Analytics, Estonia, Financial Services

“The Estonian economy is based on a number of solid foundations which create all preconditions for successfully overcoming the global economic crisis. The principal one among these is the monetary committee system and the fixed exchange rate of the kroon which guarantee confidence and the competitiveness of the economy and keep the price levels stable,” said Kaasik, adding that due to the monetary committee system, Estonia cannot be forced to change the exchange rate.

Kaasik was convinced that even if there would be major setback from a market that is important for Estonia, the Estonian kroon and Estonia’s economy will withstand it.

“If we were to look at the current problems in Estonia, these are not based on the wrong exchange rate. Hence devaluation is not necessary nor beneficial for Estonia or for Estonia’s economy,” he continued, noting that the contrary would be more true.

“Estonia’s reliability would also get a painful blow and catching up with the European Union average might be halted for a longer period of time,” estimated Kaasik.