Kallas is in a Hot position as EU-Russia relations drift apart

  • Kaja Kallas comes with a domestic victory.
  • The Estonian prime minister is adopting a remarkable role in the EU during the war in Ukraine.
  • The war in Ukraine is redefining the EU’s defense and raising concerns over the Baltic states.
Annika Haas – Riigikantselei (CC BY-SA 4.0)

Why is Kallas hot?

Answer: Kallas is bringing home a diplomatic victory by adopting a prominent role within the EU over the war in Ukraine

Since February 2022, Kaja Kallas has been asking the EU to decrease its energy ties with Moscow. Notably, she has convinced her European counterparts to adopt a harsher tone against Russia and to speed up the EU’s independence from Russian oil and, in the foreseeable future, from Russian gas. 

In late May 2022, the European Council agreed to ban all imports of Russian oil by the sea in its sixth round of Ukraine-related sanctions. This decision has been a driving force for the Estonian Prime Minister Kaja Kallas. In January 2022, before Russia’s invasion of Ukraine, she called to increase the EU’s independence from Russian energy. Thus, the European Council’s decision has secured a win for Estonia, Latvia, Lithuania and Poland, in their role against Russia in the ongoing Ukraine war.

Internally, Estonia, which shares a 183-mile border with Russia, is actually the European country least dependent on its gas. Roughly three-quarters of Estonia’s energy supply comes from domestically produced oil shale, giving it more independence. To speed up this process, Estonia accelerated the construction of an offshore terminal for non-Russian gas in the Estonian port of Paldiski. This project is one important piece of Europe’s strategy to quickly wean itself off the Russian energy.

The Estonian terminal will serve as a floating dock for a processing tanker that will receive deliveries of liquefied natural gas and convert it back into a vapor that can be piped through the existing network that serves the Baltics and Finland. In 2025, the Estonian, Latvian and Lithuanian electricity grid will be disconnected from the Russian and Belarusian grid and connected and synchronized to continental Europe’s energy system via Poland. 

To meet this grid change and Estonia’s decision to stop its shale power generation by 2035. This source of energy, in 2019, accounted for 57% of Estonia’s total electricity generation. Kaja Kallas is planning to build Estonia’s first nuclear reactor. This initiative will reduce Russian grip in the area and would make Estonia an energy transit area. 

What is changing Kalla’s temperature?

Answer: EU sanctions against Moscow and the victory in the recent elections solidifies her position.

Kallas has prioritized bolstering diplomatic ties with the EU and NATO members. For instance, Estonia’s military joined France on the mission in Mali and recently, a team of Estonian rescue workers also flew to Turkey following the recent earthquake. Additionally, Estonia remains the country in the world that has contributed most to the military equipment of Ukrainians in proportion to its GDP per capita. This help comes from Kalla’s diplomatic role, insisting that Ukraine has to win the war. For Estonia, the Russian attack on Ukraine feels like a shot across its bow. 

This effort has been a probe for the Estonian economy and has been centering Estonia’s internal debate. Prime Minister Kaja Kallas faced difficult times in 2021-2022 due to the energy crisis that severely impacted the economy, forcing many companies to close temporarily. The government had long refused to pay them aid, arguing that the country needed to adopt long-term solutions, before recognising that tensions between Ukraine and Russia (before February 2022) would further increase the already high gas prices. 

At the same time, Estonia’s inflation rate, in February 2023, slowed to 17.6%, one of the highest in the EU. Until recently, Estonia experienced high growth as it was one of the fastest in Europe to recover from the pandemic, with low unemployment and rapid growth in wages. This high inflation rate will be a pressure point for Kalla for two reasons. First of all, as part of the Eurozone, Estonia cannot set its own interest rate policy, unlike countries such as Denmark, Sweden, the Czech Republic or Hungary. Secondly, Kalla is concerned about state finances and does not want to let public debt spiral out of control. 

Despite the economic woes, Prime Minister Kaja Kallas’s pro-market Reform Party came in first and appears set to hold 37 seats in the 101-member legislature, three more than it previously had. This win gives her the leverage to lead the Baltic country’s next government and, thus, a vital link between Ukraine and the EU.

What is driving Kalla’s?

Answer: Kalla is driven by the goal to minimize any conflict with Moscow and strengthen Estonia’s diplomatic ties.

Kalla’s mother, grandmother and great-grandmother were deported to Siberia when Kallas’ mother was only a six-month-old baby. Her father is Siim Kallas, a well-known politician who has also worked for European institutions. Kallas was a member of the European Parliament from 2014 to 2018 and she was present when the EU-Ukraine Association Agreement was signed.

In the present crisis, Kallas has taken the lead within the European Union against Russia. For instance, her appearances in the international media have ensured Estonia punches above its weight as she has pushed other leaders to send more weapons to Ukraine, impose sanctions on Russia and called for the reinforcement of the three Baltic states. 

On security terms, Estonia has approved a €476 million defense spending hike. The majority of which is for short- to mid-range air defense systems. Simultaneously, US Secretary of Defense Lloyd Austin agreed on the presence of a US light infantry company and a HIMARS multiple rocket launcher unit in Estonia.

What does this mean for you?

Answer: Kalla’s role in the war in Ukraine inside of the EU shows how the Baltic states are taking a new role and highlights their strategic relevance.

Kallas sprang into action before the kick off the war in Ukraine and her fate is in sharp focus because of her role as one of Europe’s staunchest supporters of Ukraine. Her long-standing criticism of Russian President Vladimir Putin, which predated Moscow’s full-scale invasion of Ukraine, is now widely seen as prescient.  Kallas has managed a reinforcement of NATO troop numbers along Europe’s eastern edge. This decision is an early indicator of how she is getting leverage within the EU and NATO and how the Baltic states’ security has become a paramount point in the political and regional agenda for both the EU, US and NATO.