WARSAW, Dec 30 (Reuters) - The European Union is likely to approve Estonia’s application for membership of the euro zone in the first half of next year, the International Monetary Fund’s head for Europe Marek Belka said on Wednesday.
Belka, who took part in the last meeting of euro zone finance ministers on Dec 1, told Reuters he was confident that the small Baltic Sea state would be invited to join the euro zone. Approval in the first half would allow the government to meet its target of joining by the start of 2011.
“I hope and I think there is a high likelihood that the EU will give Estonia the green light for euro adoption in the first half of 2010,” Belka told Reuters over the phone, clarifying remarks made earlier.
To adopt the single currency, now shared by 16 EU countries, an EU member has to meet criteria on low inflation, interest rates, debt and budget deficit as well as currency stability — all of which Estonia is expected to fulfil.
The EU’s executive Commission reviews Estonia’s efforts to meet euro zone entry criteria, and its invitation to join then has to be backed by EU finance ministers.
The European Central Bank, EU parliament and EU leaders are also consulted in a process that, if started early next year, would end in early July, allowing the candidate country to prepare for the switch-over to euro banknotes and coins from the start of 2011.
Reporting by Karolina Slowikowska, editing by Patrick Graham/Ruth Pitchford