Estonia euro adoption

Estonia's hopes of becoming the next European Union member state to adopt the euro as its national currency received a slight boost Monday with comments from EU Economic and Monetary Affairs Commissioner Joaquin Almunia suggesting the Baltic state could receive an invitation to the eurozone as early as June 2010.

'Estonia could secure approval in June 2010 to adopt the euro currency in 2011 if everything goes well,' Almunia told Austrian weekly Profil.

The news was welcomed in Estonia, where the government of Prime Minister Andrus Ansip has made euro adoption its 'exit strategy' for a deep economic recession.

Finance Minister Jurgen Ligi told the Baltic News Service that Almunia's comments were generally welcome but were simply 'an opinion' rather than a strong statement, and would have no effect on Estonia's plans.

Officials from the European Central Bank and European Commission are expected to make a decision about Estonia, following an inspection in April 2010.

If Estonia meets all necessary criteria, the Estonian kroon could be replaced on January 1 2011.

On October 26 a mission of the International Monetary Fund (IMF) said euro adoption for Estonia in 2011 was 'within reach' provided the Baltic state could keep control of its budget deficit.

In order to qualify for the euro, Estonia must keep its government budget deficit below 3 per cent of gross domestic product (GDP).

The Estonian economy is expected to contract by around 14 per cent in 2009.