Speaking to ETV news show "Aktuaalne kaamera" (AK) Tuesday, the minister said: "We must not forget that we have also agreed that we will direct at least €320 million in EU funding for business development to rural areas in the next few years, and this will have a significantly greater net positive effect."

"We have agreed on €320 million, but in fact we are talking about significantly larger amounts which can go to rural areas. In this sense, this is standard procedure and this time this government is simply paying more attention to rural areas as well," he went on.

While the Social Democrats (SDE) did not quite get the €1,200 per month minimum wage they had hoped for slotted into the coalition deal signed last month with Reform and Eesti 200, the party was not wholly disappointed with the results either.

Läänemets said the principle of getting a minimum wage rise was most important, regardless of whether the figure was derived from 50 percent of the mean monthly wage – which the new level will be based on – or on 60 percent of the median monthly wage, as SDE had hoped.

"This affects almost 100,000 people, while if we're talking about an annual salary increase being 13 or 16 percent, I think that is a pretty decent salary rise all round," he went on.

Läänemets claimed that had his party not been in office, the minimum wage hike would have been smaller, and arrived later.

Following a tripartite agreement between trade unions, employers and the government announced Tuesday, the minimum wage will rise to 50 percent of the mean monthly wage by 2027, which would put it at around €1,100 per month gross, by that time.

The move is also needed in order to head off tax hikes the coalition has also announced leading to more people havnig to live on state benefits, Läänemets said.

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