in the late 90's and early 91's, the Soviet power threatened
to use force to impede independence, and it resulted in
several clashes between Soviet troops and nationalist
groups. In September, conservative forces in Russia carried
out a failed coup against Mikhail Gorbachov, Boris Yeltsin
had actually taken power, and only now did the Soviet Union
recognize the independence of the three Baltic states. The
same month they were admitted to the UN.
In January 1992, President Savisaar and his government
withdrew after growing criticism of its economic policies.
Parliament appointed former Transport Minister Tiit Vahi to
lead the new government. Estonia was forced to introduce
food and fuel rationing after Russia raised prices and
restricted supplies. Prices came up at world market level
and at the same time Russia restricted imports of textiles
and electrical products from Estonia.
On June 20, 1992, the country's new constitution - based
on the 1938 Constitution - was passed by a referendum. In
September, a new Riigikogu (parliament) was elected,
declaring on 7 October that the transitional period had
ended and that the country's new constitution was in force.
On October 5, the leader of the National Party, Lennart Meri,
was elected by the parliament to the country's president by
59 votes to 31. At the same time, the country was the first
country in the former Soviet Union to declare the ruble as
currency and introduce its own coin foot, the Crown.
In December 1992, the privatization program was
temporarily suspended after a high-ranking official was
dismissed for neglect and dishonesty. At the beginning of
1993, it emerged that he had been committed to giving back
state property to their former owners, who had been
confiscated by the Communists in their 40's.
In June 1993, strict nationalist guidelines were adopted,
which affected foreigners in the country - primarily the
Russians, who made up 30% of the country's population. They
either had to obtain a residence permit or be deported. In
return, Boris Yeltsin ordered Russian deliveries of natural
gas interrupted and at the same time halted the withdrawal
of Russian troops from the Baltic. At the end of June, the
Russian people conducted a referendum and declared its
autonomy, which was nonetheless characterized as illegal by
the Estonian government.
The Russian troops completed their withdrawal from
Estonia in August 1994, with Estonia already deeply
committed to NATO's Partnership for Peace program. Two
months later, the former chairman of the Estonian Communist
Party, Indrek Toome, was arrested for corruption.
The March 1995 elections became a major defeat for the
coalition that had ruled the country since it disbanded from
the Soviet Union. It sparked considerable controversy when
the country's new prime minister Tiit Vahi appointed a
"disproportionate" large number of former communists to
ministerial posts in his new government. In October, his
government was forced to resign following corruption charges
against the interior minister. A new government was now
formed, which also included members of the Reform Party.
Following a controversial vote in an electoral college,
on September 20, 1996, Lennart Meri was re-elected as the
country's president. In December 1997, a report by the
European Reconstruction and Development Bank, which had been
set up to support the transition of the former socialist
countries to the market economy, estimated that Estonian
financial sector reforms made it possible for the country to
enter the EU quickly. The reforms included has been
instrumental in securing the country's most foreign
investments per year. resident among the countries of the
In February 1998, Estonia, Latvia and Lithaun signed an
Association Agreement with the United States, at which time
the superpower also undertook to work for the three
countries' accession to NATO. It triggered a reaction from
Russia stating that the country would only normalize
relations with the Baltic countries when they guaranteed the
rights of the Russian speaking population.