Estonia Become 17th Eurozone Member

1 Jan

TALLINN: Estonia adopted the European single currency at the stroke of midnight ringing in 2011 as the 17th member of the eurozone, amid concern over bailouts in Greece and Ireland and debts in Portugal and Spain.

As a fireworks show burst colourfully in the sky over Tallinn the nation of 1.3 million people bid farewell to its kroons, adopted in 1992 to replace the Soviet ruble.

“Estonia is the poorest country in the eurozone, so we have a lot of things to do after the goal of joining the eurozone has been accomplished,” Prime Minister Andrus Ansip said hailing the historic moment.

In a symbolic gesture, he withdrew a new banknote from an automated bank teller at the official ceremonies ushering in the euro at the national opera house as onlookers braved subzero temperatures.

“Estonia's entry means that over 330 million Europeans now carry euro notes and coins in their pockets,” European Commission President Jose Manuel Barroso said Friday ahead of the official midnight switch.

Most surveys put support for Estonia's entry into the crisis-hit eurozone at around 50 per cent, with almost 40 per cent opposed.

“Of course it is a problem that support for the euro is low, but I believe it will increase like it did in Slovakia. Estonian kroons have nice pictures on them, but unfortunately investors like euros better,” Estonia's Prime Minister Andrus Ansip has told reporters.

“I'm also sure the euro will have a great future,” Ansip said.

Opponents say that Estonia's timing could not be worse with the euro under threat after bailouts in Greece and Ireland and concerns about Portugal and Spain.

Estonian President Toomas Hendrik Ilves meanwhile highlighted the symbolism of becoming the eurozone's third ex-communist member, after Slovenia in 2007 and Slovakia in 2009.

“Joining the eurozone in January 2011 will mean arriving in Europe again,” Ilves told AFP.

Estonia entered the EU and NATO in 2004, and Europe's passport-free Schengen zone in 2007.

The kroon has been pegged to foreign currencies from the start, first to the deutschmark and then, in 2002, to the then newborn euro. The rate of 15.6466 kroons to one euro has never changed.

To avoid a frenzy, customers have been able to swap kroons for euros commission-free since December 1, and will be able to use them alongside the euro for the first two weeks of January.

Money deposited in accounts will be converted automatically.

Kroons will be able exchangeable at selected bank branches until the end of 2011, and at Estonia's central bank for an unlimited period.

– AFP/fa

Channel News Asia

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