The 2018 convergence report concerning the state of preparedness of non-Eurozone countries to adopt the single currency, which the Commission published on Wednesday 23 May, indicates that none of the seven countries concerned meets all criteria laid down. Croatia and Bulgaria only need to meet one criterion concerning the exchange rate.
The report concerns Bulgaria, Croatia, Hungary, Poland, the Czech Republic, Romania and Sweden. It is of particular relevance for Bulgaria, which plans to apply in June to join the Exchange Rate Mechanism (ERM II), thereby launching a process at least two years long leading up to accession to the Eurozone (see EUROPE 11937).
“We welcome the current work by the Bulgarian authorities” in this area, Valdis Dombrovskis, the Commissioner for the euro and Social Dialogue, told a press conference (see other article).
Reiterating his comments from the 'Ecofin' Council of late April, Pierre Moscovici, the Commissioner for Economic and Financial Affairs, warned against excessive haste in bringing new members into the Eurozone fold (see EUROPE 12011). He added, however, that he was looking “serenely” upon this prospect of enlargement.
Readers may recall that all member states, with the exception of the United Kingdom and Denmark, have are obliged to join the Eurozone. To do so, they must comply with the following convergence criteria: price stability, sustainable public finances, convergence of the long-term interest rates and exchange rate stability.
Although joining the Eurozone is not in the immediate future for either country, Bulgaria and Croatia currently meet all the criteria with the exception of the exchange rate, itself linked to joining the ERM II mechanism. Croatia seems to be in the lead, as its national legislation is compliant with the rules of Economic and Monetary Union (EMU), according to the Commission.
Unlike Croatia and Bulgaria, Romania meets only one criterion, that concerning public finances. Sweden meets the same criteria as Bulgaria, but for this member state, not joining the Eurozone comes down to a lack of political appetite.
In early May, the Commission confirmed that it was to present a convergence mechanism aiming to help non-Eurozone countries wishing to adopt the single currency (see EUROPE 12013).
The publication of this convergence report by the Commission coincides with the ECB's presentation, on the same day, of its own report on the same subject. The ECB report flags up progress on the part of the seven countries in question regarding these convergence criteria.
Like the Commission, however, the ECB considers that none of these countries currently meets all the criteria to apply to adopt the single currency. (Original version in French by Lucas Tripoteau)