Estonia has the potential to build up a defense industry, producing smart systems that would benefit both the economy and the country's defense capabilities, said Bolt founder and CEO Markus Villig on ETV show "Esimene stuudio."
Villig believes there are several reasons why Estonia has the potential to develop a defense industry.
"If we look at the last two years, especially in Europe, there has been a massive increase in defense investment from all countries, with tens of billions of euros in new funding being put in," Villig said.
"And the other thing that has changed is that people are no longer necessarily buying 'dumb' systems that are purely mechanical, they are buying smart systems, autonomous systems, and Estonia has really strong potential here. For 20 years we have been building a world-class digital state and digital companies, and I think we can use this competence in the defense sector. In fact, I see this as a very good opportunity for Estonia to build a new sector that would be good for our economy and that would also be good for our defensive capabilities," he added.
According to Villig, Estonia should not let this opportunity pass it by.
"I am talking about this because I am a patriot of Estonia. I want Estonia to be alive and prosperous in 100 years. I just see that this is an opportunity now, that would otherwise pass us by. I think the government should consider putting more money into Estonia's defense and allocating some of it to getting our defense technology sector up and running," he said.
Villig said he sees a specific opportunity when it comes to the production of drones or other software solutions.
Taxes should be raised in the long term, but not in the current situation
Regarding the debate over the state budget debate and tax increases, Villig said that in the long run, raising taxes is a necessity for the country. However, in times of recession it is better to borrow and invest.
"If we are talking in the short term, in a situation where Estonia has seen in the worst recession in the European Union over the last two years, I'm more a fan of the counter-cyclical economic philosophy and so, I think that right now the state should instead invest and borrow, especially when that is possible, and not burden society with taxes," he said.
According to Villig, in order to achieve economic success, the right decisions have to be taken at the right time.
"Estonia has been on a very good course for 30 years. Other than for the last two years it has been one of the fastest growing countries in the European Union, and in terms of standard of living it has been one of the fastest growing countries. In fact, basically, things have been fine for us up to now. Will these same principles take us forward? I think that in the bigger picture, I don't see the need for any major, drastic changes, but we do need to make the correct tactical decisions at the right times. For example, in a situation where the economy is shrinking, I think the government ought to invest and contribute heavily," he explained.
Cutting back, he says, will not bring significant savings for the country.
According to Villig, the car tax is a painful but also logical long-term solution.
"I think most Estonians would agree that we don't like sitting in urban traffic, we don't like car accidents and we would like our urban environment to be greener and have less asphalt. And in fact, most European cities have understood this and are taking concrete action to change this, investing in public transport, light traffic routes and so on. We can see this in Tallinn too – the number of bicycles in the city has almost doubled in the last year. In fact, you can see that people like to use other modes [of transport] in the city, where they exist. But that requires money. The money has to come from somewhere, and I can see that a car tax to improve our transport network is a painful but logical solution," he said.
However, Villig denied claims that the introduction of the car tax was the result of lobbying by Bolt.
"We have nothing to do with it. Over the years, I have supported various Estonian political parties because I am an Estonian patriot, I want us to do well and I want our parties to make decisions that are good for Estonia, not decisions that suit one business or another. I have agreed with some of these decisions and disagreed with others. The car tax in particular, I think, is painful, but it is the right thing to do in the long run," he said.
Editor: Michael Cole