Huge Queues At Estonian Banks Ahead Of Euro Switch

31 Dec

TALLINN : Huge queues formed outside Estonian banks on Thursday, with many people wrongly worried they will no longer be able to use the kroon currency after the Baltic country switches to the euro on January 1.

“I have been in line for slightly over half an hour and will probably have to wait for an hour more. I want to exchange my savings, slightly over 45,000 kroons (2,876 euros, 3,804 dollars) into euros,” Vladimir, a 63-year-old Tallinn resident, told AFP while waiting in line at a SEB bank office in central Tallinn Thursday.

“I'll feel better when I have euros now and I want the money in cash because I don't trust banks,” he said.

“Anything can happen, maybe the rate of kroon to euro will be changed later,” 59-year old Maret, standing in the same queue, told AFP.

Estonia's kroon was pegged to the newborn euro in 2002 at a rate of 15.6466 to one euro and the rate has never changed and authorities have vowed it never will.

Estonia, an ex-Soviet republic of 1.3 million people which joined the European Union in 2004, will formally join the eurozone on Saturday as the world rings in the New Year.

A bank official said Thursday the queues indicated people were misinformed about the nuts and bolts of the currency switch.

“It seems that many people have failed to understand that they can still pay with kroons during first two weeks of January and after that they can change their kroons into euros in commercial banks” throughout 2011, Silver Vohu, spokesman to for SEB bank, told AFP.

Estonia's central bank will offer kroon exchange after this period with no time limit fixed. Kroons in private bank accounts will be converted into euros automatically on January 1.

Estonian police on Thursday also urged people not to carry large sums of cash with them, pointing to an elderly woman who was recently robbed while on her way to the bank to exchange her savings of 100,000 kroons (6,390 euros).

Despite the debt crisis which has deeply shaken the 16-nation eurozone, Estonian authorities firmly believe that joining it will improve their country's credibility with foreign investors and ease trade for its heavily export-oriented economy.

– AFP /ls

Channel News Asia

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