In Estonia, the moral standards when it comes to doing business with Russia are higher than in other Western countries, Kallas says, hence is why the current furor has been accepted more easily in other countries.
Kallas gave a lengthy interview to ERR journalists Mirko Ojakivi and Arp Müller, appearing Tuesday on Vikerraadio’s “Stuudios on peaminister” broadcast, which follows in its entirety.
Mirko Ojakivi: How do you see yourself now. How you have reached the deepest controversy of your years as prime minister so far, and why?
First things first, I must say that I am deeply sorry that a situation like this has arisen. I have always been very clear in my standpoints: As long as this war is ongoing, all business with or in Russia must cease. I still hold to that view. Granted, legal regulations or sanctions are one thing. Sanctions, in case these goods are those that could directly aid the Russian war machine in one way or another. However the second aspect is the “moral compass” which all entrepreneurs need to calibrate for themselves, so that we can all make a concerted effort to pressure Russia into drawing a halt to this war.
So, nothing has changed in that sense. However, my husband really owned a minority stake in a logistics company (Stark Logistics – ed.), but they closed their operations in Russia a month after the war started, precisely for the reason that this is morally wrong. What they did next was to help wind up their majority owner’s factory plant there, in a financial sense, and in this regard, his position was that, since one Estonian company was providing a service to another Estonian company, it was not supporting the Russian war machine with a single euro, ruble or dollar, and until these questions arose, nothing was seen as morally wrong in that.
Now, he has been taking a very clear stance, by selling off his stake in a company he has built up over the years, and he is no longer associated with it in any way.
Arp Müller: All your views and your statements that you referenced just now – “everything in war is very black and white and you clearly have to choose a side,” or “we have to take economic weapons from Russia to prevent the continuation of the war” and, as you just said, “entrepreneurs also have to be moral compass in place.” All the time you have been making these statements in public, the company, with the participation of your husband Arvo Hallik, where your husband also worked as a finance manager, continued to transport, or helped to transport to Russia, packaging steel and other materials from which aerosol cans were assembled in Russia, items which today are also a sanctioned product (the assembled cans are under sanction, the separate components are not – ed.), while these materials were taken there to a value of nearly €30 million. Was your spouse not listening to your statements or not grasping their message?
I cannot be held responsible for the actions of this company. I don’t know about how things are with your family, but my husband doesn’t listen to me in any case, that is very clear to all now. But all joking aside, we have actually discussed it. Their position was that which was the more correct – to abandon all this property in Russia, where it would certainly not benefit Ukraine, or to try to retrieve it. Their understanding was that they had internal company ground rules against even buying fuel from Russia, even though fuel is so much cheaper in Russia. In their view, they did everything right, and helped the Estonian company wind down its operations there.
I do not know all the details of this activity. I didn’t know them before, and I really didn’t get involved in this business in any way, I haven’t been aware of the activities of my husband’s business partner for a lengthy period of time, nor could answer that much about this.
There have been accusations made that before the war I visited a factory in Estonia, and indeed, the prime minister does have to visit a lot of firms. Today I just came here from Paldiski, where there was a conference involving some large companies, and where the business-people wanted a photo taken. There arises a question of who will you be photographed with again, and whether you can be blamed for all this right away.
Thus, am I automatically responsible for all their actions?
I’m very sorry that such a situation has arisen, and everything can be taken advantage of here, but I really would like to do all I can to lay these doubts to rest. I have not altered my stance. In my opinion, everything in war time is black and white. I read what the Minister of Economic Affairs and Information Technology Tiit Riisalo (Eesti 200) has also said: That in fact, many entrepreneurs have been resigned to the fact that it is not at all that easy to wind up operations in Russia. You have a responsibility to the owners, and to your foreign partners.
When we see that our moral standards are much higher, then in most countries it is clear – you must not violate the sanctions, this is illegal, there are penalties that apply. But everything else that is not under [sanctions] is not as objectionable there, as is the case in Estonia. We have striven to urge everyone abroad to make this, however, as reprehensible as it is in Estonia.
MO: You said at yesterday’s (Monday, August 28 – ed.) press conference, and you’ve actually stressed it here on the show, that you’re sorry that this situation arose, and you have given an apology. At that same press conference yesterday, you said that you actually want the opposition to initiate a vote of no confidence in you, so that you yourself can understand what it is you are guilty of. But what, then, were you apologizing for, if a moment later you then said you didn’t understand what you were being accused of?
I apologized that this situation has arisen whatsoever. I apologize for the fact that we are all in such an uncomfortable situation, plus it is as if everything I have done so far, or what Estonia has done so far, what we have done, and what we are still doing, has been called into doubt.
AM: And what is your role in that, how would you characterize it?
That’s a great question in that I’ve been very clear in my own views, but can’t take responsibility for others, can’t take responsibility for others’ business. However, it is clear that as prime minister I bear a responsibility, this is certainly a scandal which is linked to me, and for that, I apologize.
MO: At what point did you find out that the trucks belonging to your husband’s company transported material, metals, to Russia, thus providing work and turnover to a company operating in Russia? After all, this company also pays taxes into the Russian state budget, thus, albeit indirectly, it supports Putin’s war machine. Physically, materials were transported from Estonia over the border to Russia, and thanks to this, the Russian economy was able to develop just that little bit more. At what point did you find out about this?
Once again, I cannot state whether what you’re saying is true or not, as I haven’t checked what they have or haven’t been doing. This is an Estonian company, one which has been helped by another Estonian company. As to when I found out that was when the questions started to come, last Monday.
I then asked my husband, and he said no, we really have already halted all Russian activity, we did this in the first quarter of 2022, that there is no problem, I will rectify things, and I will answer these questions. But at the same time they (ie. Stark Logistics – ed.) also had the auditors in; so I understand that journalists expected quick answers, but put simply, companies also have their own activities. In this regard, I really had hoped that they would give clear answers, and that this issue would be dropped, because personally, I, as the Prime Minister, cannot be held responsible for the actions of business enterprises, or to go and give an account on their behalf, if I am in fact not responsible for this.
MO: Our colleague at ERR, Urmet Kook, related, in the latest episode of [Vikerraadio show] “Rahva teenrid,” how these questions had in fact been sent out to your husband on Friday night (August 18 – ed.). You say you received these questions at lunchtime on the following Monday. Did your spouse not inform you in the meantime that a media request like this had reached him.
You know, it’s funny; at that same time we were together with the families of the Prime Ministers of Latvia and Lithuania in Soomaa, Viljandi County, and I didn’t even have a phone handy. Why do I say that was funny? Well, the Latvian Prime Minister’s wife raised the question of whether partners get attacked in our country. She said that they had had a scandal there where she was attacked, and the Prime Minister of Latvia (Krišjanis Karinš – ed.) in turn talked about how difficult that had been. We replied that there has been no such thing happen in Estonia. And really we were there Friday to Saturday; Sunday was a free day (Restoration of Independence Day – ed.).
Ultimately, my husband, who is not a public figure and is not accustomed to having to deal with the media in this way, regarded it as an inquiry which the company manager (Kristjan Kraag – ed.) was dealing with and did not consider it necessary to inform me about it, because he thought that they already had clear answers – they are not responsible for feeding the Russian war machine with any euro, dollar or ruble.
MO: But was this not a mistake, a false assumption to make?
Now, it can be said that it was the wrong assumption to make. Using one’s political sense, one could say that from this point, it is viable to present these things in such a way that they do look very bad. He has explained to me that they helped an Estonian company (Metaprint – ed.), which was also their own majority owner. If the majority owner also has a transport company, it would be strange for him or her then to order logistics from somewhere else. But this is very much with the benefit of hindsight. It certainly, however, does not change the fact that I have not been involved in this business, and I have no wish to be involved in it in the future.
MO: Yesterday, photos were disseminated in the media of you visiting Metaprint, where the locations of the factories were written on a slide presentation, one of them being St. Petersburg, in Russia. In recent days, you have repeatedly tried to give the impression that if a presentation like this was made today in Metaprint, you would join the dots together better, and the assessment would be unanimous. But if we think about the context that prevailed at the end of January 2022; actually, on January 19, a week before visiting Metaprint, you made an extraordinary political statement about the security situation in front of the Riigikogu. Eero Epner recounted in Eesti Ekspress that the Estonian government actually was aware that a full-scale war in Ukraine was coming, in December 2021. Aren’t you just trying to portray yourself in a more appropriate light right now?
Let’s wind back to January 2022. When I presented that security policy statement in front of the Riigikogu chamber, the opposition (at the time consisting of Isamaa, EKRE and SDE – ed.) ridiculed it, as did the media.
MO: But you were aware of it?
No one took what I said seriously. Since there was an energy crisis going on in particular, soaring energy prices, I was even accused of inventing this saga, just to divert attention away from that. What we knew in January 2022 and why we made this security policy statement – we saw what Russia doing in making maneuvers towards an attack on Ukraine. We didn’t know if that would really go ahead. But we knew that we couldn’t go back there and say that we should have made these decisions three weeks before the war actually started.
In the course of the meeting with the entrepreneurs (at Metaprint – ed.), we talked about the two things that were relevant at the time. This really seems like an eternity ago – Covid; if you look at the pictures, we are even wearing face coverings. While the other big issue was the energy crisis. At that point in time, the Estonian government was criticized for not supporting companies experiencing high energy prices, especially industrial firms.
At that moment there were also other concerns on the table. To put these images into the present-day context, knowing what we know today, it really is possible to portray anything as happening. But to be honest, you did not take this security political situation seriously at the time, nor did the opposition, for a long time.
MO: We?
The media. That time when I was in the “Aktuaalne kaamera” studio, live, and the journalist averred that “you have invented this security situation to divert attention away from the energy crisis and the fact that the government does not want to support industrial companies.” I want to note this: To say that a month before the war began, we should have known that the war would one, break out, two, how it would progress, and three, how our business-people would act if the war lasted that long – well this seems to me far too high of a bar, at least for me; I could not have foreseen things.
MO: As for this Eero Epner story, Epner quotes Foreign Ministry Secretary General Jonatan Vseviov as saying that, in retrospect, we had the picture in front of us.
We had the picture in front of us, hence why I made a security policy statement – I do not dispute that. But going on from that point; who are the Estonian companies which operate in Russia, how should they act in this scenario. We did have other concerns, too. We were concerned about making purchases of ammunition as soon as possible, so that we could go into the procurement process before the war started, and everyone did so. Those were the decisions we made at that time.
MO: The question all reduces down to the fact that when you visited Metapring – I understand that you certainly knew that the Metaprint entrepreneurs were your husband’s business partners – and when you saw on screen that they operate a factory in Russia, but you sense that in the coming weeks, months the [security] situation may escalate, then a simple the human feeling would be that some kind of lights went on. But as I understand it, this Powerpoint presentation went blank.
Would that I were as smart as you are. But I have to visit hundreds of companies, who all show me hundreds of Powerpoint presentations about their activities, slides which include maps, with little dots on them, where there are companies. Again I repeat – when communicating with entrepreneurs at that moment, the themes were completely different – the high energy prices and the Covid crisis.
AM: Naturally, opposition politicians have plenty of questions; we also mediate some of these here on the show. The Isamaa chair and former foreign minister Urmas Reinsalu reminded the media that his party submitted a proposal to the government last spring, during the previous administration to completely halt freight transport with Russia and to cooperate with the other Baltic states in this regard, as Reinsalu had personally been asked to do so by the Prime Minister of Ukraine. Reinsalu wrote that: “At that time the prime minister of Estonia and her political party did not support this proposal.” Again, to take down these questions: Why did you not support this proposal if it were in Ukraine’s interest? The question immediately arises, perhaps the reason was that your husband was involved in transporting material goods to Russia?
First of all, once again, I had no idea that he was helping this Estonian company to wind up its business in Russia.
Second, the foreign minister had come up with various proposals, I don’t remember specifically, but all these proposals – there was also another aspect, and the second aspect was that it makes sense for us to do these things only if we do them in concert with the other Baltic states and with Finland. It is for this reason that if we close our borders, others will remain open, then these goods shipments etc. would simply move via Finland, Latvia and Lithuania, who would have kept their borders open, so in this sense it makes sense to do it only together.
We had an extremely strong consensus with Urmas Reinsalu when he was in the government. I don’t recall ever having an argument in which we were on different sides on issues like the war or sanctions. It just wasn’t the case. The fact that Urmas Reinsalu is attempting to portray things this way now, in my opinion, is simply unsavory of him.
MO: Well, Estonia unilaterally – then admittedly, later in cooperation with the other Baltic states – imposed sanctions on the export of oil and oil products from Belarus, via our ports. How come we didn’t need this international cooperation on this matter?
We need international cooperation on all matters. The difference with just a land border is that only three countries have a land border (with Russia, ie. Estonia, Finland and Latvia, although Lithuania and Poland have a border with Russia via the Kalinigrad exclave – ed.).Once Belarus is added into the mix, then Poland and Lithuania are involved too. Therefore, this has been necessary.
Oil on the other hand a completely separate issue, precisely for the reason that we have pushed for a complete oil embargo since the start. This oil, and where it goes to anyway, in the end. But I don’t have those materials with me now on those discussions, what the thinking was at that juncture.
Again I repeat – all the proposals from the Ministry of Foreign Affairs, well I don’t remember a single time that anything was left unsupported. I don’t remember a single time that we had substantive disputes with Urmas Reinsalu regarding support for Ukraine, the [international] tribunal issue, sanctions etc. We have been of one mind, all along.
AM: [ERR] Journalist Marju Himma stated on the weekend radio show “Olukorrast riigis,” that: “The Internal Security Service (ISS) has said that they do not see anything illegal in this activity. But apparently the ISS had also informed the prime minister about this type of a risk materializing, and now the question is why this risk was ignored. “Why did this risk actually materialize?” – this was Marju Himma’s question, and can you clarify? Can you tell me if the state organs warned you of the possibility of such a risk, did they fail to act, and did the ISS fail to act?
Again I repeat, we have to distinguish between two different things, one of these is legal norms and the other concerns moral norms. Legal norms include sanctions; violating these is prescribed for in the law, this simply must not be done. We have moral standards in Estonia which are higher than they are in other countries. And the moral norms are precisely this condemnation we have been hearing, that it is not ethically right, when this Russian war is going on against its neighbor, to have anything to do with it there, at all. But, there is no sanction for moral norms.
MO: What about potential compromise?
And what about this compromise?
MO: You would not be in this situation today if the ISS had been able to bring you this information early on enough, and you would probably have been able to ask at home about what was going on?
The ISS has not said anything like that to me or given me any form of indication. Specifically, because they say that nothing illegal has taken place. I have been given top level NATO security clearance, which means full disclosure, in every regards. When a new government comes together, all these permits are updated; it counts for nothing that this clearance was set up when I became prime minister.
MO: Did you also go through this process in the spring (when the current Reform-SDE-Eesti 200 coalition entered office – ed.)?
The clearance update, yes.
MO: You went to the ISS to renew your state secrets clearance and you were not informed about your husband’s Russia-related transactions?
I renewed my clearance and I had not been informed because it is not related to Russia, but was related to him aiding an Estonian company to disengage from Russia.
MO: This was the ISS’ position?
The ISS said nothing about it as this was not a red flag, in any way. It is specifically that this assessment has not been made, that something wrong has happened. So I simply re-obtained all the clearance. The government entered office in April, and we’re in August now.
AM: Now let’s look at things from the point of view of business, and the effects on entrepreneurship. Many Estonian companies have ceased operations in Russia and have therefore incurred millions of euros in losses. Even Õhtuleht has, for example, brought up the Estonian fish concern, operating under the Kaluri brand, which gave up its plant in Russia.
If the owners and managers of such companies now read in the media that the prime minister’s husband not only continued to transport items to Russia but also earned one-and-a-half million euros in the process, what conclusions do you advise the heads of these companies to draw now?
Once again, my husband stopped working in Russia a month after the start of the war. Whereas before that time they had a small volume of Russian shipments, in the first quarter of 2022 they halted these shipments. What they did do was to help an Estonian company wind up its operations there, and this company was also their majority owner.
Again, I personally hold to the view that it is morally wrong to engage in activities in Russia while this war continues, and this view has not changed one iota.
AM: Speaking of winding things up: Metaprint’s revenue in Russia in 2022 actually rose on year, rather than fell
Once again, I can’t speak for Metaprint. I can tell you what my husband has told me, how they understood what they are doing, that they don’t leave even a single euro to feed the Russian war machine, and they come to the aid of an Estonian company.
You can ask this entrepreneur how the Estonian company wraps up its activities there, how it carries that out.
MO: However, the customs declarations reveal that nothing has been brought back from Russia; only items have been transported there. Moreover, last Friday, a photo emerged of a truck bearing the brand of the same company that likely still belongs to your husband, traveling to the border with Russia. They have refused to answer the question of what is contained in that truck.
We have agreed sanctions and those goods subject to sanctions are checked by customs officers at the border, so they cannot move across the border.
My husband made the decision on Friday to essentially give away his share, and so he did. So he is no longer associated with this.
And to those businesses that have wound up their Russia activities, I want to say a big thank you: This has taken a lot of effort, and it’s actually resulted in losses, so in some ways you are just as much a victim of war as the businesses that have suffered in connection with Ukraine.
This is a separate matter, though. Many entrepreneurs have also informed me about how difficult it is for them to actually wind up their activities there, but I do not justify this in any way. I absolutely do not justify it, and I really say a big thank you to those who have done so, and a thank you to those who will do so in the near future.
MO: But by the way, there are also other opinions out there. For example, the father of your coalition partner Jevgeni Ossinovski – businessman Oleg Ossinovski – said in an interview he gave to Postimees yesterday that: ‘Every euro taken from Russia to Estonia weakens the bloody aggressor, that is, the more entrepreneurs earn in Russia and then bring to Estonia, the weaker, as I understand it, the Russian economy will be.’ If I were to continue in an ironic tone, one could ask whether Estonian companies should instead start sending more money to Russia, to make money, in order to weaken Putin. But I will not go there; I will continue in a more serious mode. Will the continuation of those Estonian companies still engaged in activities in Russia be morally and ethically normalized, as a result of the current scandal?
I do not believe so. I’ll state it again, Friday was actually very a difficult day for my husband; he’s built this company up over the years, and he basically gave away any stake in this company at any price, to demonstrated through his actions that he accepts responsibility.
To say that this has somehow normalized things is, in my opinion, going too far. On the contrary, it has brought attention to the fact that this public resentment exists towards those businesses who are still operating there; on the contrary, in my opinion, it makes it very difficult to continue operating in Russia.
MO: Delfi pointed out yesterday that, in spite of your calls, according to customs and excise statistics, the aggressor country, Russia, has emerged as the main destination country for Estonian trade, as concerns countries outside the EU. How do you account for the fact that many Estonian businesses and business-people have not heeded your injunctions and have acted in the same way as your husband has, in continuing to transport these goods there?
Once again, my husband helped out another Estonian company, and I can’t speak for that company. What they said, how they will wind up their activities…
MO: Whence do you get the idea that this is all about winding up activities, when [Metaprint and Stark Logistics majority owner] Mr. [Martti] Lemendik also gave an interview to ERR yesterday in which he essentially, if you read it, doesn’t get the impression that anything will be ceased there?
What Metaprint and Mr. Lemendik do can be answered by Metaprint and Mr. Lemendik. How something is carried out or not carried, well, I really can’t say. That’s what my husband’s knowledge concerned; what they do, how they help to bring these movables or this money back [from Russia].
Now to address your question. First off, we have to distinguish between what the origin of our entrepreneurs is, and what the other countries re-exports through Estonia are. Exports from Estonia to the Russian Federation, and exports of Estonian origin to the Russian Federation, stand at €345 million versus €64.6 million, that is, the exports of other EU member states, which, so to speak, come through us, are greater than the exports to Russia of all Estonian companies of Estonian origin.
In other words, the entire exports of Estonian origin in 2022 totaled €198 million. Exports from Estonia (including re-exports – ed.) to the Russian Federation stood at €750 million. The second issue is that if you examine these total numbers, the volume of freight to Russia has not risen, but unfortunately it has not been falling either. It is specifically the volume of transport by carriers in European countries that has risen, that is, not the volume of Estonian carriers, but the volume of carriers from other European countries. And this is largely related to the fact that, since goods are no longer being transported by freight carriers from the Russian Federation, these services are taken via Estonia.
I also want to say here that if we look at Estonia’s exports as a separate entity, this downward trend is noticeable, though of course the numbers cannot be over-dramatized. Russia as a destination constitutes only 4 percent of our exports, while on the import side, it does not fit into the top 10 whatsoever, it stands at 3 percent.
AM: And what do you think today about this proposal from Reinsalu at the time, to have completely halted all trade with Russia across the Estonian border, so that neither Lemendik, nor anyone else, could physically send any freight across the border any more?
If Finland and the Baltic countries do not come on board, then all these shipments will still simply go via the borders of Finland, Latvia and Lithuania instead.
MO: But at least that way our collective conscience would be unsullied
As a small country, it is not reasonable for Estonia to impose restrictions on its own, though it is wholly reasonable to do so together with the rest of Europe.
AM: Are you currently working together to decide with the rest of Europe that trade with Russia will really be reduced to nothing?
Yes, that is what I’ve been saying all along, that the easiest thing would be if all borders and trade were to be shut off. That way it would be easier for our customs officials; they wouldn’t have to check exactly which goods are going out of the country and where to.
For instance, a major problem is that many people have said that they will travel via Russia in transit, but whether they reach the destination country, we really don’t know.
The simplest thing would no movement, but this has not been possible hitherto, since other countries have not come on board – precisely for the reason that they themselves have businesses who likely want to retrieve things from Russia, or to move them in order to wind up their activities; I really couldn’t say. However, yes, it is not reasonable for us as a small country to do this in isolation.
MO: Both on today’s show and, actually, yesterday, you stressed that your husband has sold, or is selling, his stake in Stark Logistics for a peppercorn sum. But if he didn’t do anything wrong, in his own opinion, and in fact there has been no public demand for him to take such a step, why did he sell the stake anyway?
I have also said that they want my blood, not his. His stance was that he has inadvertently pressurized me with things that I was not responsible for, and to draw a line under it, he is selling off that stake. He would then have no connection whatsoever with these transports, even as this was actually due to end in September – but he has drawn that line under things.
AM: But why has he put you under so much pressure, why do you have to explain all this in front of cameras and microphones, all the time? Since last Wednesday, when [ERR journalist] Madis Hindre cornered you there at the memorial to the victims of communism, so you probably also got upset with Madis Hindre and asked why are you asking me about this, it’s unfair, go ask Hallik. Didn’t you know at that moment that Arvo Hallik would decline to appear in front of cameras and microphones, so we can’t ask him?
You see, my husband is not a public figure.
AM: So why did you suggest Hindre ask him about it?
You know, regarding this last Wednesday; I think around 1 p.m. the news broke. I arrived a little later, maybe at 3 p.m., at the memorial service at the Memorial for the Victims of Communism (in the Maarjamäe district of Tallinn – ed.), something was very moving, where a long rendition of “Ta lendas mesipuu poole” was performed a cappella, which always brings a tear to the eye. Then I get asked questions like that, in such an emotional situation. I understand, journalists in this context, you have to do your job, but I just didn’t have the answers to these… very difficult questions, right there and then on the spot. I’ve never hidden myself away from journalists; I just simply wasn’t keyed up with the answers at that time and place.
As to the question, my husband is not a public figure, whereas I, whom you deal with on a daily basis, know that this is a very difficult thing, because you are, let us say, very tough and very human.
MO: Are you talking about myself and Arp specifically, or journalists in general?
I mean journalists in general; this is very intimidating, especially in a situation where every word you utter gets seized upon. If you don’t know how this worlk, aren’t used to every well-meant joke being taken out of context as if it’s an actual statement and so on, then it works out easier to respond in writing. So there’s not such a hope that I will be that open and talk to all and sundry, only to place myself in a delicate situation.
Just for interest’s sake, I also looked at, for example, the British Prime Minister [Rishi Sunak], whose wife has also had a stake (in an IT company with in Russia – ed.), and he has similarly taken a hit in the sense that his wife is not a public figure and she does not need to interact with the media in that way. There is one more small catch, too. He (Kallas is referring to Hallik here – ed.) is a very private person, and once you grant these interviews, the next moment you become a public figure, and you can no longer turn them down.
AM: But to those people who ask questions in public or via social media, as if it is undignified for a man to use his wife, as it were, by pushing her forward as a shield, how do you answer them?
He’s not pushing his wife forward, I just happen to be the prime minister. On the contrary, I might say that no one would care what my husband were doing, if he were not my husband. After all, no one is attacking the 309 other firms that are currently transporting goods across the Russian border…
MO: The fact remains that their spouses are not the prime minister, though.
This is exactly the point I wanted to make; that in fact you could say the opposite, that he is under attack precisely because he is my husband, not because he is Arvo Hallik.
AM: However, your husband has a stake in another company belonging to the same business group, Stark Warehousing, while he has said that he is not prepared to give that up. His share is then 30 percent, and he is also a member of the board there. In response to questions from EPL, he has also stated that, among other things, he used funds borrowed from you to set up Stark Warehousing. Can you confirm that this warehouse company Stark Warehousing is in no way used to store, for example, Metaprint’s goods destined for Russia, so that no new charges will arise there?
First things first, I would like to clarify what you say about them belonging to the same business group. You see, if you have a limited company, and I have another limited company, and we both have shares in Tallink, for example, it does not followed that we are involved in the same business group. In this sense, it is a separate company, which deals with warehousing solutions.
A warehouse cannot be moved to anywhere in Russia. The owner of the goods is responsible for where the goods go from a warehouse, but a warehouse located on Estonian soil cannot be held responsible for that. Just as the ports are not responsible for all the goods that pass through them, and so on. In short, my husband is an entrepreneur, and the decision he made on Friday was painful, extremely painful, for him, and I really request that he still be able to continue his business in the warehouse sector, which is on Estonian soil and which should not be the subject of injunctions today.
MO: Madam Prime Minister, you understand very well that considering what has happened surrounding your family in the last week, the question arises whether you and your husband have dismantled his businesses and whether your conscience is now satisfied, and you can be sure that there will be no new ethical and moral problems. Even saying the same for Metaprint’s metals, which are transported to Russia, where something is then produced from them, inside Russia, that is then resold – that this is not stored in the warehouse, and so on. Have you and your husband finally sorted out these things, in detail?
I am not responsible for that. Your fertile imagination just reaches very, very far. In this way, all those companies that are still operating in Russia can be taken, and everyone who provides services to them.
As a country, we cannot act as nannies; we can give a moral assessment to such an action, which in this case has been done here the once and, once again, and I am still ready to repeat this in saying that all business activities in Russia must cease. And of course, each of us can think about how we can contribute to this, so that such as situation does not happen.
AM: Martin Laine revealed in Delfi that Metaprint’s business partners in Russia included Tyumenskie Aerozol, a firm which has previously supplied the Russian Ministry of Internal Affairs with tear gas. I don’t know if it still supplies that, as during the war this information has now become classified. How bad does it look to you that, figuratively speaking, a truck belonging to your husband’s company transported metal parts to Russia which ended up containing tear gas used by the Russian Ministry of Internal Affairs?
You’re just casting aspersions round here, aren’t you. You don’t know that, I don’t know that, and I won’t know that tomorrow, and I cannot be responsible for the actions of my husband’s business partners’ own business partners. I just can’t take responsibility for that, and neither can my husband. So somewhere, well, there should also be a dividing line of normalcy.
I think it is great that the media carries out research like this and examines everything in detail. But no kind of business activity has anything to do with me.
AM: Let’s talk about this loan theme, if we can. Under what circumstances did you lend €350,000 to your husband’s company, then later another €20,000. Why was this, wouldn’t it be easier to take a loan from the bank?
Have you ever tried taking a loan from the bank?
AM: More specifically, the bank presents all kinds of requirements. There would be, as it were, a transparency check, likely because the shipments took place in Russia…
Listen, listen, listen, this is going way too far. My husband has a financial holding company, Novaria Consult, which deals with various investments and has various holdings. I am not a shareholder of it, he is the sole owner.
He needed some capital, and I had that capital, and I was able to lend him that capital. Since it’s a financial holding company, all the annual reports are public, and you can see where it has all gone. As of now, I have received it back, in various installments.
I’ve declared the interest on that loan on my tax return, I’ve paid income tax on what I’ve earned from it, I’ve been completely open and transparent, completely public about everything I’ve done. In that sense, I have nothing to hide here.
AM: How did the loan take place, by transfer, or in cash?
First of all, I don’t have sums of cash of that amount lying around. Of course, by transfer, and, as I have declared once again, the correct contracts have been made, I received interest, and I have also paid taxes.
AM: We have one question from a listener as well. Just before the start of the show, a listener asked us to ask the prime minister where he got a sum of money of that size from in the first place. Do you want to answer that listener, where did you get such a sum, of €350,000?
I have been working since I was 18 years old (Kallas is now 46 – ed.). I have worked in law firms, I worked myself up from the start to partner, I was a partner with two law firms. Since 2011, all my income has been made public and can be viewed via the declaration of economic interests.
If you would like, you can take a look at the first one and see how much my income was when I was a lawyer. But I have nothing to hide, and once again I have top secret NATO clearance – and I’ve been cleared; all my income – I’ve paid taxes on that.
MO: Today’s edition of Postimees has reproduced a photo of your and your husband meeting last week in the Kaerajaan restaurant on Raekoja plats in the Old Town, with one Helena Roots, who, according to Postimees, works for International Metal Platvorm AG, a precious metals trading platform that offers anonymous transactions. She has previously worked in banking as well, which can be related to Russian capital. These are Postimees claims; the Postimees journalist, Margus Hanno Murakas, raised the question of whether this could be used as a platform for buyers and sellers who want to circumvent sanctions against Russia. Can you talk about why the Prime Minister met someone who works for a company like that?
I had no idea that she is working in a company like that, precisely because she is my husband’s former classmate, she lives in Switzerland and was here on vacation. He is an extremely nice person, and that was the last day we got to meet her. We totally did not talk work. She was there with her daughter, who is attending university now, and we talked about all the things that we hadn’t been able to in a long time. Some very personal topics. Honestly, I really don’t know.
Today (Tuesday – ed.) I joked there in Paldiski that I would get a picture with someone there, right on the spot, and maybe they operate in Russia, I don’t know – it is possible to take a picture and make a connection. Really, I have nothing to hide, I have not acted on behalf of Russia in any way, neither has my husband, and I am ready to answer all questions, but as for who I end up in a photo with, how can I be responsible for what they do? Well, I can’t, and nor can anyone else.
AM: In the course of this controversy, which has come to be referred to as the Russian logistics scandal involving the prime minister’s wife, the question gets posed how, and whether, it might affect Estonia’s international standing and, above all, our influence in the EU, when in the discussions we have been the ones who have called for greater support for Ukraine, and we demand that we shouldn’t do any more business Russia, shouldn’t exchange more goods etc. There are on the other hand several countries and leaders in the EU who seem to think it is perfectly fine to continue trade relations with Russia. Viktor Orban of Hungary is one; there are others as well, but Estonia has so far played the role of persuading them that they too should do more to end trade relations with Russia. How might what has now come out regarding your husband’s business activities impact on this very moral baseline?
Estonia continues to be a leader in tapping everyone’s consciences on this, Estonia continues to be a leader in all these topics. The feedback I have received from other European leaders is more of a “hang in there, we need you,” variety, and this is all certainly more acceptable, at least more easily accepted, than in Estonia, for the very reason that our moral standards are simply that much higher than those of other countries.
In other countries, a clear violation of sanctions is seen as a very bad thing, something which must be punished. Anything else that is beyond the scope of sanctions is beyond the scope of sanctions for a reason, so you can only make moral judgments about it and urge businesses not to do that. So nothing has changed there, nothing has changed in my views and it will not change in the future.
AM: President Alar Karis also made a statement yesterday in which he said: “The subsequent steps of the head of government show how serious she considers the problem that has arisen, and what she thinks are the right solution for the Estonian state.” How serious do you think the situation is, and what is that right solution?
Well, the situation is undoubtedly a serious one, and I hope that the Riigikogu, which has given the prime minister the mandate to form a government and lead it, can give its assessment. In other words, the members of the opposition have said that they will put together a motion of no confidence. If a vote of no confidence goes ahead, then one can defend oneself before the Riigikogu, and MPs can express their position through a vote.
MO: But we know how this vote of confidence will go: Neither Eesti 200 nor the will Social Democrats tend vote against you, but as you yourself have said: “I don’t plan to resign, I have stood and will continue to stand as prime minister for the freedom of Ukraine and of Estonia.” I have a question here: Wouldn’t [leading Reform Party members] Hanno Pevkur, Kristen Michal, Urmas Paet or Liina Kersna stand for the freedom of Ukraine for Estonia, as prime minister, too?
They certainly would, and this is a very fine demonstration of the fact that we have a lot of good people who could carry out the role of prime minister to a tee, so I have absolutely no doubts about any of them. Simply that if the question is whether I will continue as prime minister, then as things are, I will continue. We have talked with our coalition partners, I have talked with my party-mates, and no one sees any reason why I should be replaced, at all.
AM: Could your decision not to resign change in the coming weeks due to any further extenuating circumstances? Have you made the continuation contingent on, for example, the impact of the ongoing controversy on the Reform Party’s rating?
This will surely take its toll on the rating, and there is no doubt in this regard that is it a good thing that there has been a scandal like this, well definitely not. That much is abundantly clear.
What I am saying is that with all such incidents, life shows us that we don’t know how things will turn out in the end. One outcome is that my conscience is clear, I know what I have done, what I have not done, and I would venture to look everyone in the eye in this regard. But politically, your seat can change each and every day, so I will take things one day at a time. I certainly cannot say that I will never resign, I certainly cannot say that, but at the moment, I will continue as prime minister.
AM: That was it, [Center Party MP and former Reform member] Andrei Korobeinik also said as much to Sunday’s “Aktuaalne kaamera,” that sooner or later, Kaja Kallas will still step down; Mikk Salu writes in today’s Postimees that you allegedly gave a clear signal to the leading members of the party a long time ago that at the next Riigikogu elections (in 2027 – ed.), you will no longer be the leader of the party. But who do you see as the next Reform Party chair; would your preferences be for Kristen Michal, Hanno Pevkur, Urmas Paet, Liina Kersna, or someone else?
Rigor mortis has not yet set into my dead body, as it were.
MO: But Korobeinik said that you would resign, sooner or later.
Well, maybe Korobeinik is very, very clued up then. Incidentally, Andrei sent me a highly supportive message, which, to be honest, I rather interpreted as being one of “hang in there.”
MO: Incidentally, do you yourself plan to take part in the search for the next Reform Party leader, or as we have also seen in the history of the Reform Party, there has been one person who says that he does not think that would reasonable.
You know, I have so many worries on my plate right now; we are trying to put together a state budget, one where we need to find savings, and we need to put the whole package together. We have the worries about Ukraine and what Russia is doing, and we have concerns about security, so much so that really, this is not even in my top 10 list of concerns right now.
MO: Are you planning to run in the European Parliamentary elections in June 2024 (Kallas is a former MEP – ed.)?
I haven’t thought about that, but I certainly won’t do so for as long as I was prime minister.
AM: If you have read the pages of Politico in recent years, at times when there has been speculation about vacancies for high-level positions, your name has been mentioned. What is your assessment of whether the current scandal will see your name struck off from these articles in the future?
It all hinges on how this scandal turns out in the end. I can’t say, though I have to say this about all these lists, that it is actually a recognition of the entire country of Estonia, that we are all equally considered there and evaluated as a candidate of substance. In any case, I think that this is a recognition which everyone who has contributed to this work should be thanked for.
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Source:
‘Stuudios on peaminister,’ interviewers Mirko Ojakivi and Arp Müller.