Prodi says Estonia's early introduction of euro impossible

TALLINN (BNS) – European Commission President Romano Prodi said after a meeting with Estonian Prime Minister Mart Laar in Brussels on Jan. 21 that Estonia's idea of early adoption of the euro was impossible to carry out.

"We can't have any formal change without changing the [EU] treaty," Prodi was quoted by Reuters as saying. "Intellectually it's possible to say many things, so my answer is not possible now."

Also in a report on enlargement last year, the EC cautioned all candidates against early adoption of the euro.

Under EU rules a country must be a member of the EU and its exchange rate mechanism for two years before adopting the EU's single currency.

The Reuters report called into question the interpretation offered by the Estonian prime minister of the EC president's reaction to his proposal.

In a telephone interview with BNS Jan. 21, Laar said Prodi had "expressed readiness to discuss" introduction of the euro before Estonia's actual EU membership.

"Prodi considered this idea to be very intellectual and interesting," Laar said.

Laar also said that in suggesting the issue to Prodi he had not put forward Estonia's official position but had simply raised the topic.

"But the EU likes countries which come out with ideas, and Prodi liked the idea concerning the euro," Laar said.

The chief spokesman of Estonia's central bank, Andrus Kuusmann, said on the unexpected news from Laar that the Bank of Estonia "continues to be firmly convinced that Estonia's negotiating position in accession to the EU and via this, to the European Monetary Union, is the same as expressed earlier, or accession in three stages."

"Our vision is that it would be to the advantage of the Estonian economy to go through these three stages. We see no reason to force the pace," Kuusmann said.