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The President of the Republic at the Conference dedicated to the 10th Anniversary of the Re-introduction of the Estonian kroon, 11 June 200211.06.2002
Alternative Exchange Rate Regimes in the Globalised World
Dear participants!
Excellencies!
Estonian currency - the kroon - has been one of the symbols of the restoration of independence. The introduction of our own currency was visualised already in the proposal made in September 1987 called IME which is the Estonian acronym for "self-managed Estonia" and is also the Estonian word for miracle. This has been considered the first basic economic framework in Estonia still struggling for independence.
We can firmly say state that the Estonian kroon has been a project owned by the Estonian people. We all remember the enthusiasm of the people discussing the design of the banknotes and coins. And the determination to reintroduce the kroon, although financial centres warned us of all possible threats and risks.
The Estonian kroon had to prove the capability of our people to manage our country. The people agreed to use a part of our national wealth - the Estonian forest - to back the kroon. The best stands were chosen and reserved for potential repercussions. On the other hand we knew that there would never be a need to resort to the forest, as the stable kroon was to be an integral component of the stable country. The stability had three pillars: the exchange rate peg to the German mark, a currency board arrangement and a firmly balanced national budget. Ten years ago, just before our Victory Day and Midsummer Day, each resident could exchange banknotes, which for decades had symbolised foreign power, for our own currency - Estonian kroons.
It is appropriate to emphasise and recall the solemn moment, as accession to the European Union will bring along a changeover from the kroon to the euro. A similar changeover from the national currency to the euro has required major changes in attitudes in European large countries with long traditions of their own currency. Giving up national currency is equally painful for countries that have recently gained independence. We can ask, what will we have left? What will define the independent statehood and the people's sovereign right?
I do believe that our pragmatic attitude and centuries-old ability to adapt will help the Estonian people in all-European integration and globalisation process. Just like when introducing the kroon we valued apart from the historic-political aspect also its economic advantage, now we are able to see apart from the economic advantages of the euro also its symbolic meaning.
It is not correct to speak about the replacement of our "own" currency with the euro; it sounds as if we oppose two currencies - "ours" and "theirs". Estonia's accession to the European Union and the changeover to the euro at a later date can take place only at the discretion of our people. It can be as a natural development, confirming and strengthening Estonia's belonging to Europe.
Estonia's strength and sustainable development will depend on our capacity to use our presence in Europe. We have to take into account the existing rules. However, Estonia will also have to actively participate in shaping the rules. Building Europe Estonia will also build its own future.
Ladies and Gentlemen!
On the tenth anniversary of the re-introduction of the Estonian kroon I would like to stress that currency - be it a national currency or regional single currency - is just a vehicle. The society will become sustainable only through our work, culture and stability-oriented policy.
In today's Estonia we will have to think of the strengthening of the founding pillars, which should secure the balanced development of the society. Balance cannot just be achieved through efforts of single political forces. Estonia requires a new national pact. It is possible to agree upon different issues as proven ten years ago upon the re-introduction of our currency.
Marking the first and probably the last ten years of the Estonian kroon, we should also think of the necessity and possibility of reaching new national pacts.
I wish you a successful conference.
Thank you for your attention.
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