ESTONIA: Euro is now absolute certainty
14.07.2010, 11:21Estonia will join the Eurozone on 1 January 2011, with the official exchange rate set at one euro to 15.6466 Estonian kroons.
Yesterday, 13 July, EU finance ministers gave the green light to Estonia's admission to the Eurozone as of 1 January 2011. "We have approved all the documents regarding Estonia's adoption of the euro," Didier Reynders, Finance Minister of Belgium, the country that currenty holds EU presidency, told journalists yesterday in Brussels.
The approval of Ecofin, a council consisting of all finance ministers of the EU, was the last stamp Estonia needed on its application. In May and June, Estonia received recommendations from all other major European institutions: European Council, European Parliament and the European Commission.
Ecofin also set the currency conversion rate to EEK 15.6466 for EUR 1, which is the same rate Estonia's currency has been pegged to euro since 1999. Ecofin's decision will expand the common currency area to 17 countries.
Estonians believe swapping their kroon, which was introduced in 1992, for the euro will encourage foreign investment, enhance stability and therefore also economic growth.
However, acceptance of Estonia to the eurozone was not the most important topic at Ecofin's meeting yesterday, where financial supervision issues and reinforcing economic policy cooperations were the priorities instead. The finance ministers also launched an Excessive Deficit Procedure (EDP) on Denmark, Bulgaria, Cyprus and Finland.
In the context of EDP, Estonia was congratulated by Olli Rehn, the European Commissioner for Economic and Financial Affairs, as Estonia along with Sweden and Luxembourg are the only countries not being subjects of the procedure. "Doux points to all these three countries," said Mr Rehn to journalists in Brussels.