – for which it plans to establish a pervasive nationwide network to charge the vehicles - in exchange for trading 10 million carbon dioxide credits to Japanese conglomerate Mitsubishi. The i-MiEV make cars, which are to arrive in December, will be given to state social workers. Confirmed on March 3, the deal also allocates funding from Mitsubishi to build 250 electric car charging centers in larger towns and along the main highways by 2013. The express chargers are capable of recharging 80 percent of an empty battery in 30 minutes.

Money from Mitsubishi will also be used to promote private consumption of electric cars, subsidizing the first 500 buyers, who will be required to recharge from renewable sources. The government said the move will be a step toward its goal to overhaul 10 percent of transport sector to rely on renewable energy by 2020.

Read more: http://news.err.ee/Economy/4c2c81b0-37e8-4ea3-9970-498c3c658070

ERR - Estonia was ranked 11th, up seven places since 2009, in A.T. Kearney's Global Services Location Index, which lists the world's 50 best destination countries for outsourcing. The outsourcing activities considered for the ranking include IT services and support, contact centers and back-office support.

The study is an outcome of a weighted combination of relative scores on 43 measurements, which are grouped into three categories: financial attractiveness, people skills and availability, and business environment.

In the freshly published 2011 index, all three Baltic nations are recognized as examples of countries that have climbed in the competitiveness rankings as a direct consequence of the crisis. Latvia has gone up nine places to 13th, and Lithuania seven places to 14th.

In subcategories, Estonia came in fifth overall in education and seventh to ninth in language proficiency, significantly outranking its Baltic neighbors. On the other hand, labor compensation costs were higher in Estonia than in Latvia or Lithuania, whereas tax and regulatory costs were found to be lower.

"The economic downturn has forced companies, especially large multinationals, to review the patterns of providing corporate services. We have seen relocation of production plants internationally for decades, but now the shift has caught up with services. Increasingly, those services that do not need proximity to the end-user are relocated from countries with a high cost base to places with the best cost-to-quality ratio. The patterns of corporate services are changing and becoming ever more influenced by globalization," said Maria Alajõe, board member of Enterprise Estonia, commenting on the report.

Read more: http://news.err.ee/economy/a0559455-99f7-42e2-b2dc-7fceae455e7c

ERR - The three-day Ecobuild fair opening March 1 in London will for the first time feature a number of Estonian companies who hope to impress with environmentally-friendly planning and design ideas.

"The main goal is to find new and beneficial business contacts for Estonian companies," said Allar Korjas, director of the Enterprise Estonia export division. "The other goal is to introduce Estonia and the local companies as competent and innovative-minded partners in the field of construction, thus strengthening the reputation of the Estonian entrepreneurial sector as a whole."

The companies include construction material producers, design development and engineering companies and providers of IT solutions for intelligent buildings.

The Estonian national booth features 11 companies, including  Viking Window AS, Krimelte Tempsi OÜ, Amhold AS, EA Reng AS, and Yoga Intelligent Building.

Read more: http://news.err.ee/economy/c652d3d4-38aa-40bb-a105-9a57b2dac840

ERR - Foreign investor interest in Estonia is growing again - over 100 foreign investment projects are currently being processed by Enterprise Estonia, which is much more than in the two previous years put together.

Enterprise Estonia management board member Maria Alajõe said that only around ten foreign investment projects were being processed in 2008.

The state enterprise fund is even more pleased that to an increasing extent, foreign investors are looking for qualified workforce in Estonia, ETV reported.

"I would say the primary sectors are electronics and mechanical engineering where we clearly possess workforce of a good level," said Alajõe. "One could say we have become an integrated part of the corresponding sectors in the Nordics. IT and business services have also come to life."

Read more: http://news.err.ee/economy/bbb287e1-9e04-4db2-bd36-ac9a5faa5596

BNS – Nordkalk AS is about to invest 8.1 million euros in the reconstruction of two 100-ton lime kilns and related facilities in the Rakke burnt lime producer in Estonia, as a result of which the plant's output will more than double by 2012.

Nordkalk has signed an agreement on the supply of burnt lime with the Latvian metals producer Liepajas Metallurgs for 15 years and in 2012 the output capacity of its Rakke plant is planned to be 100,000 tons compared with 40,000 tons now. The first stage of the reconstruction will be carried out by Skanska EMV.

The manager of Nordkalk, Andres Rammul, said the plan was to renovate the old kilns that have been standing idle so far. "The size of the investment in the project is 8.1 million euros, of which 1.1 million will be spent for the acquisition of dust filters. We will also make an investment at the Liepaja railway terminal so our goods can be received there," Rammul said.

Quicklime products are used in the manufacturing processes of steel, in upgrading processes of sulphide ore, in making paper pulp, and for cleaning drinking and waste water. Nordkalk produces quicklime at five locations in Finland, two in Sweden and one in Estonia and Russia each.

In Estonia the biggest consumer of quicklime produced by Nordkalk is the Kehra pulp and paper mill.

Nordkalk is a member of the Rettig Group of Finland.

BNS − The manufacturer of sealing foams and sealing tapes Krimelte has transferred its unit producing expanding sealing tapes from Denmark to Estonia, said Wolf Group, which unites the domestic and international production and sales divisions of Krimelte.

The unit, Exadan AS, was acquired in 2008.

The factors speaking in favor of moving the factory to Estonia were the favorable tax system, lower fixed costs, and flexibility, Wolf Group CEO Jaan Puusaag said.

"For our Western European clients moving production to Estonia looks like an undertaking of dubious nature. We definitely must walk the line now so they will get it that they aren't losing anything in terms of product quality," Jaan Puusaag said in his remarks to the daily Aripaev.

For clients in Western Europe the Estonian plant is an entirely new partner. "It takes a lot of energy to break prejudices and we need to do it in such manner that we won't lose a single client. You can do whatever you want, but when a salesman comes from Denmark it's an entirely different thing than when he comes from Estonia. In old Europe you're from eastern Europe and you have to be five times better before anyone starts to believe you," he said.

Planning of the shift started about a year ago. "The initial plan was that we'll bring it over last summer, but volumes grew very steeply and we understood that it's not possible to handle the shift without risking losing customers," he said.

"For example in Denmark, the factory worked in one or two shifts, but here we could make it work in three shifts, if necessary. Such an integration of production provides the company with flexibility and stability," Puusaag said.

Also, in Denmark, for instance, a person must not work alone with a piece of equipment in a separate room, there must always be another person present. "It means that when you don't have a very big operation to do, but a simple one, you must nevertheless hire two people," Puusaag said, adding that because of the high tax base hiring a person cost three times more in Denmark than in Estonia.

Another factor speaking for Estonia is summer holidays. "The whole Denmark is on holiday in summer. In Estonia you can arrange these things in such manner that you don't have to close the plant for the whole month of July and half of August," the CEO added.

The company will also save on rental costs as the rental of the plant in Denmark is 25,000 euros a month or 300,000 euros a year. The cost price of material on the other hand is bigger in Estonia.

The sealing tapes plant in Denmark last year had a turnover of three million euros. The Danish plant employed a work force of 12, whereas in Estonia eight people would be hired.