LUXEMBOURG (MNI) – Estonia is set to move one step closer to Euro
adoption on Tuesday, with European Union finance ministers expected to
recommend that the country be allowed to join the Eurozone currency club
on January 1 2011.
The decision, expected to be formalised later Tuesday, will pave
the way for European Union leaders to discuss the topic at their meeting
June 17. The leaders’ approval would allow Estonia to become the
seventeenth Eurozone member at the start of next year.
But the decision about to be taken by finance ministers glosses
over a split between the European Commission and the European Central
Bank.
While the Commission concluded that Estonia “clearly fulfills” the
criteria to join the euro, the European Central Bank has voiced concerns
about the sustainability of the country’s low inflation rate.
“There’s no room for high inflation,” Estonian Finance Minister
Jurgen Ligi told reporters as he arrived for the meeting of EU finance
ministers.
“The ECB always expressed concerns about inflation during previous
accessions,” he said.
The minister said it was “still good” for Estonia to join the euro,
despite recent market pressure on the currency and political differences
within the currency union.
“Being pegged [to the euro] we get the problems of the Eurozone
anyway,” he said.
–Luxembourg: 0032 487 (0) 32 803 665, echarlton@marketnews.com
[TOPICS: MT$$$$,M$$FX$,M$$EC$,M$X$$$,M$$CR$,MGX$$$]