Determinants of Environmental Clean-up in Estonia

In the early 1990s, the government of Estonia determined that it possessed neither the technical nor the financial resources to clean up Estonia's Soviet-era pollution satisfactorily. Yet data reveal that, during the 1990s, Estonia was relatively adept at cleaning up old contamination. In this paper we identify the key determinants of Estonia's relatively high level of success at environmental remediation. Content analyses of clean-up experiences were performed for three main categories of contaminated sites: ex-military, industrial, and municipal. All analyzed sites were identified by the government of Estonia as priority environmental hot spots in the early 1990s. The most successfully remediated sites were recipients of foreign direct investment or foreign aid, or both, and particularly aid from international financial institutions (IFIs). IFIs and foreign private actors were persuaded to act because of their confidence in the income-generating potential of the projects. In light of this finding, revisions must be made to an oft-cited model of ‘institutions for international environmental cooperation’. In its current form, this model downplays external actors' market-oriented motives.