Jan 22 (Reuters) - Slovakia joined the euro on Jan. 1 and
the global financial and economic crisis has forced some of the
other new European Union members to take stock of their own
efforts to adopt the single currency.
Poland's government is aiming to join in 2012. Following is
a summary of where each country stands with euro adoption plans.
See [] for the latest Reuters poll of analysts on
likely euro adoption dates.
For a TAKE A LOOK, see [].
POLAND (GDP 380 bln euros, poll sees euro adoption in 2013)
Poland's government wants to take the EU's largest
ex-communist member into the euro zone in 2012 but faces
an uphill struggle convincing the conservative opposition to
back a necessary constitutional change.
Last October, Prime Minister Donald Tusk's cabinet released
a road map which envisages entering the pre-euro Exchange Rate
Mechanism (ERM-2) in the first half of 2009, a move which in
itself does not require amending the constitution.
The government signalled it is ready to join the ERM-2 even
without the change in the constitution but many analysts say it
is very risky and could expose the zloty currency to speculators
seeking to exploit the political uncertainty.
However some analysts say it may be good to enter ERM-2 at
this time as the zloty has shed some 30 percent since its
all-time high against the euro last July.
They say this could now make it easier to keep the zloty
inside the ERM-2's +/- 15 percent band, although with the
growing economic crisis, some analysts say the currency could
still potentially test the weaker limits of the range.
CZECH REPUBLIC (GDP 155 bln euros, poll sees adoption in
2013)
The Czech government had avoided setting a euro adoption
date after earlier abandoning a 2010 target, but Prime Minister
Mirek Topolanek said at the start of the year the government
would set a target date on Nov. 1.
The government has said the country should pick the right
moment to reap maximum benefits from monetary union entry. The
point has been echoed by central bank policymakers, who have
highlighted the current advantages of an independent currency.
But exporters, the backbone of the economy and hit by
currency strength for most of 2008, have urged swift adoption.
Finance Minister Miroslav Kalousek said the country could
adopt the euro currency in 2013 at the earliest; the same date
expected in the Reuters poll. The Czechs should meet all euro
entry criteria this year once inflation falls as expected. Euro
adoption in 2013 would require joining ERM-2 by early 2010.
ROMANIA (GDP 130 billion euros, poll sees euro adoption
2015)
The outgoing centrist government set a 2014 date for euro
adoption, a target under severe threat from current account and
fiscal deficits that are fuelling inflation.
The opposition Democrat-Liberal Party, which narrowly won a
Nov. 30 election, wants to stick to the ambitious euro plan.
Economists say this will require a major reform effort and
fiscal prudence.
HUNGARY (GDP 111 bln euros, poll sees adoption in 2013)
Hungary wants to join the euro "as soon as possible" but it
meets none of the criteria due to years of lax fiscal policies
and absence of reform. Before the financial crisis struck,
markets put Hungary's euro entry at 2013-2014 at the earliest.
Thanks to fiscal measures taken under an IMF-led bailout by
the Socialist government, Hungary is expected to meet the budget
deficit criterion of euro zone entry this year and inflation is
also falling rapidly. Its finance minister has said Hungary may
start talks towards the end of 2009 about joining ERM-2.
Some analysts expect Hungary to set a formal euro entry date
this year, and central bank Governor Andras Simor told Reuters
he expected to sit down in the first half of 2009 with the
government "to discuss euro adoption".
BULGARIA (GDP 33 bln euros, poll sees 2015)
Bulgaria no longer has a euro target date: its high
inflation and ballooning current account deficit have frustrated
its efforts to join the ERM-2 since 2007.
The country's economy looks vulnerable in the current crisis
and its political situation has been complicated by EU criticism
over Sofia's failure to curb corruption.
BALTIC STATES (GDP 74 bln euros, poll sees 2013)
The Baltic states, which are already in the ERM-2, had to
abandon plans for quick euro zone entry after inflation soared
to double digits during a credit-fuelled economic boom. The
credit crunch has hit them hard, with Latvia having to seek a
7.5 billion euro rescue from the IMF and the EU.
Estonia is also in recession and Lithuania is expecting a
near 5 percent drop in output this year. Estonia and Lithuania
are now aiming for the euro in 2011 and Latvia in 2012.
(Reporting by CEE bureaus, compiled by Krisztina Than; Editing
by Ruth Pitchford)
