The wealthiest of the Baltic states, Estonia has enjoyed a close cultural and linguistic relationship with Finland.
Colonized by the Teutonic Order of Knights from 1346, Estonia became dominated by a German landowning elite, which maintained its social and economic position during Swedish occupation (1561–1721) and for most of the subsequent period of Russian rule. From 1855, when they could finally acquire land, Estonians in increasing numbers became independent and prosperous farmers. Migration also increased the Estonian population in the cities during this period. Clumsy attempts to introduce the Russian language and culture backfired. As a result of these factors, from the 1880s an articulate, self‐confident Estonian nationalism developed, and this accelerated after the Russian Revolution of 1905. After 1914, the independence movement was increasingly dominated by Bolsheviks, but during the German occupation in World War I a nationalist government was established.
The First Republic (1920–40)
After Germany's collapse in 1917, the government successfully fought the Communists, with foreign (particularly Finnish) help. After the proclamation of a republic in 1920, a land reform expropriated the wealthy landowners and thus increased support for the state among the mass of the peasant population. Its relative homogeneity (88 per cent were Estonians) led to an atmosphere of toleration, as Estonians could afford to appreciate the cultural distinctiveness of Russian, German, Swedish, and Jewish minorities. Remakably, Estonia allowed every minority that consisted of more than 3,000 people to constitute itself into a corporate body, and elect a representation with responsibility for clubs, schools and other cultural affairs. The country suffered serious economic and social dislocations during the Great Depression, which led to the increasing popularity of Fascist movements. To prevent their takeover, the President and leader of the Agrarian Party, Konstantin Päts, dissolved parliament and declared martial law in 1934. The authoritarian regime created new representative bodies, in which opposition was possible, and left the rights of the minorities untouched.
Under the terms of the Hitler–Stalin Pact, Estonia was overrun by the Red Army in June 1940, and incorporated into the USSR on 6 August 1940. As in the other Baltic States (Latvia, Lithuania), the Soviet regime hoped to weaken its national spirit though large‐scale deportations of Estonia's intelligentsia. Further deportations after the country was reclaimed from German occupation (1941–4) reduced the Estonian population within its own country to some 60 per cent. Nevertheless, Gorbachev's reformist policies of glasnost sparked off demands for independence, which was declared on 30 March 1990, and recognized by Yeltsin on 28 August 1991.
Renewed independence (since 1991)
The wealthiest among the Baltic republics (all of whose average income per head had been among the highest in the USSR), Estonia's economy stabilized by 1995 after undergoing a traumatic period of transition, though economic progress was still hindered by the prevalence of Mafia‐like gangster organizations. Initially, government policy against minorities was relatively harsh, but in 1995, a suggestion by the European Union was accepted whereby all residents who had lived there for a minimum of five years could become citizens if they so wished. The elections of March 1995 produced a victory for the ex‐Communist Coalition Party and Rural Union. Subsequent elections in 1999 and 2003 were won by a centre‐right coalition, which was presided over by a quick succession of Prime Ministers who struggled to introduce anti‐corruption measures against entrenched political and economic interests. Under Prime Minister Andrus Ansip since 2005, Estonia continued its economic growth, having joined the EU in 2004.