16 Conference Report #techonomy16

What Digital Society and Government Looks Like

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  • Techonomy16 conference in Half Moon Bay, California, Wednesday, November 9, 2016. (Photo by Paul Sakuma Photography) www.paulsakuma.com

  • Techonomy16 conference in Half Moon Bay, California, Wednesday, November 9, 2016. (Photo by Paul Sakuma Photography) www.paulsakuma.com

Speaker

Marina Kaljurand
Former Ambassador to the United States of America, Republic of Estonia

Interviewer

David Kirkpatrick
Founder and CEO, Techonomy


A conversation with Marina Kaljurand, former Ambassador to the United States of America; Republic of Estonia.

Kirkpatrick: We’re going to continue on a slightly more global theme with Marina Kaljurand, who until two months ago was the Foreign Minister of Estonia, she stepped down from that post to run for President.

Kaljurand: I lost!

Kirkpatrick: Yes, she lost but hey she has an amazing career so listen to this.  She’s done—I won’t even go back too far but she was Estonia’s Ambassador to Israel, then she was Estonia’s Ambassador to Russia at the time when Russia made its notorious and quite scary cyber-attack on her country and she was deeply involved in trying to respond to that. Then most recently she was for four or five years the ambassador to the United States and Mexico also. And then she went back to become Foreign Minister. Estonia as probably some of you know is a quite extraordinary country. Part of what we’re here to talk about is just all the things that are happening in Estonia when it comes to a digital society being created which is quite astonishingly advanced there. And separately Marina, because of that experience with Putin and Russia, has been drawn into the cyber-security and the cyber-warfare debate globally. She’s on a major U.N. taskforce on that topic, she’s her country’s representative to that work and she really has become very knowledgeable about cyber-warfare, cyber-security issues so we’ll talk about that as well. But Marina, start by just explaining what makes Estonia different and how it happened when it comes to a digital society.

Kaljurand: Well David, thank you for a very kind introduction it’s a pleasure and honor to be here, briefly we call it e-Estonia and we call it e-lifestyle, which means there are thousands and thousands of online services that are provided to our people, citizens and residents including online voting. We have had online voting now for five times, parliamentary elections, local elections Euro-parliament elections and nobody has so far proved—nobody has so far proved that online elections are less secure than elections on paper. So it’s a digital society and we have seen the developments in all spheres. Political spheres, fight against corruption, building up democracy, human rights, dignity, the questions that were discussed here. Economy, digital economy, shared economy, participation, for example, digital signatures, one of the services that we are providing to our people. Our population is 1.3 million. So far, we have written about 25 million digital signatures and every year we save 2% of GDP. Two percent of GDP is our defense expenditure, we’re members of NATO, which means defense expenditure comes free with digital signatures.

Kirkpatrick: You save it by doing what though?

Kaljurand: By digital signatures, which means that with electronic devices, being it cell phone or iPad, I can access the documents. We have two level security keys and through their passwords and through the code that they receive from the center I can sign the document.

Kirkpatrick: So, just the sheer efficiency of that is such a big saving in itself?

Kaljurand: Two per cent.

Kirkpatrick: And I’m sure you’re saving all kinds of money with other digital things you’re doing as well, like the digital land records, talk about that.

Kaljurand: Yes, well first of all, we started with the e-government we were the first country in the world to introduce paperless government and it’s really paperless. When I was Foreign Minister, I was attending the meetings, no difference where I was physically present, I could participate in the meetings of the government, sign digital documents and participate in discussions. And yes, some registries, we have only digitally. We don’t have them on paper, for example land registry. Which means we have to pay very, very much attention to cyber-security. Cyber-security, so that we secure the data, so that we have authentication of persons who are online, secure exchange of data, encrypted exchange of data and these are the main tasks that government is doing at the moment. And your question was?

Kirkpatrick: Well, just how you save money with the digital economy. But I guess, why did this happen?

Kaljurand: I’ll add one thing. For example, starting a business. You can start a business online in Estonia; you don’t have to come physically to Estonia. First, we have to identify the person with biometrics and everything, then you receive digital ID, it’s not a passport, it’s not a visa, it’s not a citizenship card. It’s a digital ID and with that card, you can start doing business in Estonia, signing documents, bank transactions and so on and so on. So, if you want to do business in the EU and you don’t want to see the bureaucracy of some of the countries, I’m not going to name then, come to Estonia.

Kirkpatrick: Is that happening, that people from outside of Europe are using Estonia as their point of entry because of those systems?

Kaljurand: Yes, I can bring examples, last year 14,000 children were born in Estonia. And 14,000 e-residents, digital e-residents registered themselves. People residing in other countries, people who are not residents and physical residents and who are not citizens of Estonia, who are doing digital services and taking advantage of the services. Which means, every year we will have 20,000, why not million? Then it means that our population of people who are paying taxes in Estonia and who are benefitting from our e-services is growing tremendously. I remind, our population is 1.3 million, we’re one street in Cairo [ph 6.22], yeah? [laughs]

Kirkpatrick: So, it’s kind of like a new form of free trade zone then in that sense in that it has the same kind of economic development impact by really differentiating yourself from the rest of Europe, although I—

Kaljurand: We’re not differentiating; we are members of the EU—

Kirkpatrick: I know that.

Kaljurand: —which means those rules and regulations apply also to us.

Kirkpatrick: Of course, I totally—

Kaljurand: But we make it just more and more simple.

Kirkpatrick: But I know that having heard your President Ilves talk about this on a few occasions, it drives him crazy how slow the rest of Europe has been to implement a lot of similar reforms and regulatorially, efficiency-wise and Estonia really is standing apart in terms of it’s capabilities, which has got to be economically beneficial but Europe is not keeping up with you in some other ways.

Kaljurand: Well, I can’t agree completely because there are countries in the EU especially in the Nordic-Baltic region, northern countries, Germany, other countries who are very much supportive and interested in internet services. And that is one of our programs to introduce Internet services, e-services throughout the whole of Europe and to show to all the members of the EU how much they can gain from that.

Kirkpatrick: So, consulting to other nations, in effect?

Kaljurand: Consulting to the nations, exchanging information, raising awareness, writing rules and regulations in the EU, talking at conferences. Using all the means and possibilities to introduce what we’re doing.

Kirkpatrick: We know Skype was invented in Estonia but—

Kaljurand: It was invented by Estonians.

Kirkpatrick: —by Estonians, but why did this happen in your country? How did it happen?

Kaljurand: Because if your look at our climate, it’s nonstop winter. It’s dark, it’s raining, we don’t see sometimes the sun for months.

Kirkpatrick: Sorry to hear that!

Kaljurand: I know. Don’t be sorry but that’s why we have Skype.

[Laughter]

Kaljurand: That’s why we’re teaching programming.

Kirkpatrick: You have a lot of geeks that just don’t have anything to do but go code or stuff?

Kaljurand: Exactly, that’s why we’re teaching programming to our first-graders and we have introduced cyber-hygiene in our schools and we have Masters programs in cyber, so that’s part. But to the other extent, I think that traditionally and historically education has been very, very important throughout the years.

Kirkpatrick: Even before the fall of the Soviet Union?

Kaljurand: Even before the fall of the Soviet Union. And if we look today at the OECD data then Estonia is among the top countries. Finland, Estonia, Singapore are leading in education.

Kirkpatrick: What year was Estonia created?

Kaljurand: Estonia regained independence first in 1918, was independent until 1940 for 22 years and then regained independence in ‘91.

Kirkpatrick: In ’91.

Kaljurand: So now we have been independent longer that we were in-between the two wars.

Kirkpatrick: OK, so in ’91 it’s the fall of Soviet Union. How quickly did these kinds of reforms—was it fairly soon after independence you had a blank slate? You decided let’s do it better and do it in a new way?

Kaljurand: Exactly, it was like that. After the fall of the Soviet Union, one was absolutely clear. We re-established our State and we didn’t want to continue like communists, Soviet Union. So it was important for us to come back to Europe, to come back globally. To be part of EU, NATO, other international organizations and that’s why we had to do the reforms. Nobody was inviting us to NATO; we wanted to go there. And that’s why we had to be efficient and that’s why we had to do the reforms. And fortunately, it was the period in history when everything was changing. ICT came to stay; cyber came to stay so we were also lucky with the timing, and determination.

Kirkpatrick: One of the things that I really want to move to is the cyber-security issue but maybe we could transition by talking about the data embassies. What are they and why do you have them?

Kaljurand: At the moment we are considering very carefully our government’s cloud services, how to keep data so that it’s accessible but at the same time also secure. So our concept is, we will keep one part of data in Estonia, in the servers that are in our territory but we also create data embassies. Which means that part of the data will be in servers in other countries, friendly countries, with whom we have bilateral agreements, so that we have control of those servers, of those physical buildings and accesses and security but it’s situated in another country, just for the case, if it’s needed to have data retrieved from other sources. Today, yes, we’re keeping also data in some embassies but we’re not renewing it online. And, of course, we’re going to use also, and we’re using already, international public clouds because they are just so cheap. They are so efficient and they are so easy to use but we have to be very careful with sensitive information.

Kirkpatrick: And what’s the circumstance under which you might need that?

Kaljurand: Well, we have our history. We lost independence at some point, we regained independence but I think with the knowledge of history we have to be prepared for everything. So, I’m not saying, we’re not afraid of any attacks, we’re not afraid of losing independence. No, I want to make it very, very clear. But it’ s always good to have somewhere backups.

Kirkpatrick: Yes, and even though maybe NATO can protect you—

Kaljurand: We’re members of NATO

Kirkpatrick: You’re members of NATO and your membership of NATO can protect you from a Russian attack on your physical territory, which we know is not inconceivable but certainly NATO would be there to help you. But it’s much harder for NATO to help you or to help its other member nations against cyber-attacks. I mean, if we’ve seen the United States, the White House, Google, the Democratic Party, have all been subject to incursions probably from Russian hackers, so you can’t be at all complacent about that and is that what you thing is most, the biggest risk?

Kaljurand: There is always a risk of cyber-attacks. Cyber-attacks are happening every day, every minute, every second. That’s a new normality. But you have to be prepared. We learned our lesson in 2007, when we had DDoS attacks against our website. We call them monumental websites, Presidents’ office, Prime Minister’s office, Ministry of Defense, we had those cyber-attacks and they took our websites down for some time, also, banking systems. And for a country that is so e-dependent, it means a lot. So, those attacks they were not destructive. Nobody died, nobody was shot, but they were disturbing. We learned our lessons. What is important? You have to keep your house in order, you have to have your action plans, your strategies, you have to cooperate with others. Cooperation is crucial in international—if you want to talk seriously about cyber-security. So, in the United Nations, we are at the moment talking. Yes, sometimes it’s a clash of different mentalities and different ideologies but we have to be, at the same table, we have to discuss and we have to agree, how do norms apply to cyber.

Kirkpatrick: As a professional diplomat and expert in the cyber-security area, how would you characterize the state of international cooperation on this issue right now?

Kaljurand: I think it depends on the forum. Different organizations have their specific interests. I am very happy for example with the results of the Warsaw summit of NATO last summer, which, for example, determined cyber as a new field of operations. And the strategy that was adopted there, cyber-exercises, cyber-ranges, everything is moving in the right direction. EU is much more about internet services, it’s much more about working with private companies, partnership with private companies, cyber-security, overseeing organization of security in Europe, doing more with confidence-building measures, meeting people, talking to people, exchanging strategies, learning from each other’s experiences, exchanging best practices. And the United Nations has the biggest platform, where we have been discussing for the last couple of years in different GG groups about international law. How does international law apply to cyber? Because cyber is not the jungle. International law applies to cyber, we have agreed on that, now the question is how? Because, honestly we don’t have much state practice, where we can see how states apply international law. Yes, we know there is a UN charter, yes we know there are some conventions that we might talk about but now we need practice. And in Tallinn we have, for example, the Center of Excellence of NATO, which is a think-tank type that is doing great work with international law and analyzing international law for cyber. So, experts have done their job, now it’s up to the governments to start interpreting, to start applying, and to start applying in practical terms. And I very much liked what you raised. Gender, women in ICT, it gives many new possibilities, many new options but it also brings along risks that we didn’t know about some tens of years ago. So, I think it’s important that we talk. I’m a diplomat. I prefer talking. So even if we have different ideologies, it’s better to be at the same table with all stakeholders. So in the United Nations we’re talking with states and governments and of course, we need something else, we need something additionally, where we get together governments, private sector, academia, experts. We need also that forum, so it’s never enough of exchanging and talking.

Kirkpatrick: I want to hear the audience but you are an expert in Russia. Donald Trump also says he wants to talk more to Russia. How do you feel about the way he talks about Russia and Putin?

Kaljurand: Come on, David. I’m a diplomat. I’m not going to comment about your President-elect!

[LAUGHTER]

Kirkpatrick: I’m a journalist. I’m just trying to press you!

Kaljurand: [Laughs]

Kirkpatrick: So, you’re not going to talk about that, at all.

Kaljurand: No, no, no.

Kirkpatrick: Okay, well that’s an answer in itself.

Kaljurand: But I can say generally, that the United States have been our very close allies bilaterally, in NATO, in international organizations. I very much hope that it will continue. And at least we are dedicated to continuing close cooperation in cyber-security. Because we need the voice of the US in all the organizations I mentioned. We are like-minded. We have to work together if we want that our message gets out. And I very much hope that the cooperation will continue.

Kirkpatrick: You’re like-minded and your President even grew up in New Jersey as I understand it. So, what about the audience, who has a question or comment?  Identify yourself.

Kirkpatrick: I don’t think his mike is working but we heard the question. What would you have done differently if your country had been much larger?

Kaljurand: It’s a very good question. I think that what was the driving force behind our e-reforms was the wish to be a democracy, to take advantages of ICT in all spheres of life, also civil society, I didn’t mention it before. And I think that thanks to cyber, size doesn’t matter as much as the size of a country mattered maybe some centuries ago. It doesn’t matter so much of the army, of the number of people, even how rich the country is. Efficiency is more important.  Maybe thanks to the fact that we are like a county club, we have less bureaucracy. Everybody knows everybody but it’s not an excuse. If we can do online voting or if we can provide about a thousand services to our citizens and residents and also people from abroad, then every country can do that if there is a will and if they are wishing to do that. And, of course, we have been very open for learning from experiences of other countries. So it’s not that we’re going round preaching our truth. No. We have our experience, every country has that country’s experience and we’re very open to exchanges.

Kirkpatrick: I think you would be a good diplomat. Unfortunately, this will have to be the last question but identify yourself please.

Reynolds: Josh Reynolds, Quantifind. There’s a relationship between how a society or a government expresses itself digitally and the core culture of that company. So, I had a similar question but not about size. My question to you is, the success of which you’ve had in Estonia, from your perspective, how much of that comes down to the unstoppably curious culture of Estonia and I’ve got Caspar Canarpo [ph 20.11] who I know who lives there, been a good friend for years. The most curious people on the planet I’ve encountered are there. What’s the relationship between culture and making all this work?

Kaljurand: I think that culture has a big impact and if I might say about Estonia, we are very Lutheran. We are very hard working. We are not used to parties, we don’t know what siesta is, we’re just working, working, working. So, maybe that’s also part of our nature and part of our culture. But why we have been successful with introducing e-services and digital lifestyle, I think that government started from the right side. Government didn’t impose anything on citizens, on people but the initiative started from people. They were standing in the queues for filling in taxation forms like your still standing. They wanted to change the system, government provided Internet taxation forms. Now it takes five minutes to do it online. I’m doing it every April, online, five minutes. People were standing in the queues in the banks to get either money of to do bank transactions. Government provided Internet banking. So, government started from the services that people were really interested in. Some didn’t go so easily, for example, we have e-school, so that we can follow the grades and we can communicate with teachers online. By the way, we do come out from our homes. We do talk to people and we do like people but sometimes it’s just more convenient to do it either from our office or home. And we have seen reluctance, for example, from older teachers, from doctors that are not interested in giving up data. Our logic is, “I own my medical data. And I give access to this doctor, this doctor, this doctor, this nurse. Not the hospital, but I own, I give that access.” And I think the things that government started doing were useful to people, people supported it and there was huge trust in government. Question of trust, if there is no trust, you can’t do anything. And trust, awareness-raising, right programs, right things and it works perfectly well.

Kirkpatrick: Well thank you. I love your spirit. I would love to be sitting across the table negotiating with you.

Kaljurand: You can apply for a digital ID.

Kirkpatrick: I should, I think anyone here should. So thank you so much Marina.

[END]

Transcription by RA Fisher Ink