Economics, EU – Baltic States, Financial Services, Investments

"I think any investor, any producer who decides to invest, will choose an environment where the euro has been introduced and where he doesn't have different risks connected to rumours about a change in an exchange rate," Rimsevics said.

Estonia hopes this summer to receive a nod from the EU to switch to the euro on January 1, 2011, becoming the third ex-communist economy to enter the 16-nation eurozone after Slovenia and Slovakia, writes LETA.

It sees the move as a crucial boost that would "increase trust in Estonia's economy, which will in turn bring more investments and help to create new jobs," Estonian finance ministry spokeswoman Kristi Joesaar told AFP.

Top regional player Swedbank backed that stance, saying in its recent outlook that "euro adoption is expected to spur investments in the Estonian economy."

"We forecast a decline of risk estimates, which would bring cheaper and bigger capital inflows, make investments more attractive, and, hence, contribute strongly to growth, which will mostly manifest itself in 2011," it said, adding that Estonia's joining the eurozone might divert some investment away from its neighbours.

That could leave Latvia – the most recession-afflicted member of the 27-nation EU, after an estimated 18-% economic contraction last year – lagging still further behind.

"I think when Estonia undoubtedly joins the euro as they're planning, of course they will gain a step ahead of Latvia," Latvia's Economy Minister Artis Kampars told AFP last week.

The crisis in Greece may be putting the euro under pressure, but Estonia, Latvia and fellow Baltic state Lithuania view the euro as a safe haven after a deep recession that has seen their economies wither after years of spectacular growth.

The trio have undertaken biting austerity drives to deal with double-digit slumps but the three have otherwise followed different anti-crisis paths. Estonia dipped into its reserves to help bridge a swelling deficit, a move that appears to have enabled it to stay below an EU-set hurdle for eurozone entrants.

Estonia and Lithuania both tapped international markets to finance gaps in their public finances.

Former EU growth-topper Latvia, meanwhile, was forced at the end of 2008 to turn to the EU and the International Monetary Fund for a lifesaving EUR 7.5 billion credit line.

It is eyeing eurozone entry in 2014.

Lithuania, which missed meeting the eurozone entry criteria by a hair's breadth in 2007, also hopes to adopt the currency in around 2014.

Joakim Helenius, the head of Trigon Capital, an investment firm with offices in all three Baltic capitals, questioned the idea that Estonia would suck away investment from Latvia and Lithuania. But he said the euro would "simply speed up the rate at which Estonia increases its GDP per capita" compared to its neighbours.

Estonia already has the edge. According to IMF data its GDP per capita, based on purchasing power parity, was 18,051 dollars in 2009, compared to Lithuania's 15,803 dollars and Latvia's 14,309 dollars.

During a recent visit to Latvia, Estonian Prime Minister Andrus Ansip played down the potential impact, however.

"This enlargement of the eurozone will support economic development in the whole region," he told reporters. "There's no competition in this regard."

The Baltic trio, which have a combined population of 6.8 million, are close-knit. Their economic fates have also remained intertwined.