Järvan: No Lobbying Necessary for Euro Adoption

Järvan: No Lobbying Necessary for Euro Adoption

Category : Pravda

Originally written for Pravda paper, published on January 21st.  Slovak and edited version to be found hereunder.

Aare Järvan, advisor to several PMs and Finance Ministers is also known as euro-man in Estonia. I have interviewed him (again) on January 20th. Here is what he said:

Q: Estonia have always wanted to adopt euro as soon as possible. Now it seems your country is fulfilling the Maastricht criteria and have brussels support. What would possibly must happen to prevent Estonia from introducing euro?

A: Hopefully nothing will go wrong. But we are still looking for the end-2009 results on public deficit and the GDP Both are due to be released in March. Most likely there will be no breach to the Maastricht reference value.

Lithuania was refused euro in 2007 by about 0,01% in inflation criteria. In Eesti Ekspress they wrote something like that according to Märt Kivine from WB Estonia might get euro even if its deficit is more than 3%. Is Estonia lobbying in Brussels in its favor, in order not to be rejected because of some Lithuania-similar excuse?

We do intend to meet the criteria without any specific lobbying. But indeed there are some differences in the “mathematical strictness” of the different criteria in the Treaty. On fiscal deficit the criterion itself is the requirement, that “the Member State is not subject of a Council decision under Article 104(6) of this Treaty that an excessive deficit exists“. As you know, the decision on the existence of excessive deficit has to be based on several additional qualifications besides breaching the 3% threshold. In this sense the inflation criterion has much stricter definition in the Treaty.

As I said, our last year’s deficit is most likely going to respect the reference value. Thus there will be no reason to trigger any additional assessment.

The government made massive cuts in order to get budget deficit under 3%, are people still so supportive, even if they are loosing social and other benefits?

People in general have understood and supported the budgetary measures. Recent polls indicate still strong support for the governing parties.

Some critics called for delaying the adoption of euro (last I read was Äripäev analyst Raivo Sormunen), some of them wanted to devaluate Kroon. Is any of these options still possible?

Such thoughts are usually hard to understand and definitely worthless to consider at this juncture.

According to Latvian central bank chief Ilmars Rimsevics, with euro Estonia could attract more investors away from Latvia. Do you think, or even hope so?

I am sure that the adoption of euro in Estonia will be beneficial for the region as the whole including Latvia. I would not be surprised when Latvia and Lithuania will became next entrants to the eurozone.

EDITED VERSION IN SLOVAK:

Estónsko vždy chcelo prijať euro čo najskôr, hovorí v rozhovore pre Pravdu Aare Järvan, označovaný aj za „euromuža“. Poradca viacerých predsedov vlád a ministrov financií je presvedčený že euro pomôže nielen jeho krajine, ale aj celému regiónu.

Zdá sa, že Estónsko plní všetky kritériá na prijatie eura. Môže sa vôbec ešte stať, že na európsku menu nepresedláte?
Dúfam, že sa nestane nič. Čakáme ešte na pár výsledkov, rast HDP a defi cit rozpočtu za minulý rok, ktoré majú byť zverejnené v marci. Je však veľmi pravdepodobné že Maastrichtské kritériá neprekročíme.

V roku 2007 zamietli vstup Litve, pretože mala infl áciu vyššiu o stotinu percenta. Hovorí sa však, že váš defi cit bude posudzovaný miernejšie, prípadne odobrený aj nad referenčnú hodnotu. Máte dobrých lobistov v Bruseli?
V každom prípade, kritériá chceme splniť aj bez nejakého špeciálneho lobingu. Máte však pravdu v tom, že je rozdiel prísnosti, ktorou sa posudzuje infl ácia a defi -cit. Vyplýva to však zo zakladajúcich zmlúv, nezáleží na krajine.

Vláda robila viac než rok masívne škrty vo všetkých oblastiach, ľudia prišli o sociálne dávky. Myslíte, že podporujú euro aj za takúto cenu?
Myslím si, že občania rozumeli, prečo sme tieto opatrenia museli urobiť, podporovali ich. Aj posledné prieskumy ukazujú stále silnú podporu pre vládne strany.

Niektorí kritici však stále žiadajú neprijať zatiaľ euro, prípadne aspoň devalvovať menu pred prechodom.
Takéto myšlienky sa len ťažko chápu. Navyše momentálne sa nachádzame tak ďaleko, že sú defi nitívne mimo hry.

Šéf lotyšskej centrálnej banky sa vyjadril, že Estónsko s eurom môže k sebe prilákať viacero investorov. Myslíte si to tiež?
Mať euro, samozrejme, znamená výhodu. Som si však istý, že ak ho prijmeme, bude to prospešné pre celý región vrátane Lotyšska. Vôbec by ma neprekvapilo, ak by sa Lotyšsko a Litva stali po nás najbližší členovia eurozóny


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