Gallery: Conference marks 30 years since introduction of the Estonian Kroon
Monday marked the 30th anniversary of the Estonian Kroon (EEK) becoming legal tender in Estonia, which it remained until 2011, and a number of key framers of the currency transition – a success despite initial opposition from the International Monetary Federation (IMF) – gathered at the Bank of Estonia (Eesti Pank) for a conference commemorating the event.
While the currency of the First Estonian Republic of 1918-1940 had also been named the Kroon, this was abolished following the First Soviet Occupation starting in 1940, while Estonia was forced to use the Ruble, the currency used across the Soviet Union, through to the restoration of independence. The Kroon remained legal tender to January 2011 when it was superseded by the euro.
Claudia Maria Buch, vice-president of the German Bundesbank spoke at the conference. The Kroon was initially pegged to the Deutsche Mark, thereafter to the euro after the latter became legal tender in much of the EU in January 1999.
"The success by Estonia in implementing monetary reform has been impressive, in establishing a modern financial system and managing the transition to a modern market economy," Buch said.
"This has brought with it prosperity and freedom to many, as we can see when we walk the streets of Tallinn, though I think there has been a lot of hardship and adjustment to external shocks that had to be dealt with," she went on.
With a panel chaired by former president Kersti Kaljulaid, Governor at the Bank of Estonia at that time, Siim Kallas, and Ardo Hanson, who sat on the monetary committee were also present at the conference, along with current governor Madis Müller, prime minister at the time of the transition Mart Laar, and veteran politician and Estonian independence leader Marju Lauristin.
AK: First Kroons doled out in batches of 150EEK per person
Meanwhile, ETV news show "Aktuaalne kaamera" (AK) reported on the reflections and memories of some of the aforementioned on that fateful day in June 1992, less than a year after Estonia restored its independence and when, after waiting for a long time in line, ordinary people could obtain a set amount of Kroons at the rate of 150EEK for 1,500 Soviet Rubles (which totals about €9.5 in current money).
Siim Kallas recalled sleepless nights from that time and not just because of the light nights of June; the International Monetary Fund (IMF) had initially not backed Estonia's monetary reform plans, Kallas said, which led to some hesitation.
"That was the case, though not very much. When you make such a giant leap you have to do so in the faith that it will all work out," Kallas told AK.
"I still have, somewhere, the IMF note recommending that we not go through with it," he went on.
"However, that's what we decided to do. In the end, [the IMF] agreed, and came to the rescue too," Kallas went on.
Ardo Hanson, a member of the national monetary reform committee and subsequently a Bank of Estonia chair reminisced about having bodyguards for the first time in his life.
He said: "I was working in the Bank of Estonia at the time. In the morning, two X men approached me and said that they would be responsible for my safety for the next 72 hours. I had never bodyguards like this before. It was a new experience which demonstrated that the matter was being taken very, very seriously."
As to what the first purchase the two men ever made using Kroons, for Kallas it was roses, bought by his wife for a friend whose birthday fall on the same day, while he himself likely bought a bottle of champagne, while Hanson bought a blue beret costing 5EEK (€0.32 in today's money) which, while he found it eye-catching, in the end never wore it.
ETV's comprehensive archive of AK reports reveals that at the time, a loaf of bread could cost around 0.5 to 0.9 EEK (around €0.30 to €0.60) before the 18 percent (at the time) sales tax was added, with more expensive brands costing as much as 1.30EEK (€0.83).
Monday's panel discussion chaired by former president Kersti Kaljulaid, who had also worked as an economic advisor to Mart Laar, looked more to the current challenges and the future, including how to get consensus on the implementation of the green transition.
While the full discussion is in Estonian in the video below, Claudia Buch is speaking in English (around 17 minutes 45 seconds to around the one-hour-twelve-minute mark).
The initial batches of kroons were printed at De La Rue in High Wycombe, England.
The smallest denomination one-kroon bill was later replaced by a coin, while other denominations primarily featured figures from the Estonian national awakening of the 19th Century, including poet Lydia Koidula (1843-1886, who graced the 100EEK bill) and Carl Robert Jakobson (1841-1882, 500EEK), while 20th century chess player Paul Keres' likeness appeared on the 10EEK bill.
While the Euro did not enter legal tender in until January 1999, monetary mechanisms such as the European Currency Unit (ECU) and the Exchange Rate Mechanism (ERM) had been in use alongside European Community member states ahead of the full emergence of the European Union in 1993. Many member states' currencies tracked the ERM, though the U.K. left the mechanism in September 1992.
Estonia joined the EU in 2004, and the eurozone in January 2011, meaning the Kroon ceased to be legal tender, after less than 19 years in circulation. A two-week transitional period was in place when either currency counted as legal tender, after which the Kroon was consigned to collections – though could still be traded in at banks in exchange for euros for some months thereafter.
The 30th anniversary of the Kroon's introduction is also being marked both by an exhibition at the Estonian National Museum in Tartu and by a set of commemorative stamps featuring designs from the Kroon bills.
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Editor: Andrew Whyte