Estonia joined the Euro zone as its newest member on Saturday. The move drew mixed reviews.
The small Baltic state became the first former Soviet bloc country to adopt the currency just after midnight. The country’s Prime Minister Andrus Ansip was the first person in the country to withdraw the Euro, officially switching from the Kroon. He withdrew the money from a cash machine in Tallinn, the country’s capital.
“This is a really important day for Estonia – to join the Euro zone. I’m happy,” he said.
Estonian officials say switching to the Euro marks the end of its struggles. The country has been in a deep recession since 2009 when economic output dropped by 14 percent. The government says that it hopes to encourage investors by assuaging fears of devaluation in its currency.
Estonia is a nation of 1.3 million people with a $19 billion economy.
Analysts say that the switch also tops off the country’s drive for integration with the West, away from the influence of Moscow.
Meanwhile an anti-Euro campaign continues in the country with opponents claiming, in a statement, that Estonia was, “getting the last ticket for the titanic.”
Nobel Laureate economist Paul Krugman claimed, in a blog, that Estonia’s switch to the Euro was at a high cost to the country’s economy.
Despite some of the pessimism, Estonian President Toomas Hendrik remains optimistic. “I think Europe should feel pretty good about it because it shows that despite all of the difficulties and hardships, it is in fact possible to have a budget deficit of less than three percent,” he said.
Poland, Hungary and other Eastern European members have refused to adopt the Euro. They say they’ll join when they see how the debt problems of Greece, Spain, Portugal and Ireland are played out.
Estonia will be the poorest member country to adopt the Euro, but its debt and deficit levels are among the lowest in the bloc.