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Estonia adopts the euro currency

The Baltic state of Estonia has become the 17th European Union member to adopt the joint European currency, the euro.

The small nation's decision to change from the Estonian kroon to the euro was the final step in a two decade-long effort to integrate its economy with Europe after it achieved independence in 1991. It is the first former Soviet republic to join the single currency club.

Estonian Prime Minister Andrus Ansip was the first person in the country of 1.3 million to withdraw euro notes from a cash machine specially installed for the midnight changeover at the opera house in central Tallinn.

Mr Ansip's example was followed by EU transportation commissioner Siim Kallas, Lithuanian Prime Minister Andrius Kubilius and Latvian Prime Minister Valdis Dombrovskis.

The four men waved their fresh euro notes at a crowd of some 5,000 cheering people as New Year fireworks burst in the cold night marking the advent of 2011 and a new era for Estonia.

"The euro is first and foremost a guarantor of our security. We are now full-fledged members of the world's second largest financial region with all the consequent obligations that this brings," Ansip said, after withdrawing the euros.

"The euro is a good thing. The world is now probably going to see us as being a developed nation," said Erik Villemson, a 21-year-old university student.

The inclusion of Estonia in the 12.5 trillion euro area is being touted for it's symbolic importance after the currency was battered throughout 2010 by bad news. Two members - Greece and Ireland - required international bailout funds to avoid bankruptcy.

Estonia could be the last new entrant for several years as all other potential newcomers from Eastern Europe either shy away from adopting an unpopular currency or fail to meet criteria on budget deficits and inflation.

Hours before the currency switch, European Commission President Jose Manuel Barroso welcomed Estonia to the euro zone, saying the euro would boost the nation's economy and send a powerful message to all EU members. "It is a strong signal of the attraction and stability that the euro brings to member states of the European Union," Mr Barroso said in Brussels on Friday.

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